IDV, the deductible and the bonus

IDV is the sum insured on the own-damage side, and it is quietly negotiable. Declare a lower IDV and the yearly cost of the own-damage cover falls with it, because the insurer's worst case has shrunk. That saving is real.

So is the other half of the trade. Theft and a written-off vehicle are settled at the IDV, so the figure you chose to look thrifty in March is the figure you are paid in November. IRDAI's own handbook warns that a lower IDV adversely impacts you in the event of claim settlement.

The no-claim bonus is a discount for a year in which you claimed nothing. IRDAI's handbook puts it at 20% off the own-damage part after one claim-free year, rising by stages to a maximum of 50% after five in a row. It never touches the liability part.

Three things about it surprise people. Make one claim and the bonus is lost for the following year. The bonus belongs to you, not to the vehicle, so it travels to a new insurer or a new machine. Let the policy lapse for more than 90 days and the whole accrued bonus is gone.