Motor insurance is an obligatory requirement if you own a vehicle in India. Different types of motor insurance are available in the market. All these insurance policies cater to the different coverage requirements of vehicle owners. These policies are categorized according to the type of vehicle they insure, coverage offered, and coverage period.
As per the Motor Vehicles Act, every vehicle on Indian roads must carry a valid insurance policy to run legally. Choosing the best motor insurance ensures comprehensive protection, offering financial security in case of accidents, theft, or damages. Without wasting any time, let’s understand the different types of motor insurance policies based on the categories that you will find in the motor insurance market.
Types of Motor Insurance
When it comes to different types of motor insurance offered in India, there are three choices an individual can choose from; let’s find out how many types of motor insurance are available in the market:
Private Car Insurance
You can opt for car or private car insurance for private-use four-wheelers, like SUVs, sedans, hatchbacks, etc. The features of motor insurance give financial protection for your personally used vehicles.
- The policy protects you from theft, fires, accidents, and other natural calamities.
- The policy covers third-party liabilities, including fatalities, injuries, or property damage from accidents involving insured cars.
Though third-party coverage is mandatory as per the Motor Vehicle Act of India, having your personal damage insurance is better for comprehensive coverage. However, it excludes any damages from breakdowns, drunk driving, invalid licenses, wear and tear, or incidents outside its specified area and commercial use. Benefits of motor insurance include financial security, protection against unforeseen expenses, and peace of mind knowing that damages and liabilities are covered under a suitable policy. It is essential to note this policy type doesn’t apply to cars used for commercial purposes.
Two-Wheeler Insurance
A two-wheeler insurance plan mainly covers two-wheelers such as bikes or scooters and is made compulsory by the Indian Government. Hence, ensure you check out what are the different types of motor insurance available for your two-wheeler insurance.
- This insurance covers damages from accidents, fires, disasters, theft, and other causes, as well as injuries and damages to third parties.
- It provides mandatory accident cover for an owner rider, and you can also add cover for the passenger/ pillion rider.
- Third-party insurance policy is obligatory & covers even third-party losses. The standalone own-damage policy covers an insured vehicle.
- A comprehensive insurance policy covers third-party liabilities and personal damages.
- The inclusion plan covers artificial and natural damage, and exclusions involve lack of valid documentation and drunk driving.
Commercial Vehicle Insurance
Commercial motor insurance covers vehicles not used for personal reasons. It ensures that business operations run smoothly by offering financial security against adverse events.
- This insurance type covers any vehicles used for business purposes, including trucks, heavy and light commercial vehicles, buses, agricultural vehicles, multi-utility vehicles, taxis or cabs, auto-rickshaws, ambulances, etc.
- Key features are comprehensive coverage for private and public carriers, compensation for any unexpected expenses, and liability for accidents.
- It even addresses third-party damage & provides personal accident coverage. The war perils, wear and tear, and usage limitations are excluded.
Types of Motor Insurance Policies
The types of motor insurance claims can be classified as third-party insurance, comprehensive, and personal accident cover.
Third-Party Liability Insurance
Third-party insurance coverage is the most basic insurance. It protects you and your vehicle from damages or losses caused to third-party property, individuals, or vehicles by an insured vehicle. Having a third-party insurance policy is compulsory for driving on roads.
Comprehensive Insurance
Comprehensive insurance covers a wide range of risks. In addition to third-party liability, it safeguards against any damages/losses caused to an insured vehicle and offers other optional coverage choices.
Personal Accident Cover
Personal accident insurance protects a car owner from accidental injury or death. According to IRDAI, an insurance company can provide coverage up to INR 15 lakhs. This policy also covers medical costs and compensation for any disability or death
Add-On Covers
There are additional insurance covers that will increase your vehicle’s safety. They are:
- Zero Depreciation Cover: With an additional premium, this cover will protect against additional depreciation charges.
- No Claim BonusThis cover protects against NCB discount when claimed during its policy term.
- Engine Protector Cover:This add-on compensates for any expenses incurred to repair the engine due to damage or loss caused by fire, water, or natural disaster.
How do you choose the right insurance for yourself?
When buying any insurance policy, it is very important to consider the claim settlement ratio, cover range, add-on protection, policy portability, geographical location, policy terminology, and safety features. Now that you know the different types of motor insurance available, finding the right insurance policy that suits your requirements will be simple.
Conclusion
Universal Sompo’s motor insurance offers complete protection against financial loss. The policy covers financial loss due to natural disasters, theft, or accidents. A vehicle owner can even buy it online. However, conducting thorough research before making your final decision is important.
FAQ
It is essential to get a minimum of third-party motor insurance according to law. It covers injuries and damages caused to a third party, offering compliance legally and financially.
The two major motor insurance claims include: Cashless and Reimbursement. While a cashless claim covers a network garage, reducing your pocket expenses, a reimbursement claim clears repair charges and later gets reimbursed by the insurer.
It is essential to get motor insurance as it offers financial security against theft, damage, or third-party liabilities. It offers legal compliance along with mind satisfaction during accidents.
It includes the policyholder and owner of the car.
Refers to the insurance company providing the policy.
Refers to any person or property affected by the insured vehicle. Third-party insurance covers damages to the third party, while comprehensive policies protect the first party as well.
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