You should increase the IDV for your beloved car or bike if you want to protect your financial investment on the same. If you are still not convinced, here are three scenarios where substantial insured value can benefit you:
1. Financial Assistance when the Vehicle suffers Massive Damage in Accidents
While minor accidents may result in a broken tail light or cracked windshield, severe road mishaps can leave your car/bike’s engine totalled.
When such a thing happens, you cannot simply get the same repaired at your nearby garage. In all likelihood, such extensive damage tends to be permanent, leaving you without a vehicle.
If your policy IDV is high, you can use the substantial compensation from your insurer to finance the purchase of a replacement car/bike at such times.
However, individuals who decrease their IDV may need to avail fresh auto loans to afford another vehicle.
2. Financial Compensation in case of Vehicle Theft
Expert drivers often make the mistake of lowering policy IDV simply because they are sure of never being involved with serious accidents.
However, the one thing they forget to take into account is that their cars or bikes are just as likely to be stolen as anybody else’s is.
If you own a high-end model, theft is a major risk for your vehicle. Moreover, if you have an open parking space, the chances of theft are even higher.
A higher IDV can assist you in case of car or bike theft as well. With the claim amount you acquire from your insurance company, you can plan the purchase of a replacement vehicle.
3. Mental Peace
Besides the monetary assistance, policies with high IDV can also keep your mind free from worry. Even if your beloved vehicle is involved in a major road accident, or you suffer from its loss due to theft, this extensive claim amount will minimise your financial loss.
Thus, such policyholders do not need to stress about these unforeseen events, which are beyond their control.
As one can clearly perceive, keeping the IDV close to or more than the market value of your car is the best bet. If you lower it any further, the compensation from the insurer may not be sufficient to acquire a replacement vehicle.
One should focus on his/her financial security instead of deciding the IDV based on policy premiums alone.
Slightly higher premiums may help you make the most of your motor insurance policy in the long term!