Accidents are unfortunately very frequent in our country. With hardly anyone following traffic rules, damages are very common resulting in both - a financial loss and loss of mobility. Although the Indian law makes it compulsory to insure your vehicle against third party liability, but prudence also suggests a comprehensive cover for your vehicles
Motor insurance is a contract between a vehicle owner and the insurance company where the insurance company compensates for the loss arising from accidents, burglary, or third party injuries/death. It can also cover any personal injury, to you or to your passengers due to a mishap.
There are two types of motor insurance –
Package policy (Comprehensive insruance cover)
Liablity only policy (Third party insurance cover)
Package policy covers risk arising out of the following:
Physical damage to the vehicle, theft, transit etc
Death of the driver and/or passengers in the vehicle
Damage caused by the vehicle to other people or property
Liablity insurance covers only damage caused by the vehicle to other people or property. The liability is covered for an unlimited amount in case of death or injury. Damage to third party property is covered by the insurance policy as follows - up to Rs. 1 lakh for private vehicles, scooters, and motorcycles and up to Rs.7.5 lakh for commercial vehicles. The India Motor Vehicles Act, 1938 has made it mandatory for every owner of a vehicle to obtain a motor insurance policy, either a package or liablity insurance. As evidence, a Certificate of Insurance must be carried at all times in the vehicle.
The Policy Covers:
The policy is convenient and easy to understand, with easy documentation and hassle free claims service The policy can be issued to cover all types of private cars, Commercial vehicle, two wheelers etc
A comprehensive Car Insurance protects you against any loss or damage caused to the vehicle and its insured accessories as a result of natural and man-made calamities, such as:
Natural calamities: Fire, Explosion, Self-ignition or lightning, Flood, typhoon/ hurricane/ storm/ tempest/ inundation/ cyclone/ hailstorm/ frost, Landslide/rockslide, Fire and shock damage due to earthquakes.
Man-made calamities: Burglary, Housebreaking or theft, Riots or strikes, Accidents by external means, Malicious acts, Terrorist activity, Damage whilst in transit by road, rail, inland-waterway, lift/elevator, or air
Legal liability of insured towards third party personal injury and property damage arising out of an accident involving the insured vehiclePersonal accident cover:The motor insurance plan compulsorily provides personal accident cover for individual owners of a vehicle while driving. The owner can also opt for personal accident cover for passengers in the vehicle
Undertakes to reimburse the expenses incurred :
- Towards repair/replacement of parts of the vehicle, or
- To pay the market value of the vehicle in case of a total loss, provided that the originating cause of such damage is an accident, including theft.
What is covered under Motor Insurance Policy:
The Package Policy covers
1. Accidental Loss of or damage to the Vehicle
2. Liability to third parties, Personal accident cover to owner driver.
3. Various Add on Covers on extra premium
Loss or damage to two wheeler caused by :
4. Accidental external means.
5. Burglary, House Breaking or Theft.
6. Fire, Explosion, Self Ignition & Lightening.
7. Earthquake, Flood, Storm, Landslide or Rockslide, Inundation, Terrorism, Riots, Strikes, Malicious Acts
8. Transit by Road, Rail, inland waterways, air or lift.
What is the Amount of Insurance:
The amount of Insurance will be Insured Declared value of the Vehicle (IDV). IDV for vehicle less than five years old is the Manufacturers listed selling Price which is adjusted for Deprecation based on age of Vehicle. For vehicles beyond five years of age and obsolete vehicles, the IDV is mutually agreed value.
How is Premium Calculated :
The Premium calculation is based on the following factors:
1. IDV of the vehicle
2. Cubic Capacity of the vehicle
3. Zone of Registration
Age of Vehicle Additional Premium for :
(i) Electrical & electronic items
(ii) CNG/LPG FUEL
(iii) Add on Covers
(iv) Extra Benefit
What is the Period of Insurance :
Coverage period is for one year, however shorter duration covers are also available.
What is not covered under the Two Wheeler Package Policy:
1. Damage by a person driving without a valid driving license
2. Mechanical or Electrical breakdown, failure
3. Damage by a person driving under the influence of liquor/ Alcohol/ Drugs
4. Depreciation, any consequential loss
5. Loss/Damage attributable to War/Mutiny/Nuclear risks
6. Damage to tyres/tubes, unless damage to the vehicle in the accident with liability maximum fifty percent of value.
7. Damage, outside India unless covered by extra premium for Nepal, Bhutan & Bangladesh, Pakistan, Sri Lanka &Maldives
8. Two Wheeler being used for Hire or Reward, speed testing, or Racing, Reliability Trials.
9. Loss of or Damage to accessories by Burglary, Housebreaking or theft unless the Vehicle is stolen at the same time.
Discounts in Premium:
Following Discounts in premium may be granted:
a) Voluntary Deductible
b) Discount for anti theft Device
c) If no claim is preferred in the expiring Policy, a Bonus or Discount named NO CLAIM BONUS is given on the Premium of the new Policy.
d) Automobile Association discount
What does liability to third parties means in the coverage:
If the insured vehicle causes Injury/Death and/or Property Damage to a third party, the legal liability arising out of the same to a third party is covered under liability to third parties
What is the Period of Insurance :
Coverage period is for a year, however shorter duration covers are also available.
Important Policy Conditions:
Immediate Notice shall be given to the company in writing upon occurrence of accidental loss/Damage. The company at its discretion repairs, reinstate or replace the vehicle insured. Insured shall take all steps to safeguard the vehicle and company has the right to inspect it at any time.