Motor Insurance

Motor Insurance

Driving is a privilege, but it comes with a price tag. There's the cost of the vehicle itself, maintenance, repairs, fuel and auto insurance. Many states require you to carry a basic, minimum level of auto insurance. It's a way of sharing the risks of driving. You pay premiums to an insurance company for coverage. In return, your coverage will protect you against most financial losses that might otherwise be staggering.

Auto insurance is more than a matter of insuring your vehicle for loss or repairs after an accident. It is a financial safety net that can help you offset the cost of:

  • Bodily injuries to yourself or others
  • Lost wages due to injury
  • Benefits to survivors when an accident results in death
  • Lawsuits brought against you as the result of an accident
  • Repairs made to your car due to damage caused in an accident

This Web site will guide you through some important decisions about your automobile insurance. How much coverage do you really need? How much liability insurance? Is there any way to save money on auto insurance? First, you'll need to know just what kinds of coverages are available. Many states require a basic liability coverage, but you must decide how much additional insurance you need. You select a package of insurance from standard types of coverage - a package that will protect you, your family, your vehicle and your assets. Your particular package could include:

  • Bodily Injury Liability
  • Property Damage Liability
  • Collision Coverage
  • Comprehensive Coverage
  • Medical Payments Coverage
  • Uninsured/Underinsured Motorist Protection

BASICS

What is insured ?

Any light motor vehicle used for social, domestic and pleasure purposes and for the insurer's business.

Insured against what risks?

  1. Following is the list
    1. Loss or damage by accident, fire, lightning, self ignition, external explosion, burglary, housebreaking or theft, malicious act.
    2. Riot and strike; terrorism; earthquake; flood, cyclone and inundation.
    3. whilst in transit by rail, road, air, elevator, lift. Perils under 1(b) can be deleted and a discount in premium availed.
  2. Liability for third party injury/death, third party property and liability to paid driver.
  3. On payment of appropriate additional premium, loss/damage to electrical / electronic accessories, PA cover for drivers, insured or any named person, unnamed passengers can also be taken.
  4. Certain discounts in premium are also available.

Who can insure?

Individuals and corporate owners of the private cars and the financier of the car having insurable interest in it.

 

What will policy pay and how much?

Own Damage

  • Actual amount spent for repairs/replacement subject to depreciation and sum insured as per survey report.
  • Garaging and towing charges - up to Rs 1000/-
  • Damage to tyres (when vehicle is also damaged) - 50 % of cost of replacement
  • In case of total loss, market value at the time of loss or sum insured whichever is less.

Act Liability

  • Death or bodily injury to third parties - Unlimited
  • Death or bodily injury to any person carried in the car provided they are not insured employees and not carried for hire or reward - Unlimited
  • Liability to paid driver - As per W. C. Act
  • Third party property damage - up to Rs 6000/-
  • All costs and expenses incurred with company's written consent.

In case of death of the Insured/any person entitled to indemnity for a liability incurred under this Policy,his personal representative will be indemnified ,as in the case of insured,if he observes all conditions as the insured himself.

 

When will policy not pay?

Consequential loss; depreciation; wear and tear; mechanical and electrical breakdown; failure or breakage.

When vehicle is used outside the geographical area; when used contrary to limitation as to use; driven by a person other than the driver stated in driver's clause. War perils, nuclear perils and drunken driving.

 

COMPREHENSIVE INSURANCE

This type of insurance covers all the risks covered in the Motor Vehicles Act, plus loss or damage caused to the vehicle due to:

  • Accident
  • Fire, Explosion, self-ignition, lightning
  • Burglary, house-breaking, theft
  • Riots & strikes
  • Earthquakes
  • Flood, typhoon, hurricane, storm, cyclones
  • Malicious acts
  • Terrorism
  • Transit by rail/road. air, waterways

Also included is the towing charge (up to Rs.1, 500/- for private vehicles and Rs.2, 500/- for commercial vehicles) incurred due to accident to the vehicle.

Exclusions to the Comprehensive Insurance Cover

This insurance does not cover loss or damage caused due to:

  • Driver being under intoxication
  • Vehicle being driven by a person not holding an effective, valid licence

It also does not cover:

  • Damage to tyres (unless the vehicle is also damaged).
  • Wear & tear, mechanical breakdown.

Calculation in the case of Comprehensive Insurance Cover:

In the case of Comprehensive Insurance Cover, for the purpose of premium, vehicles are categorized as follows:

Private Car:

This is used for personal purposes. The premium is computed on the following basis:

  • Geographical area of use and cubic capacity
  • Value of the vehicle. Accessories are to be specified separately under electrical and non-electrical items.

Two-Wheeler:

This is used for personal purposes only. Premium is calculated on cubic capacity and value of vehicle. Accessories are to be specified. Theft of accessories is not covered, unless the vehicle is stolen at the same time.

Commercial Vehicle:

This is a vehicle used for hire and is classified into:

  • Goods-carrying commercial vehicle: In this case premium is calculated on carrying capacity -gross vehicle weight and value of the vehicle. Accessories extra, as specified.
  • Passenger-carrying commercial vehicle: In this case premium is calculated on carrying capacity of the vehicle -Number of passengers and value of the vehicle. Accessories extra, as specified.

Note: all commercial vehicles are subject to compulsory excess in each and every claim for damage.

 

FILING YOUR CLAIMS

There is danger at every corner when it comes to Indian roads. Automobile insurance plays an important role in protecting consumers from serious financial losses that result from accidents

Filing an auto insurance claim

At the scene

  • Stop and get help for the injured.
  • Call the police and notify the nearest medical unit.
  • Provide the Police with the information they require.
  • Take steps to protect your car from further damage. Your Insurance Company will probably want to have someone inspect it and appraise the damage before you order the repair work done.
  • Record the details of the accident.

Filing your claim

  • Phone your insurance agent. Do it as soon as possible even if you are far off from home and even if someone else caused the accident.
  • Ask your agent on how to proceed and what forms or documents will be needed to support your claim. Your company may require a "proof of loss" form, as well as documents relating to your claim, such as medical and auto repair bills and a copy of the police report. Supply the information your insurer needs.
  • Keep records of your expenses. Expenses you incur as a result of an automobile accident may be reimbursed under your policy.
  • Keep copies of your paperwork. You may need to refer to it later.

THIRD PARTY INSURANCE

Third Party Insurance covers:

  •     Personal Injury
  •     Property damage

Third Party Insurance cover for Personal Injury includes:

Liability for death or injury to third parties - this means that you are insured against death or injury (caused by your vehicle) to pedestrians, occupant of other vehicles, and outsiders other than passengers, for unlimited amounts. Passengers of private vehicles and pillion riders are also deemed covered.

Liability to employees connected with operation of the vehicle - this means you are insured against death or injury (caused by your vehicle) to the vehicle's drivers, cleaners, conductors, coolies etc. , employees used in the operation of the vehicle.

Liability to passengers carried in the vehicle for hire or reward - this means that as an owner of a taxi, bus or auto - rickshaw, you are insured against death or injury (caused by your vehicle) to the passengers

 

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