Just like life or health insurance, motor insurance is a type of insurance cover that offers protection for your vehicles. The only difference is that it is a regulatory requirement thereby requiring all vehicle owners to buy one. Be it private vehicle or a commercial vehicle, insurance is mandatory. This Motor Vehicles Act of 1988 stipulates this requirement. The insurance companies levy an amount for such coverage known as the premium. This premium is based on the coverage the policy offers. Here are the types of motor insurance policies that you can buy –
Car insurance policy
The names of the policies are self-explanatory as regards to the type of vehicle they offer coverage for. A car insurance policy is that which all owners of private cars are required to purchase.
Two-wheeler insurance policy
As cars have a separate motor insurance policy that needs to be bought, similarly, two-wheeler insurance policies are separate. These two-wheeler insurance policies cover all types of two-wheelers, be it a bike or scooter or a moped. Any private vehicle that is classified as two-wheeler by the registering RTO needs to purchase a two-wheeler insurance policy.
Commercial vehicle insurance policy
The above two policies specifically deal with vehicle having a private registration. However, not all vehicles are registered for private purposes. Some are specifically purchased by business organisations for its logistic operations. This is where commercial vehicle insurance is required.
The above classification has further division into different types based on the policy coverage offered. This is divided into third-party plans and comprehensive plans.
A third-party policy is most basic coverage that needs to be purchased. Here, the insurance company takes car of the legal liabilities that may arise due to an accident or collision injuring a third person or causing damage to its property. The final compensation payable in case of third-party liabilities is decided by the Motor Accident Claims Tribunal based on which the insurer compensates the aggrieved person.
While third-party car or bike insurance has limited coverage, a comprehensive policy has three components – third-party cover, own damage cover and personal accident cover. While the third-party coverage is same as per the third-party policy, an own damage cover provides for losses to your vehicle. In addition to that, the personal accident cover is which provides compensation for death or disablement, be it temporary or permanent in nature to the policyholder.
When you purchase a bike insurance or buy car insurance online, you have the facility to customise the coverage in a comprehensive policy. This is possible using add-ons that are optional features that enhance the policy scope. This way, if you wish to add protection for the engine or a depreciation cover for your vehicle, it is possible. There are various add-ons that are offered by the insurance companies, however, not all of them might be useful in your case. Selection of the right add-ons is essential. Since they are extra policy features, they bump up the premiums thereby making your insurance policy expensive. To keep it within your budget, you can make use of a vehicle insurance calculator too. This nifty tool not only helps to know the impact of policy features on premium, but also aids in the comparison process. 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.