An insurer is a person or a company that contracts to indemnify another in the event of loss or damage. The major task of insurers of motor insurance companies is to assist the policyholders to have a foresight, for you to deal with risks which might arise in the future proficiently. They do so by educating you about the right insurance products and aiding you to get your claims covered by the policies if needed.
The primary objective of this vehicle insurance is to provide a protection to you and your vehicle against any physical damage resulting from accidents. A motor or vehicle insurance in India covers any kind of loss or damage to the auto mobile or its spare parts due to man-made or natural calamities. Insurance policy gives accident cover for the vehicle’s owner while driving and third-party liability and for the passengers sitting in the vehicle at the time of accident.
Inclusions:
- Accident occurred due to external means.
- Man-made calamities, such as burglary, riots, theft, explosion, and strikes, terrorism, etc.
- Natural calamities like fire, cyclones, earthquakes, floods, typhoons, storms, hurricanes, lightning, etc.
- When the vehicle is in Transit by rail, road, air or waterway.
- Third party liability.
- Coverage for an owner driver in case of demise.
Exclusion:
- Wear and tear of the vehicle due to its usage.
- Loss or damage due to depreciation of vehicle.
- Electrical or Mechanical breakdown.
- Wear and tear of consumables like tires and tubes.
- Loss or damage incurred to the vehicle outside the geographical area.
- Loss or damage caused by driving under the influence of intoxication (alcohol or drugs).
- Loss or damage caused by an unauthorized person driving without a valid driving license.
- Loss or damage due to nuclear risks.
- Damages caused due to over speeding.
* The above, may vary from insurer to insurer.
Types of Motor Insurance
Private Car Insurance
The first mandatory thing after purchasing a car is taking insurance policy. It is a financial safeguard for large variety of situations. The premium amount for the car insurance policy depends on the value of the car, its make, the manufacturing year of the car and the state where your car is registered. There are further two types of car insurance policy: Comprehensive Car Insurance policy and Third-Party Liability Insurance policy.
- Comprehensive Car Insurance : This type of policy gives full coverage to the policy holder which includes loss or damage to the insured car, personal accident and third-party liability in case of any accident. Comprehensive insurance policy gives end to end coverage to the policy holder which includes any loss or damage to the insured car and an unknown stranger (third-party) and personal accident. It protects you from any kind of financial or legal crises.
- Third-Party Liability : According to the Motor Insurance Act, third party motor insurance is compulsory in India. This policy only covers the loss or damage to the third party, who has been injured by an insured car, in an accident. This policy does not include theft and damage to the insured car.
Commercial Vehicle Insurance
Vehicles used for business purpose are called commercial vehicles. These types of vehicles are used to carry light and heavy weight goods from one place to another. Commercial Vehicle insurance covers the loss or damage to the vehicles used for business purpose, complete third-party liability i.e. bodily injury, death or property damage in case of any mishap. Insurance is available for commercial vehicles like ambulance, trailers, buses, taxis, trucks, carriers, three- wheeler autos, and special types of vehicles like agricultural mobile rig, grabs, excavator, tractors, shovels, etc.
Two Wheeler Insurance
This insurance includes loss or damage to the vehicle and damage to third party in case of any unfortunate mishap. This insurance covers the two-wheeler from any man-made or natural calamities.
Add-On Covers
There is a list of add on plans available in the market which enhances your coverage for better protection. You can choose add-on covers according to your need, in addition to your standard motor insurance policy.
- Engine and Electronic Circuit Cover – In case of a damage to the insured vehicle’s engine or electronics circuits, this insurance cover takes care of your expenses.
- Zero Depreciation Cover – This is one of the most popular add-on cover in motor insurance package. Opting for this cover means that the policyholder is eligible to receive full claim amount on the value of replaced parts. In a comprehensive policy, deducts the depreciation value of the vehicle and pays the remaining amount for repair. Whereas if you have zero depreciation or bumper to bumper you are not needed to pay a single penny from your own pocket. The insurance company will pay full amount in case of any claims. It is to be noted that under this add on, most of the insurance companies allow claims only twice in one policy year.
- Consumables Cover – Under this cover, consumables or minor components like engine oil, gear oil, nuts & bolts, lubricants and similar items except fuel are replaced/refilled during repair are covered. However, the insurance companies do not pay for these consumables with the basic comprehensive policy.
- Roadside Assistance Cover – In case of emergencies like battery issues, empty fuel, flat tyres, and so on, this add-on cover provides you an assistance even in the remote locations. With a roadside assistance cover, you need not look for any garage in case your car got stuck somewhere. All you have to do is, just call your insurance company and they will assist you in all the possible ways like repairing the vehicle at the same point, arranging for a towing vehicle, arranging a ride for you, etc.
- Key Replacement Cover – This cover offers reimbursement for the cost of a substitute key, in case of a lost ignition key.
- NCB Protection Cover – The NCB or No Claim Bonus is a kind of reward given to a policyholder in case of not making any claims during the policy term. NCB protector cover, as the name suggests, gives a protection to your no claim bonus which you have gained during past years by not making any claims against your insurance policy. In case of zero claims or no claim, you can get up to 50% of the premium amount and with this cover plan you will be entitled to the bonus even after making claim.
- Loss of Personal Belongings – Personal belongings like laptop, smartphones, etc that are kept in the vehicle and affected in an accident are being taken care if you have this cover.
Tips for Buying Motor Insurance
- Third party insurance is mandatory according to Indian Motor Act but I advise you to take a comprehensive coverage with add-on. Because only third party insurance does not cover any loss or damage to you and your vehicle. With additional premium, number of add-on covers as above listed are available in the market.
- Claim Procedure: It is advisable that before buying an insurance from any company check their claim procedure carefully as well as its claim settlement ratio. It is easy to figure out online by doing a simple search for the company you are considering. Go with company which has best claim settlement ratio and easy claims process.
- Garages offering cashless facility: Checking the network for the dealership and cashless garages associated with the insurance company which you are considering for taking an insurance is also very important. Keep this in your mind and choose the insurance company that provides you a cashless facility along with hassle-free repair in case of any accident.