Vehicle Insurance guide

Introduction

Here is the detailed vehicle insurance guide for vehicle owners.

Vehicle insurance is to covers the risks that occurred to your vehicle.

The common risks that occur to our vehicles are mechanical problems, Denting problems, break down, etc.

When it comes to motor insurance in India, the number of registered vehicles in India is 210023289. This is from 2009 to 2015 statistics only. We can imagine the number of vehicles growing day by day.

But how many of these vehicles having their insurance renewed regularly? Though there are heavy fines imposed by the government, people tend to not renew their car/bike insurance. 

If we look at the statistics of vehicle accidents, as per the Ministry of Road Transport-India I 2018 alone a total of 4,67,044 accidents reported and 1,51,417 occurred also 4,69,418 persons injured.

So, from these stats, we can imagine what is the damage to the vehicles that are involved in these accidents and why insurance is important.

Types of Vehicle/ Motor insurance

The vehicle insurance types normally based on the risk coverage (amount).

There are 2 types of motor insurance

              1) Third-party insurance               2) Comprehensive insurance

Third-party Insurance:

This type of insurance only covers the damages that occurred to other vehicles during an accident caused by the insurance holder. This also includes the injuries or death cover to the third party. Some companies now providing cover the injury/ death cover for the insurance holder as part of third-party insurance.

If there are any damages that occurred to the insured person’s vehicle then those costs are not borne by the insurance company.

Comprehensive insurance

This type of insurance covers the damages occurred to another vehicle as well as insurance holder.

It covers theft and any natural disasters like fire, earthquake, etc.

Risks covered in motor insurance

Most vehicle insurance policies cover a wide range of risks.

Theft

if the insured vehicle is stolen, then the insurance company will pay back the amount that the insurance policy is agreed upon. The companies apply some conditions when insuring the vehicle for theft cover.

It is possible that if the vehicle is stolen from an unsecured parking place then the insurance company may refuse to pay the insurance amount.

So, when taking insurance reading all the conditions is very important.

Fire

Another risk that is normally covered under motor insurance is Fire. If the vehicle under insurance is caught with fire and damaged, then as per policy rules the amount will be paid by the insurance company.

Natural disasters

If the vehicles are damaged because of natural calamities like floods, thunder, etc then the insurance can be claimed.

Reasons to buy motor insurance

The reasons are obvious, when some damage occurs to the vehicle then it will be a burden on the vehicle owners to repair it or replace it with a new vehicle. In this scenario, if the vehicle is insured the financial burden will be lower on the vehicle owners and damages can be claimed from the insurance companies.

Also, if the insured vehicle causes an accident and causes injuries to other people in transit it is a big risk for vehicle drivers, so having insurance is a big plus to avoid these financial risks.

Vehicle insurance claim

The motor insurance claim is based on the damage or risks occurred to the vehicle.

Here are the steps to follow when claiming motor insurance.

1. Report to the police in case of theft/fire/accident

2. Call the insurance company and explain the situation

3. Fill the claim form, provide only the correct information. Otherwise when a surveyor comes and checks your vehicle and there are any discrepancies then your whole claim may be rejected.

4. Keep all your bills and documents safe if you paid for vehicle repair.

5. provide the same documents to the insurance company.

Timelines

Below are the timelines that an insurance company should obey in terms of insurance claims.

Survey report submission – 30 days.

An insurer seeking addendum report – 15 days.

Settlement/rejection of Claim after receiving the first/addendum survey report – 30 days.

IRDA Handbook of Motor Insurance