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Know How to Determine the Car’s Value While Taking an Insurance

As per the mandate issued by the Government of India, third-party insurance is a compulsory requirement for every car and motor vehicle owner. Apart from that, the mandate also makes it necessary for automobile owners to have comprehensive car insurance in place. This not only covers the insured from the expenses incurred in a road accident, but the legal financial liability to the third-party is also paid off by the insurer. 



So, in and all, having insurance is more than essential. That said, it is equally essential to be aware of your car's value for determining the most suitable auto-insurance coverage. How? Is there a way one can determine the actual value of his/her car before taking insurance? The answer is YES. One always has the option to determine the car’s replace-cost versus cash-value.

What is a car’s replace-cost versus cash-value?

As the terms suggest, 'actual cash value' is the value of a car at any given point of time. The same is determined while considering multiple factors such as the date of purchase, the physical condition, and how much has it been used. On the other hand, 'replacement cost' basically refers to the amount it would cost to repair or replace a lost, stolen or damaged item with one of the same material and quality as the original — in the present market.

The only difference between replacement cost and the actual cash value is a deduction for depreciation. Lastly, as a general policy, most standard auto insurance policies won't pay replacement cost if the vehicle is "totaled"—that is if the repairs cost more than the cash value assigned to the car.

You can also click this link for more info: How Does Car Insurance Determine Car Value?
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  1. Unknown27 March 2019 at 14:39

    Hi,

    I have gone through your blog. Thank you for sharing your blog with us. It is very informative. We at Policy21st also give you a lot of benefits with the Car Insurance such as the third party liability, engine cover, zero depreciation cover along with the coverage against the personal accidents, damages, accidents due to man made or natural reasons etc.

    ReplyDelete

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