Written by Ajay Kapoor – 
& Megha Jain –
What is Motor Insurance?
Do you own a vehicle? If yes, then you must be familiar with motor insurance, but do you know everything about it to get the best possible insurance coverage for your vehicle?
Motor insurance is a risk-mitigating tool just like any other insurance policy, but unlike other insurances, it is ‘Mandatory’!
It can help you protect your vehicle and give you financial savings by providing comprehensive vehicle coverage in time of emergency.
Let’s understand all terminologies related to motor insurance and then choose the right plan to fulfill your insurance needs.
Compare comprehensive plans for your vehicle.
Meaning of Motor Insurance
Motor insurance is mandatory for vehicle owners to protect them from any potential losses that may arise to the vehicle due to accidents and theft. It also protects vehicle owner from property damage or physical injury to the 3rd party.
As per the Motor Vehicles Act, 1988, it is compulsory to at least buy a third-party insurance in India.
Instances such as road accidents, theft, or damage to the vehicle while driving are unpredictable. Such events can be upsetting as they might have a financial impact. But if you have a motor insurance, it can protect you from creating a massive dent on your finances.
Major types of Motor Insurance
There are primarily two types of motor insurance available in our country. And to improve the coverage one can opt for various add ons available up to certain age. The policyholder can choose the most suitable solution from various options available.
Comprehensive Motor Insurance
It provides coverage for third-party liability, damage to own vehicle due to theft, accident or natural calamities and personal injury cover.
Covered under comprehensive motor insurance-
- Personal injury or death in an accident
- Damage to the vehicle due to accident
- Theft of the insured vehicle
- Liability cover for third party property damage and bodily injury or death of the third-party driver
- Loss or damages due to natural calamities like earthquake, flood, etc.
- Loss or damage to the vehicle due to fire
Not covered under comprehensive motor insurance-
- Does not cover the depreciation of the vehicle
- Does not offer coverage if the vehicle gets damaged in case, you are under the influence of alcohol or drugs
- Loss or damage due to nuclear war or military attack
- Ageing of the vehicle
- Loss or Damage to the vehicle if you do not have a driving license
- Electric or Mechanical breakdown of the vehicle
Third-party liability
Third-party insurance provides damage cover for third-party vehicle as well as financial assistance if the third-party driver gets injured or dies in an unfortunate accident. The Motor Vehicles Act of India has made third-party insurance mandatory in the country.
Covered under third-party insurance–
- Financial liability cover to the third-party’s vehicle
- Liability cover to the third-party driver in cases like death, bodily injury, or disability
Not covered under third-party insurance-
- Loss or damage to the vehicle if you are driving without the valid license
- Loss or damage to the vehicle if person is under the influence of alcohol, or drugs
- Due to oil leakage if the vehicle’s engine gets damaged
Add-on covers for Motor Insurance
- Zero Depreciation– Everything in this world, wears and tears, including us! And so do our cars. This is called depreciation and it is calculated based on the age of the car. Though if you have a ‘zero depreciation’ add-on, the insurance company is liable to pay the value of the parts without deducting the depreciation amount.
- Roadside Assistance- There may be a case when your vehicle breaks down while driving. In such cases, the insurance company offers roadside assistance like towing, refueling, key replacement, etc.
- Engine Protection- It protects against damage caused to the engine or its parts due to water ingression or oil leakage.
- Personal Accident Rider- Fatal accidents can leave you disabled for life or lead to death. The personal accident rider option will be a boon in these circumstances, as it commits to secure your family’s future in your absence.
- Loss of Personal Belongings- There may be an instance that you lose your belongings, or your valuables get stolen. By opting for this add-on, the insurance company will compensate for the same.
