What is voluntary deductible in car insurance? Car insurance misconceptions About Voluntary Deductible

There are several car insurance misconceptions about voluntary deductibles. Clearing the misunderstanding pertaining to this commonly used terminology in car insurance in this blog.

A car insurance policy is a mandatory document to possess when you purchase a new car and get set to hit it on the road. This official document contains a number of terms which may not exactly be clear to many. Voluntary deductible is one such term commonly used in regard to car insurance plans. Here we discuss some of the often misconstrued beliefs about this term. But before that, let’s take a quick look at what exactly voluntary deductible in car insurance stands for.

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What is Voluntary Deductible in Car Insurance?

What the term essentially means (and as the name too suggests) is the amount of money that the policyholder volunteers to pay or allows to be deducted for future payment of claims in any unforeseen event. In other words, when you purchase a car insurance policy, you pay a certain amount of premium in order to receive the insurance benefit in case of any accident/theft/car loss. This insurance benefit is paid by the insurer.

Now, in case of voluntary deductible, the insured or the policyholder is required to volunteer for the payment or deduction of a certain amount of the total claim money from their own pocket, before filing a claim to the insurer. For instance, a car insurance policyholder raises a claim of Rs. 5,000 to their insurance company for compensation of car repair in the event of an accident.

In this case, under the voluntary deductible clause of the car insurance policy, the policyholder would choose to pay a certain amount voluntarily towards the claim, say Rs. 2,500. The remaining claim amount would then be settled by the insurer.

Now, how does this exactly help the insured? What is in it for the policyholder, you’d be thinking.

Here’s the deal – with a voluntary deductible, the car insurance policyholder can hope to pay a smaller amount of premium towards the insurance plan! In fact, the higher the voluntary deductible amount chosen by you, the lower premium you’d need to pay towards your car insurance policy!

Car insurance misconceptions About Voluntary Deductibles 

Voluntary deductible is an essential component of car insurance plans; however, the term is often misunderstood by many. Here are some car insurance misconceptions of the term and a clarification on the same:

Is Voluntary Deductible in Car Insurance Mandatory?

In car insurance policies, there are two kinds of deductibles:

1. Compulsory Deductible
2. Voluntary Deductible

As is evident from the name, a compulsory deductible in car insurance is mandated by the Insurance Regulatory Development Authority of India (IRDAI). As for the voluntary component, it is optional for the policyholder, since it needs to be paid in addition to the compulsory deductible determined by the IRDAI.

However, payment of a voluntary deductible is only in the favor of a policyholder since it allows for a lesser amount of premium payable on the policy if one chooses to avail this component in car insurance.

How to Purchase Car Insurance Online?

Buying your car insurance policy online is a relatively simpler and hassle-free process. All you need to do is select a car insurance company that you’d like to purchase the policy from and log on to its website. It’d ask you to enter the required details of your vehicle.

You’d be presented with a variety of plan options to choose from, which you can do as per your budget and insurance needs. Also, make sure to do your research and compare all the different car insurance quotes from different plans in order to make an informed decision.

Lastly, pay for the plan that you chose online via net banking and other convenient modes and you’re done! Your car insurance policy is bought online in just 3 steps!

What is the Procedure for Car Insurance Renewal?

Once the term of your car insurance policy expires, you’d be required to apply for its renewal in order to continue enjoying the benefits of car insurance in the future.

Just like buying a car insurance policy online is an easy and carefree process, so is renewing your policy because it too can be done online. The steps are somewhat similar to those of buying car insurance online. First you choose the insurer with whom you would want to renew your policy. Go to their website and enter all the necessary car details like name of the owner, registration number of the car, etc.

Choose the plan that you’d like to replace your current plan with at the time of renewal. You’d be presented with a host of options and you can choose the one that best suits your needs. Fill out the form duly after choosing the plan. At this stage, you’d also be given the option to include add-on rider benefits to your policy, if you so desire.

Rider benefits come with a number of advantages in terms of coverage of the plan so it’s always a good idea to check with your insurer once about the add-ons they provide. Once you have finalized the plan that you’d like (with or without add-ons), simply pay online and your car insurance is renewed!

Read More: 10 Best Car Insurance Company in India 2022 with Their Claim Settlement Ratio

Summing Up

Voluntary deductible, though an optional feature, has a positive advantage for the policyholder. Make sure to opt for it in your car insurance policy to enjoy less premium payment for the entire policy term. Also, don’t make the mistake of confusing it with other components of car insurance; hope this blog helps to clarify all your doubts.

 

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