Is Own Damage Insurance for Your Car Worth It?

by SMCIB on Sunday, 11 June 2023

Is Own Damage Insurance for Your Car Worth It?

Your car is a valuable asset that carries you on countless journeys and represents your freedom on the road - it’s not just a mode of transportation! It becomes really important to protect your car against unforeseen events like accidents, theft, calamities, etc. This is where the importance of having the right insurance policy comes into play!

By choosing the appropriate insurance coverage, you can enjoy the financial security it will provide in the face of unforeseen expenses. And, Own Damage Insurance can help you do that. It aims to provide coverage specifically for any damages caused to your own vehicle.

But, is it really the right choice for your car? To get the answer, it is essential for you to consider various factors including your individual needs, the age of your car, etc. After conducting thorough research, you can make an informed choice, covering your vehicle and providing you peace of mind.

In this article, let’s explore own damage insurance and whether it is the best choice to protect your vehicle.


What Is Own Damage Insurance?

An own damage insurance policy is designed to protect your car from damage. It acts as a protective cover that offers financial support in the face of road accidents, fires, natural calamities, and even man-made disasters.

For instance, Aakash was driving down a busy city street. He crashed into the median due to fog on the road. The collision caused severe damage to his car’s bumper and windshield. Since he had own damage insurance, he raised a claim with his insurance provider. The repair expenses were borne by the insurer.


What Is Covered By An Own Damage Insurance Policy?

An own damage insurance policy covers any damages caused to the car due to the following reasons -

The insurance company will provide coverage for any damages caused to the car due to accidents or collisions.


If your car falls victim to a fire incident, explodes, self-ignites, or is struck by lightning, the insurance policy will step in to cover the resulting damages.

For example, Ravi had parked his car at his workplace. There was a sudden fire, which reached Ravi’s car, damaging it to a great extent. Since he has an own damage policy, the cost of repairing his car will be borne by the insurer.


Car owners often face the risk of theft. However, there is a silver lining - your insurance company is there to support you in such distressing situations. In the event of theft, your insurance policy provides coverage that compensates you for the value of your stolen vehicle. This coverage acts as a financial safeguard, helping you recover from the potential setbacks caused by the theft.

?Man-Made Disasters

Any damages caused to your car as a result of man-made disasters like riots, strikes, malicious acts, terrorist activities, etc. will be covered by your insurer.

For example, in Sudha’s locality, a riot broke out in which the rioters pelted stones and caused damage to properties, including vehicles. Unfortunately, Sudha’s car also suffered damages as a result. But since she has own damage insurance policy, the damages incurred by her car will be covered by her insurer.

?Natural Calamities

If your car sustains damages as a result of natural calamities like earthquakes, floods, typhoons, hurricanes, storms, tempests (violent windy storms), inundation, cyclones, hailstorms, frost, etc., the insurer will cover the expenses of repairing or replacing your damaged car.

An own damage insurance policy comes with a range of add-ons to help you enhance your coverage. Some of the available add-ons include-

    • Zero Depreciation Cover
    • Engine Protector Cover
    • Roadside Assistance Cover
    • Return To Invoice Cover
    • Consumable Cover, etc.

For instance, during a huge flood in his town, Prakash's car encountered damage to its engine because of water penetration. He owns an engine protector cover as part of his insurance policy. Therefore, his insurer will take care of the repairs needed for his engine, relieving him of a significant financial burden.


What Is Not Covered By An Own Damage Policy?

While an own damage insurance policy helps you to protect your vehicle, there are a few exceptions. The policy will not cover the following:

? Third-Party Damages

An own damage policy excludes coverage for any damages caused to a third party or their property. For example, Pranav was driving down a busy street and accidentally collided with another vehicle. This caused significant damage to the other driver’s car. In such a situation, an own damage policy will not cover the repair expenses for the other driver’s vehicle.

?Damages Caused When Driving Without Valid Licence
If you drive a vehicle without possessing a valid driving licence and cause an accident, an own damage insurance policy will not cover the damages caused.

?Damages Caused While Drunk Driving

An own damage policy excludes coverage for damages or accidents that occur when the driver is intoxicated.

?Any Consequential Damages
The own damage insurance policy excludes consequential damages, meaning, any indirect or secondary damage resulting from an unfortunate event will not be covered.

?Damages caused Due To Electrical Or Mechanical Fault

If inherent mechanical or electrical issues, such as electrical system malfunction, etc. cause damage to your vehicle,  an own damage policy will not cover the cost of repairs or replacements.

For instance, Sara owns an old car. One day while she was driving to work, her car broke down due to a mechanical fault. With the hope of financial support, Sara turns to her own damage insurance and files a claim. However, she discovers that the insurance policy does not cover damages resulting from mechanical issues. As a consequence, she has to bear the expenses on her own.

?Geographical Limits

If your car sustains damages outside the geographical boundary specified in your policy, the insurer will not provide coverage for the repairs or replacements required.

?Claims Arising Out Of Contractual Liability

Any claims that arise out of a contractual agreement or obligation will not be honoured by the insurer.

?War Or Nuclear Weapons

If your car is damaged due to acts of war, conflicts, hostilities, or nuclear events, an own damage insurance policy will not provide coverage for the associated expenses.


So, is Own Damage Cover For Your Car Worth It?

Determining whether an own damage cover is beneficial for your car or not entirely depends on your needs and circumstances. There are multiple factors that need to be evaluated for the same.

Let us understand with these two case scenarios -

Example 1:  Ravi owns a 12-year-old car that is rarely driven, and he is considering selling or scrapping it. Getting an own damage insurance policy for such a car would be an unnecessary expense. A third-party insurance policy would be the right choice.

Example 2: Rakhi owns an expensive car that she uses for her daily commute. If she buys a third-party-only policy, she won’t get coverage in case her car is damaged or stolen. Such unforeseen events can result in substantial out-of-pocket expenses - causing a significant financial burden for her. Thus, an own damage policy will be the best fit in such a situation. It will help her meet the financial expenses incurred in repairing the vehicle - offering her much-needed peace of mind.

Hence, owning an own damage insurance policy entirely depends on what suits your car best. It will assure that you won’t have to worry about arranging funds in case your car is damaged. Also, it will help you avoid any financial setbacks caused if your car is stolen.



Own damage insurance protects your vehicle against unexpected events such as accidents, thefts, or calamities. It ensures that your car is restored or replaced to its former splendour. The decision to purchase an own damage policy should ultimately be based on your individual needs and financial situation. Before investing your money, take time to research the available options - to ensure you make the most suitable choice.

Insurance Knowledge Videos