10 Common Myths About Motor Insurance in 2025

Indians love to gossip and tell stories. As a closely knit society, we often try to prove our point and provide made-up evidence to support our tales. This results in the formation of myths, and people in both urban and rural areas start believing in them.

The motor insurance sector is no stranger to these beliefs. If someone’s claim were rejected for a reason, we would presume ours would also be dismissed. Suppose someone’s imported car was denied insurance. In that case, we will assume we also fall in the same category, without fact-checking. Unquestioningly trusting such myths can prevent people from getting insurance, which can cause more harm than not.

Hence, we seek to bust the top 10 motor insurance myths of 2025 so that you can make informed choices about protecting your car and, in turn, your bank balance.

Let us take into account the most popular myths, followed by the facts that you must know:

• Third Party Insurance is Sufficient

It is a common myth but you must consider a comprehensive insurance plans as a third party insurance policy covers third-party liabilities like injury, death, or property damage, not your vehicle. Opt for a comprehensive policy to cover theft, natural disasters, and damages.

• Older cars don’t need insurance

You need a valid insurance to legally drive on the Indian roads. Furthermore, older cars are often theft-prone due to the demand for spare parts, and motor insurance is still crucial.

• No-Claim Bonus (NCB) is non-transferable

Another popular myth as you should know that NCB is linked to the policyholder, not the vehicle. Ensure your NCB is transferred to your new policy to retain your claim-free discounts

• Insurance covers all types of damage

No, not all types of damages are covered in your comprehensive insurance policy. Standard policies exclude specific damages like engine failure unless add-ons are purchased. Always read policy inclusions and consider add-ons like engine protection or accessories cover.

• Premiums rise with vehicle age

On the contrary, older cars usually have lower premiums due to depreciation. However, frequent claims or high-risk zones can still cause premium hikes.

• Car colour affects insurance premiums

The vehicle’s colour has zero impact on premium rates. Focus on safety features, engine capacity, and claim history to lower your premium.

• Personal belongings are covered (such as in a parked or stolen vehicle)

Items like electronics, valuables or clothes inside the car are generally not covered. Buy separate coverage or look for add-ons if you carry valuables frequently in your vehicle.

• Drunk driving is covered

Drunk driving is a serious offence and any claims from drunk driving are almost always denied. Our suggestion: always drive sober; insurance won’t save you from legal or financial consequences.

• Buying insurance online is risky

Online insurance platforms are secure, transparent, and often cheaper. Use them to compare, read reviews, and buy quickly with full documentation.

• Claim processes are complicated and time-consuming

Modern insurers offer app-based claims and quick settlements. Most claims can now be filed and tracked digitally within minutes.

We are not fact-checkers, but we managed to debunk some of the most common myths you might have encountered while buying or renewing motor insurance. One of the common mistakes people often make while buying motor insurance (or any other type of insurance) is not asking questions.

If you have any questions, you must ask your agent or the customer support executive of your preferred aggregator platform directly. You must not buy an insurance policy unless all your questions are answered properly and satisfactorily.