Moneycontrol News
A majority of Indian customers buy car insurance only after being apprehended by the traffic police, says a survey by COCO by DHFL General Insurance.
The report said that seven in every 10 respondents claimed to buy insurance after being caught by the traffic police.
The percent of renewals is not high either. The survey said that 43 percent of respondents from Delhi have not renewed their car insurance policy, even after being caught by the traffic policy, followed by 40 percent from Bengaluru and 33 percent from Mumbai. Further, 25 percent of the respondents said that they have forgotten to renew their car insurance.
The study was conducted to encourage conversations and increase awareness of the underlying factors and behavioural traits involved while obtaining a car insurance policy. The total base of this survey is 1025 respondents across three key metro cities, Mumbai, Delhi and Bengaluru.
According to the COCOBarometer conducted in Mumbai, Delhi, and Bengaluru, approximately 74 percent of the respondents have an active car insurance policy.
The remaining 26 percent with a lapsed policy, claim that their insurance company failed to remind them about the policy renewal or they just forgot to renew it on time.
Interestingly, 19 percent respondents claim that paying fine is cheaper than buying insurance.
Vijay Sinha, MD and CEO, COCO by DHFL General Insurance said: "Buying an insurance policy is considered as an additional financial drain, and people are willing to risk the penalties of driving without insurance to save money in the near term. As an insurer, we believe we have an important role to play in creating awareness on the value of buying car insurance, along with demystifying insurance by offering transparent products."
All vehicles running on Indian roads are required to have a valid third party motor insurance policy. This is mandatory as per the Motor Vehicles Act 1988. Customers can also buy a comprehensive cover that protects the vehicle from damage as well as provides third party cover.
Customers are aware about mandatory insurance
About four in every 10 of the respondents with lapsed insurance, have been caught by the traffic police. The percentage of respondents being caught by traffic police is most in Delhi (43 percent) and least in Mumbai (33 percent). Yet, one in every four respondents didn't buy a policy even after being caught by the traffic police.
'Law' and 'concern for car' are equally important while obtaining insurance. With respect to individual products, comprehensive with zero-depreciation cover is the most opted policy for car insurance with 70 percent of the car owners availing it. The survey also pointed that that 'third-party only' was the least preferred policy for car insurance.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
