I have a used car in Surat. How to calculate insurance for a used car?

Surat being the 4th fastest growing city in the world, has seen a significant rise in sales of private vehicles. As per the statistics, Surat is among the top 10 cities in India in terms of Luxury car sales. While the new vehicles will come with a mandatory 3 to 5 years of TP (Third Party) insurance the existing owners need to get themselves insured on their own.

Similarly, for used cars and its general insurance in Surat as well, people generally go for the following insurance options:


There are 2 types of insurance available:


  • Third Party Insurance
  • Comprehensive Insurance

Third Party Insurance (TP Insurance) as the name suggest covers damage done by your vehicle to a third-party person or property. With new regulations of motor vehicles act, 1988 the government has mandated third party insurance for all private and commercial vehicles.

While Comprehensive Insurance is an add-on and not mandated by the government, many insurance agents in Surat provide it. It covers both: loss to your own vehicle by an external force or accident and damage to third party property or person by your vehicle.

Premium rates for TP insurance has been fixed under Indian Motor Tariff rules by Insurance Regulatory and Development Authority of India (IRDAI). Irrespective of the insurer, the coverage provided and premium charged will remain unchanged for TP insurance. While TP insurance provides coverage for damages to third party property up to Rs. 7.5 Lakhs, there is no limit in case of liability arising out of injury or death to a third-party person.

Comprehensive coverage, also known as Own Damage cover provides multiple options for the vehicle owners in terms of coverages. Various insurance companies provide various additional features such as:

  • Tyre Cover
  • Engine Protector
  • Nil Dep Cover
  • Road side assistance
  • Key Protector, etc.

Premium for such cover is determined based on various factors such as:

  • Make and Model of the vehicle
  • Age of vehicle
  • Previous claims history
  • Current condition of vehicle

Based on the age and type of vehicle a range of IDV’s are determined by the insurance companies. IDV: Insured Declared Value is the current acceptable market value of the vehicle. The owner can choose a value from the given range which will be the maximum amount payable in case of complete loss or theft of the vehicle.

Once the IDV is mutually agreed upon by the owner and insurance company, the premium is determined based on the condition of the vehicle. If there is an existing insurance applicable on the vehicle, then based on the claim history a No Claim Bonus is determined which provides as a base for discount on the premium.


Nil depreciation is an important feature in auto insurance –

  • Choosing this additional feature provides you full compensation for replacement/repair of the damaged part by the insurance company, irrespective of the depreciated market value of the part.
  • Nil Depreciation feature is available up to a maximum of 7 years from first purchase of the vehicle. After completion of 7 years any claim is payable only up to 50% by the insurance company. The remaining expenses are to be borne by the owner himself.
  • With each year IDV of the vehicle is reduced taking into consideration standard depreciation and wear and tear.

So, be it a new car or a used car in Surat, the method of calculating insurance remains identical except for certain factors such as No Claim Bonus and availability of features like Nil depreciation. Analyzing the increasing costs of repairs of luxurious vehicles and road safety conditions in India, it is always a wise decision to get yourself insured.

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