Ask Mint Money | No grace period is available for car insurance policies

Ask Mint Money | No grace period is available for car insurance policies
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First Published: Tue, Dec 20 2011. 08 39 PM IST

Updated: Tue, Dec 20 2011. 08 39 PM IST
I have a family floater health plan of Rs 3 lakh which covers my family. However, I feel that the cover is inadequate. I want to take a top-up plan of Rs 5 lakh keeping the base cover the same. Is it a good strategy?
-Rakesh
Keeping the rising cost of healthcare in mind, it would be good to get your coverage increased. Buying a top-up plan is a cost-effective way to increase your cover. A top-up cover reimburses expenses incurred above a certain limit which in your case can be Rs 3 lakh since your current policy is of Rs 3 lakh. This means that if there is a claim of Rs 4 lakh, a top-up policy will pay the amount above Rs 3 lakh and Rs 1 lakh will be reimbursed.
However, there could also be a situation wherein multiple claims of small value may exhaust your current policy and you will be left without insurance if more such claims come within the same policy period. A top-up cover will not pay these claims but a super top-up will. A super top-up cover reimburses any claims after the total of all the claims in a policy period exceeds the limit mentioned in the policy. However, it’s a bit expensive.
The cover for my car expired on 30 November and pending renewal, I met with an accident. Is there a grace period? Is there any other clause which makes me eligible to make a claim?
-Vivek Misra
There is no grace period available for car insurance. If the policy is not renewed on time, the car is uninsured. A car insurance policy has two sections—cover for damages to the vehicle and cover for injuries to a third party or damage to the property of a third party. The second part is called third-party liability and it is a compulsory cover. It is a punishable offence to ply a vehicle without a third-party liability cover.
Moreover, the owner of the vehicle carries unlimited liability in case of third-party death and injury claims. Without an insurance cover, such claims can be financially ruinous. Unfortunately, you can’t claim your vehicle repair expenses, but fortunately, it seems, there is no third-party claim.
I recently shifted from Kolkata to New Delhi. I own a house in both the cities. I have a householder’s policy for my Kolkata house. Can I get the policy transferred to my Delhi house?
-Abhirup Lahiri
Home insurance policy covers both the home contents and building. While you have moved the contents to your house in Delhi, the building in Kolkata is owned by you and needs insurance against fire, floods, malicious damage, riots and strikes. Since covering the building under home insurance is economical, keep your Kolkata house insured.
However, you can get the address amended to that of your house in Delhi in the current policy and take a new policy for your Kolkata house. If your house in Delhi is bigger than the one in Kolkata, you should get the value of the building increased in the policy.
Queries and views at mintmoney@livemint.com
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First Published: Tue, Dec 20 2011. 08 39 PM IST