Dealer vs. Online Car Insurance – What’s Better in 2025?
Should you buy car insurance from the dealer or compare policies online? Here’s the 2025 guide to choosing the best insurance option when buying a new car.
When buying a new car, insurance is mandatory for registration and driving on Indian roads. But the big question is — should you go with the insurance policy offered by the dealership, or explore online options for better value?
Let’s break down the pros, cons, and considerations for both in 2025.
1. Dealer-Offered Car Insurance
Most car dealers will include an insurance plan in your on-road price quote. While convenient, these plans are often premium-priced and not fully customizable.
Pros:
- Hassle-free – included in billing
- Immediate processing for registration
- No paperwork or external follow-up
Cons:
- Higher premium
- Limited choice of insurers
- Might include unnecessary add-ons
- Less flexibility in claim process
2. Buying Insurance Online
Third-party insurance aggregators and insurer websites offer instant policy comparisons, customizable add-ons, and lower rates.
Pros:
- Cheaper premiums (up to 30% less)
- Option to choose add-ons (zero depreciation, engine cover, etc.)
- Multiple insurer options
- Transparent T&Cs
Cons:
- Needs personal effort and research
- Delay in registration if not done in advance
- Some dealerships may resist using third-party policies (but legally can’t deny)
3. What to Look for in a Policy?
- Coverage: Comprehensive vs Third-Party
- IDV (Insured Declared Value): Higher IDV = better payout in total loss
- Add-ons: Zero depreciation, return to invoice, engine protect
- Claim Process & Garage Network
- Customer reviews & claim settlement ratio
4. Our Recommendation (2025)
Buy insurance online unless the dealer is offering a competitive quote and quick delivery is essential. Always compare at least 3-5 policies on platforms like:
- Policybazaar
- Acko
- Tata AIG
- HDFC Ergo
- Digit Insurance
Final Thoughts
In 2025, buyers are more informed and digitally savvy. Don’t fall for the convenience trap — a 15-minute research session could save you ₹10,000–₹25,000 or get you far better coverage.
Be a smart buyer. Choose your insurance policy with as much attention as the car itself!