Not only cost of buying car is increasing every year but cost of car insurance is also rising in India. From the perspective of building a financial asset a car is not something like that. The value of the car depreciates every year and with depreciating value the IDV of the car also decreases. The premium that you pay towards buying car insurance depends on the IDV of the car. Since a car policy is not something that is an asset so while buying car policy in India we should always look at ways to save money on premium every time.
Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedgeagainst the risk of a contingent, uncertain loss. An insurer, or insurance carrier, is selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount of money to be charged for a certain amount of insurance coverage is called the premium. Risk management, the practice of appraisingand controlling risk, has evolved as a discrete field of study and practice.