Auto Insurance
Most people figure that if they’re going to skip on insurance somewhere, auto insurance is the most logical place to do so. The fact is, everyone who drives is required by law to carry liability insurance, meaning they are insured if they hit someone else and cause damage. However, when you hit someone else, the insurance company will not pay to fix your own car if you only carry liability. You must carry comprehensive coverage to ensure that you yourself are covered. Some people figure that their car is not worth much anyway, so what’s the point? Well, it is important to remember that comprehensive auto insurance usually covers the physical injury as well as that to your car. In fact, you must carry physical injury insurance for anyone that your harm by your own fault.

Scenario – Arjun has a 1990 Honda Accord. It’s not in very good shape, so Arjun figures he will only get liability insurance. After all, liability is Rs. 10,000 a month and comprehensive is Rs. 15,000 a month. Arjun saves Rs. 5000 a month by not insuring his own car. He also pays the bare minimum for liability coverage. There are several negative things that can happen from this scenario.

Option 1 – Arjun spaces out and runs a red light, causing a nasty collision with another car. Luckily, no one is injured, but both cars are totaled. Arjun’s insurance covers the repairs to the other car, but Arjun suddenly finds that his own car is not insured, and at last grasps the gravity of this risk. Arjun has no car and no means to purchase another. His transportation to work is gone. He barely has enough money saved up to pay the rent, let alone purchase another vehicle. This situation seems pretty bad, but it could have been a lot worse.

Option 2 – Arjun spaces out and runs a red light, causing a nasty collision with another car. The driver of the other car is severely injured, and seems to be unconscious. It turns out the driver will need years of surgery to repair the damage that has been done. Arjun’s bare minimum policy covers the driver of the vehicle up to 5,00,000 Rupees. However, within a month, the cost of the driver’s surgeries exceed this amount, and continue to pile up. Arjun is in debt a lac rupees within the year, effectively ending any plans to purchase anything but food and shelter for the rest of his life.

This option may seem extreme, but it is not. When you pick the bare minimum on an insurance policy, you are still taking a risk, even though insured. Accidents happen every minute of every day, and many of these people are injured. With the rising costs of medical care, it is vital to make sure that you are covered through a decent amount of physical liability. Many insurance companies seem to offer you a great rate, but it is important to understand just what you are being insured on. Sometimes, you can purchase an “umbrella” policy, which will cover all of these things. This, too, seems like a great deal, but usually the coverage is very limited. For more details, please contact us.
 
Homeowner’s / Property Insurance
The general rule is to insure what you can’t afford to lose. Valuable property that cannot be replaced without financial hardship but that would need to be replaced should absolutely be insured. Your house, if you own one, should always be insured. Homeowner’s insurance will usually cover all possessions within your house, so in case of a fire, everything you own inside your house would be insured. This is a very good idea if your house is filled with valuable possessions. Renter’s insurance is the equivalent of this for people who rent. Sadly, many people don’t choose to carry insurance on their house, and the results can be crippling, financially and emotionally. All it takes is one fire and your life as you know it is gone. 
Please contact us for more details. We will be happy to help you.