5 Types of Car Insurance Coverage Explained

Insurance coverage refers to the kinds of protection available. Along with basic coverage under the policy, you can choose a number of add-ons to enhance the protection under the policies. Let us first show you the five types of car insurance coverage available in India:

1. Third-Party Liability Only Cover

Under this type of car insurance coverage, you will get the following benefits:

Cost of repairs/replacement of the damaged vehicle of third parties

Cost of hospitalization and treatment of third parties

Liabilities arising out of death of third parties

According to the Motor Vehicles Act, third-party car insurance coverage is a must to drive on the roads. The sum assured should be according to the driving conditions and sufficiently high to avoid out-of-pocket payments from your side.

2. Collision Damage or Own Damage (OD) Cover

When you opt for collision damage car insurance coverage, the cost of repairs to your vehicle that has been damaged is reimbursed. To determine the cost of collision coverage, its age and Insured Declared Value are taken into account to arrive at the premium. The IDV is based on the market value of the vehicle.

When a claim is lodged under collision coverage policy, the maximum amount payable under the policy is given by the IDV less accumulated depreciation. If you have purchased your vehicle on a loan, you should hold collision cover.

3. Personal Accident Cover:

A Personal accident cover pays the owner-driver in the event of injury, disability, or death resulting from a road accident. It does not cover medical bills but provides a fixed lump sum amount in the event of death or specific disabilities. When comparing various car insurance types in India, ensure that this feature is available, as it is compulsory for owner-drivers. It is included in comprehensive car insurance as well as third-party motor insurance policies and must be purchased with either of these policies, unless the owner-driver has PA cover from another vehicle policy.

4. Zero Depreciation Insurance:

Zero depreciation car insurance is an add-on that guarantees you can claim the entire amount for parts of your vehicle that are being replaced, with no depreciation. It's best for new or luxury vehicles, and many insurers will allow this add-on for vehicles up to 7–10 years old, so don't think it is exclusively for new or luxury vehicles. If you are looking to investigate types of motor insurance specifically through car insurance online portals like car insurance quotes, this add-on will give you substantial financial relief during claims, and we highly recommend it before your next vehicle insurance renewal.

5. Comprehensive Car Insurance:

Among the different types of car insurance, comprehensive car insurance provides the most extensive protection. It covers third-party liabilities, own vehicle damage, natural disasters, theft, and even personal accident cover. However, PA cover for the owner-driver is not automatically included—it must be purchased separately if not already held for another vehicle. You can enhance it with add-ons like zero-depreciation car insurance, consumable cover, personal accident coverage, roadside assistance, and more. It’s one of the most popular types of vehicle insurance in India for private vehicle owners. For commercial vehicles, insurance requirements and coverage options may differ, and comprehensive policies may not be the default choice.

At Tata AIG, your need for protection and convenience are our topmost priorities. Our car insurance policies offer different features that can be customized to your specific requirements.

Tata AIG offers the following three types of policies.

At Tata AIG, we offer three types of car insurance policies designed to provide financial security and peace of mind. Each policy caters to different needs and can be customised with add-ons for enhanced coverage.

Comprehensive car insurance policy

Comprehensive car insurance is the most extensive policy type and covers third-party liabilities as well as own damage costs, loss due to theft, natural disasters etc. You will receive the IDV or the total market value in case your vehicle is stolen or damaged beyond repair.

Standalone own-damage car insurance policy

This policy takes care of own-damage, that is, loss to the policyholder’s car. This does not offer third-party car insurance coverage. This type of policy is effective from September 2018.

Standalone third-party car insurance policy

This is the basic policy and is mandatory for driving on public roads. It includes damage to third-party vehicles, injuries to third parties, medical costs and death of third parties.

We offer 12 add-on benefits that can enhance the coverage and offer more protection under the policies.

1.No Claim Bonus Protection: In general, if you don’t lodge a claim under your policy, you become eligible for NCB deduction at the time of renewal. With this add-on cover, you can lodge a predefined number of claims while retaining the NCB discount.

2.Zero Depreciation Cover: With the Zero depreciation add-on, you will be reimbursed the complete sum assured without deduction for depreciation of parts.

3.Return to Invoice Cover: When your claim for total damage or loss due to theft is settled, the depreciation might

4.Roadside Assistance Cover: You can get round-the-clock breakdown assistance for towing or emergency mechanic services

5.Repair of Glass, Fibre and Plastic Parts: You will be reimbursed for repair costs of glass, fibre and plastic parts. The claim under this car insurance add-on does not affect your NCB. However, only one claim in a policy year is allowed.

6.Daily Allowance Cover: You will get reimbursement for the cost of other modes of transport until your vehicle is repaired ready for the road again.

7.Emergency Transport and Hotel Expenses Cover: When you are stranded after an accident, you can get expenses of overnight accommodation and travel expenses to reach the city closest to your destination with this add on available with a comprehensive car insurance policy

8.Key Replacement Cover: With this add-on, you can get the keys replaced if you have lost them or when your stolen car is recovered.

9.Engine Secure: If you live in an area prone to flooding or water-logging, your engine should be protected. If you choose this add-on to your comprehensive car insurance policy, you can repair the engine without incurring additional expenses from your pocket.

10.Tyre Secure: When you repair a damaged tyre or tube, this add-on will reimburse the costs.

11.Consumables expenses: When you replace air conditioner gas, gearbox oil, oil filter, and other consumables after an accident, this add-on will cover the amount spent.

12.Loss of Personal Belongings: This add-on with comprehensive car insurance coverage helps to cover the loss of personal belongings such as videotapes, CDs, clothes etc. but excludes credit/debit cards, jewellery, money, watches etc.

You should know the different types of coverage that are available so that you can choose an appropriate policy with useful add-on riders. Check out Tata AIG car insurance for an all-round protection, easy claim settlement and 24x7 customer support. You can use our online car insurance calculator to determine the total premium outflow for your choice of policy.

For more information, get in touch with us today!

1. How many types of car insurance are there?

There are primarily three types of car insurance in India—Third-Party Insurance, Own Damage Cover, and Comprehensive Insurance. These plans vary in terms of coverage and suitability. Additionally, various add-ons and specialised options exist under broader types of vehicle insurance to meet individual driving needs.

2. What is the most common type of car insurance?

Comprehensive Insurance represents the main insurance policy choice among the types of car insurance. Under this type of coverage, both vehicle damage and third-party responsibilities get full protection. Most drivers from various motor insurance segments choose it due to both its extensive protection features and flexibility benefits.

3. Is it possible to choose add-ons in a comprehensive policy? Does it have any effect on the premium?

Yes, you can choose from several add-ons like zero depreciation, engine protection, and roadside assistance. These enhance your coverage but may increase your premium. Add-ons are usually available only under the comprehensive car insurance category among all types of car insurance in India.

4. What is 1st party and 3rd party insurance?

The owner of an insured vehicle can file claims with the insurance company under 1st party insurance but 3rd party insurance requires only policy coverage for damage to other vehicles or persons as defined by Indian vehicle insurance regulations.