Insurance for Imported vs. Domestic Cars: Key Differences Buyers Should Know

 

What is Import Car Insurance?

Imported automobile insurance is a type of insurance coverage specifically designed for vehicles that were not manufactured in India and were imported into the country through proper import procedures. These cars may be:

 

• Completely Built Units (CBUs): Shipped into India after being fully constructed abroad.

   

• Semi-Knocked-Down (SKD) or Completely-Knocked-Down (CKD) units: Made in India with imported components.

 

Finding components and keeping them in good working order can be costly, as imported cars often have differing requirements. They thus need special underwriting considerations, and insurers frequently categorise them differently from domestic cars.

 

Insurance for Imported Cars in India

In India, imported Car Insurance in India is regulated by the same core laws as any other motor insurance, primarily the Motor Vehicles Act, 1988. However, these vehicles are assessed differently by insurers due to:

 

• Higher Insured Declared Value (IDV) owing to customs duties and transport costs

   

• Limited service centres and parts availability

   

• Custom features that require tailored coverage

 

Insurance is mandatory under Indian law, and at a minimum, all vehicles are required to have Third-Party Liability Coverage. Due to the high value and potential repair expenses of imported cars, the majority of the owners choose Comprehensive Car Insurance.

 

What Does Imported Car Insurance Cover?

A comprehensive imported Vehicle Insurance Plan typically covers:

 

• Accidental damage (own damage and third-party)

   

• Theft or burglary

   

• Fire, explosion, and natural disasters

   

• Transit risks (from port to showroom or owner’s residence)

   

• Customised parts if declared during policy purchase

 

Some insurers also provide add-on covers, such as Engine Protection, Zero Depreciation, and Roadside Assistance, tailored to the specific needs of imported vehicles.

 

Note: Double-check that your insurance provider accepts coverage for imported cars and clearly discloses any exclusions.

 

Imported Car Insurance vs Normal Car Insurance

Here’s a quick comparison of imported Car Insurance vs normal Car Insurance (for domestic cars):
 

Feature	Imported Cars	Domestic Cars
Premiums	Higher due to IDV, repair cost, and part availability	Lower, especially for mass-market models
Parts and Service	Limited availability, often imported	Widely available across India
Underwriting Process	Customised, more documentation required	Standardised underwriting
Claim Settlement Time	Potential delays due to parts procurement	Faster due to local access
Add-ons	Limited, may vary across insurers	Broad range available

 

This highlights how domestic Car Insurance is often simpler and more economical.

 

Is Car Insurance for Imported Cars Higher?

Yes, imported Car Insurance costs much more for various reasons:

 

• High IDV: Shipping, import taxes, and GST are all included in the price of an imported car.

   

• Costly repairs: Parts are frequently purchased from overseas.

   

• Specialist labour: Not all workshops are capable of repairing imported models.

   

• Increased theft risk: Foreign and luxury cars are more susceptible to theft.

 

What are the Tips Before Purchasing Car Insurance for Imported Cars

Here are essential things to keep in mind before getting Car Insurance for foreign vehicles:

 

• Choose an expert insurer: Not many insurance companies provide coverage for imported cars, so pick one with experience.

   

• Declare accessories and modifications: Failure to disclose may render claims void and invalid.

   

• Ensure network garage coverage: Verify whether your car type is eligible for cashless repairs.

   

• Carefully consider add-ons: For comprehensive protection, you can choose add-ons such as Zero Depreciation or Return to Invoice.

   

• Review claim settlement history: Select insurance companies with high ratings for claims involving imported vehicles.

 

Summing Up

Whether you drive a locally made SUV or a German import, it's essential to understand the type of insurance to get. Imported Car Insurance in India provides crucial protection against the specific hazards that foreign vehicles encounter in the Indian market, although it may be more expensive and complex. On the contrary, domestic Car Insurance is more affordable, easier to get, and processed more quickly.

 

On a different note–if you're looking for affordable Car Insurance. Shriram Car Insurance provides reliable, customisable Car Insurance solutions. Insure with us to safeguard your vehicle on the road with hassle-free claims, dedicated customer service, and options that could cover everything from theft to natural disasters.

 

FAQs

1. Can I insure a car that has been imported as a used vehicle?

Yes, but insurers will carefully evaluate the car’s condition, model year, and documentation.

 

2. Is Third-Party Liability Insurance sufficient for imported cars?

Legally, yes. But given their high value, Comprehensive Car Insurance is strongly advised.

 

3. Do imported cars have different claim processes?

Yes, due to parts sourcing and approvals, claim settlements may take longer.

 

4. Can I get a Zero Depreciation Cover for imported vehicles?

In some cases, yes. However, this depends on the insurer’s policy terms and the car model.