What are the factors to consider while buying car insurance?

There are many crucial factors that an individual should consider while buying car insurance. Here’s what you should look for: Claim settlement ratio (CSR): While buying car insurance, you should consider the CSR of the insurer. The higher the CSR, the better. A higher CSR can give you the confidence that you can rely on your insurer to settle your claim in the event of an accident. However, you should make sure that you disclose all material information at the time of buying car insurance. Third-party car insurance is mandatory: As per the Motor Vehicles Act, third-party motor insurance is mandatory. Driving on public roads without this is an offence. However, you should consider buying a comprehensive insurance policy, which covers own damage along with third-party damage. So, in the event of an accident, if there is damage to your car, it will be covered under own damage insurance. Cashless facility and network garages: Check the list of network garages that the insurance company has. The bigger the network, the better it is. You can avail of the cashless facility at a network garage. With a cashless facility, you can get your car repaired after the accident, and the insurance company will pay the charges to the garage directly as per the policy terms and conditions. No claim bonus (NCB): A no claim bonus (NCB) is a discount on the annual renewal premium if you don’t make any claim throughout the year. An NCB usually increases by 10% for every claim-free year. For example, if you don't make a claim for five consecutive years, the insurer may give you an NCB of 50% on the annual renewal premium. Hassle-free claim settlement: Technology can play a big role right from buying car insurance to claim settlement. Check if the insurer allows you the option of buying car insurance, paying renewal premiums, and filing claims online. Some car insurance companies are using automation (artificial intelligence, machine learning, robotics, etc.) to do car inspections in the event of accidental damage. Automation helps to reduce the cost and time to settle the claim. So, check if the insurance company uses technology to provide assistance and convenience to the customer during the claim process.

Top 5 car insurance companies with claim settlement ratio above 90% in 2022

Date : 19/10/2022
Read: 4 mins

Claim settlement ratio is the number of claims settled by an insurance company for every 100 claims received in that year. We explore the top 5 car insurance companies with the highest CSR.

Top 5 car insurance companies with claim settlement ratio above 90 Percent

Car insurance has two aspects: own damage and third-party cover. Own damage covers any damage or loss to your own car during an accident or mishap, whereas the third-party component covers damage to any other person or property when your car is involved in an accident.

Buying third-party insurance is mandatory as per law, but it is recommended that you buy comprehensive motor insurance. The latter covers both own damage and third-party damage in a single motor insurance policy. Further, the higher the claim settlement ratio for an insurance company, the better it is for the policyholder.

Irrespective of the policy you choose, it is vital to select a reliable insurer that you can depend on in your hour of need. The higher the claim settlement ratio for an insurance company, the better it is for the policyholder, as it reduces the chances of claim rejection.

Understanding the relevance of the claim settlement ratio and picking the best car insurance company in India is essential for a financial secure future. Keep reading to know more.

What is the claim settlement ratio (CSR)?

Claim settlement ratio (CSR) is the number of claims settled/paid by an insurance company for every 100 claims received in that year. For instance, if an insurance company’s CSR for car insurance is 95% in a particular year, it means the insurance company settled 95 claims for every 100 claims received in that year.

Let us look at the best car insurance companies with a CSR of above 90%.

Which is the best car insurance company in India with CSR above 90%

Best car insurance company in India with Claim settlement ratio

Note: The above data is for Motor Own Damage (OD) claims. The data is for the year ended 31 March 2020. The data for the year ending 31 March 2021 is yet to be released by IRDAI.

What are the factors to consider while selecting the best car insurance company in India?

There are many crucial factors that an individual should consider while buying car insurance. Here’s what you should look for:

Claim settlement ratio (CSR): While buying car insurance, you should consider the CSR of the insurer. The higher the CSR, the better. A higher CSR can give you the confidence that you can rely on your insurer to settle your claim in the event of an accident. However, you should make sure that you disclose all material information at the time of buying car insurance.
Third-party car insurance is mandatory: As per the Motor Vehicles Act, third-party motor insurance is mandatory. Driving on public roads without this is an offence. However, you should consider buying a comprehensive insurance policy, which covers own damage along with third-party damage. So, in the event of an accident, if there is damage to your car, it will be covered under own damage insurance.
Cashless facility and network garages: Check the list of network garages that the insurance company has. The bigger the network, the better it is. You can avail of the cashless facility at a network garage. With a cashless facility, you can get your car repaired after the accident, and the insurance company will pay the charges to the garage directly as per the policy terms and conditions.
No claim bonus (NCB): A no claim bonus (NCB) is a discount on the annual renewal premium if you don’t make any claim throughout the year. An NCB usually increases by 10% for every claim-free year. For example, if you don't make a claim for five consecutive years, the insurer may give you an NCB of 50% on the annual renewal premium.
Hassle-free claim settlement: Technology can play a big role right from buying car insurance to claim settlement. Check if the insurer allows you the option of buying car insurance, paying renewal premiums, and filing claims online. Some car insurance companies are using automation (artificial intelligence, machine learning, robotics, etc.) to do car inspections in the event of accidental damage. Automation helps to reduce the cost and time to settle the claim. So, check if the insurance company uses technology to provide assistance and convenience to the customer during the claim process.

Conclusion

Now that you understand the claim settlement ratio (CSR) and its importance, you should compare the CSR of the best car insurance companies before making a purchase. You should give preference to a company with a higher CSR. You should also consider other factors such as cashless facility, network garages, NCB, premium, etc., and choose the company and motor policy that best suits your requirement.