June 13, 2024

Everything You Need to Know About Luxury Car Insurance

So, you have finally bought your dream luxury car. Congratulations! Bet it feels perfect. But, did you know your basic third-party car insurance policy will not suffice for this car? Just the way your luxury car stands out among regular cars, you need car insurance that can cover it under any circumstance. Mostly, the car insurance premium is dependent on the performance, maintenance cost, and buying price of the car.

Even minor repairs in a luxury car cost much more than they would for a regular car. In case of an accident, the repair cost will be unimaginable. It is so because the parts of a luxury car cannot be substituted with substandard or unbranded materials, and standard car insurance might not cover the damages.

Due to this reason, many insurance companies offer insurance covers specially designed for luxury cars to protect this invaluable asset. There is an increasing number of luxury cars on Indian roads, prompting insurers to provide customized insurance policies for luxury cars.

What is the cost of luxury car insurance?

Several factors determine the cost of your luxury car’s insurance policy. These factors include:

Vehicle’s age
No Claim Bonus (if any)
Claim history (if any)

It is important to note that the cost of your insurance will also depend on the type of policy and your choice of insurer.

How to check insurance rates for luxury cars?

You may use car insurance premium calculators to get premium rates for luxury vehicles. Digital insurers offer free car insurance premium calculators on their websites. Fill in basic information about your car and you will be able to determine the approximate premium cost of your insurance policy.

What is exotic car insurance?

Exotic cars are rare. It is therefore difficult to find exotic car insurance policies. An insurance company’s website might not list exotic cars as insurable. By contacting them directly through email or phone, you can negotiate a good deal for your exotic car. Once your exotic car is inspected by the insurance company, they will offer you a quote for your car insurance premium. Your luxury vehicle will be insured once you accept the quote and make the payment.

Here are a few things to keep in mind while looking for luxury car insurance:

1. Buy add-ons

Add-ons provide extra coverage for an additional fee. It is common to include add-on covers to safeguard situations that are otherwise not covered by standard insurance policies. In some cases, they are also service-oriented. Make sure you understand your coverage requirements and choose only the right add-ons. Roadside Assistance, Engine Protection, and Zero Depreciation are popular add-ons for luxury cars. Add-ons are not available for usual third party car insurance for normal cars.

2. Compare online

A luxury car’s policy might cost differently depending on the insurer you choose. Consider the necessary coverage when comparing policies. It is possible for policies to be cheaper but have fewer benefits. Digital-first companies offer affordable rates and good coverage.

3. Calculate premium

You can use an insurance premium calculator to get an estimated cost for your luxury car insurance. If the number is not satisfactory, you can tweak your coverage and understand how it affects the overall insurance cost instantly. Skipping add-ons can bring down your price but experts advise against this.

4. Install anti-theft devices

Since luxury cars are more prone to theft, you may want to protect your car by installing certified anti-theft devices. The insurer may charge a lower premium for a well-protected car.

Types of Add-ons To Consider

1. Engine Protection

Protecting your luxury car’s engine is extremely important. Any damage to its engine can result in a hefty repair bill. For instance, your car engine can be damaged by flooding. However, you must invest in an Engine Protection Cover to safeguard your luxury car’s engine under most circumstances.

2. Roadside Assistance

Imagine a situation where your luxury car breaks down in the middle of nowhere. Being stranded on the road would be the last thing you want. The Roadside Assistance add-on can be of great help in such situations. With this add-on, you will get on-the-go assistance from your insurer. You will be sent help and if on-the-spot repairs are not possible, your car will be towed to the nearest network garage. This way, you do not have to worry about finding a mechanic or towing service on a deserted road.

3. Return to Invoice

Your luxury car has a high invoice value. Usually, if you face total damage or loss, your insurer will settle the claim as per the Insured Declared Value (IDV), which is always less than the invoice value. However, the Return to Invoice add-on will allow you to get reimbursed for the invoice value instead of the IDV.

4. No Claim Bonus Protection

No Claim Bonus (NCB) comes in handy at the time of insurance policy renewal. If you do not raise a claim during the policy term you are rewarded with NCB by the insurer. This reward is given to you in the form of a discount on the premium amount. The No Claim Bonus Protection add-on allows you to avail of the NCB discount despite raising a claim.

5. Original Equipment Manufacturer Parts

Always install only original parts while repairing your car. Any other parts have the potential to harm your policy or coverage.

6. Comprehensive Coverage

Third-party car insurance is mandatory in India. In case of an accident, it protects the policyholder against third-party liabilities. However, third-party car insurance does not cover the repair costs of your vehicle. To get coverage for your losses, you must have comprehensive car insurance.

How to get the best insurance policy for your luxury car?

The best luxury car insurance meets your needs without stretching your budget. Before shortlisting and buying insurance for your luxury car, research and compare policies. Look for a policy that offers maximum coverage at an affordable premium. Get add-ons if you want exhaustive coverage.

Frequently Asked Questions

1. What if I don’t want to insure my luxury car?

Not having a valid car insurance policy can expose you to legal and financial risks such as hefty fines and/or even imprisonment.

2. How to know if my insurer offers luxury car insurance?

You can always call the insurance company or your relationship agent to check if they offer specific policies for luxury cars.

3. Should I opt for comprehensive insurance for my luxury car?
Experts advise that a comprehensive cover is always better since it offers better and wider coverage than a standard or third-party liability policy.

4. Can I switch to a different plan or insurer while renewing my policy?

Yes, you can switch insurers and plans for the better while renewing your car insurance policy.

5. Can my insurance policy cover the accessories I have in my car?

Yes, you can purchase add-ons to insure the accessories kept in your car.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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