As a vehicle owner, you must have definitely come across the requirement to buy a motor insurance plan. You should buy one not just for the sake of complying the law, but with caution to safeguard your car or bike.
A vehicle insurance plan is required for all types of vehicles registered in the country, commercial as well as privately owned. Its basic function is providing protection to you, the policyholder, against losses and damages to your vehicle as well as any legal liability arising due to accidents or damages to a third person.
Types of insurance plans
Driving without a valid insurance certificate in a legal offence and hence, the Motor Vehicles Act requires compliance for which a motor insurance is a necessity. This law mandates your insurance cover is equipped with at least third-party coverage.
As the name suggests, third-party insurance cover offers protection from legal liabilities. Such liabilities may arise due to an accident or collision injuring a third person or causing a property damage. Hence, it is also called as a liability-only insurance plan. This policy provides limited coverage and hence not preferred by all.
Safety-conscious drivers prefer a comprehensive insurance policy for its all-round coverage it offers against own-damages, third-party liabilities as well as a personal accident cover. Own-damage cover includes the damages to your vehicle due to natural calamities like hurricanes, earthquakes, floods, cyclones, etc. whereas man-made perils include riots, vandalism, fires, strikes, etc. In addition, theft of your vehicle is also included under a comprehensive policy’s own-damage cover. The third-party component is the same as a liability-only plan whereas a personal accident cover provides compensation to you, the policyholder, in the event of disability or death during an accident. However, it is not mandatory to buy a personal accident cover if you already have one. * Standard T&C Apply
Insurance Premiums and its sum assured
The regulatory body, Insurance Regulatory and Development Authority of India (IRDAI) governs the insurance sector and hence motor insurance premiums are regulated by IRDAI.
IRDAI specifies the premium for a third-party plan wherein the premium is based on the engine capacity of the vehicle. Considering a third-party policy is the bare minimum insurance cover, it is entirely under the control of the regulator. But that isn’t the case for comprehensive plans. You can visit the official website of IRDAI for further details.
The own-damage component of a comprehensive policy is determined by the insurance company not on any one factor, but a combination of many. Insured declared value, engine capacity, model and manufacturer, coverage opted, add-ons selected are some of the basis on which premiums for own-damage cover is determined. Such own-damage premium along with the standard rates for personal accident cover and third-party cover in aggregate determine the premium of a comprehensive policy. When making your vehicle insurance online payment, make sure to keep in mind these factors. * Standard T&C Apply
Few other pointers
- When buying a motor insurance plan, make sure you have a clear idea of how much insurance coverage you need.
- It isn’t mandatory to buy motor insurance from the vehicle dealer only. You are free to select the choice of your insurance policy.
- Make sure to be thorough with the inclusions and exclusions of your insurance policy. All of them can be found in the policy terms and conditions.
- Using a vehicle insurance calculator can help you compare and choose the right insurance plan not only based on premium, but also its features.
* Standard T&C Apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.