Motor Insurance
Third-Party Liability Insurance
This is the minimum mandatory insurance required by law for all vehicles plying on Indian roads. It covers the policyholder’s legal liability for any injury, death, or damage caused to a third party or their property due to an accident involving the insured vehicle.
Comprehensive Insurance
This type of insurance offers wider coverage compared to third-party insurance.It includes coverage for damages to the insured vehicle in addition to third-party liability.It typically covers damages due to accidents, theft, fire, natural calamities, and man-made disasters.
Key Aspects of Motor Insurance
Insured Declared Value (IDV)
This is the maximum amount that the insurer will pay in case of theft or total loss of the vehicle.It is calculated based on the manufacturer’s listed selling price of the vehicle and its depreciation over time.
No Claim Bonus (NCB)
This is a discount offered by the insurer on the premium for every claim-free year.The NCB can go up to 50% of the premium after five consecutive claim-free years.
Add-on Covers:
These are additional covers that can be purchased along with the base policy to enhance the coverage.Some common add-on covers include zero depreciation cover, engine protection cover, roadside assistance cover, etc.
Importance of Motor Insurance
Legal Compliance
It is mandatory to have at least third-party insurance to drive a vehicle legally in India.
Peace of Mind
It gives you peace of mind knowing that you are financially protected in case of any mishap involving your vehicle.
Financial Protection
It protects you from financial losses arising from accidents, theft, or any other unforeseen events related to your vehicle.
