Commercial vehicle insurance, as the name implies, is a type of insurance that covers the financial risk of vehicle damage. It is also known as automobile insurance or motor insurance. The policies cover four-wheelers, three-wheelers like autorickshaws, and two-wheelers.
How does a vehicle insurance policy function?
Vehicle insurance protects you against damage caused by accidents, third-party damage, traffic collisions, and collisions with other objects. Vehicle insurance may also include coverage for damage caused by weather or natural disasters. This includes non-personal vehicle insurance such as car, bike, and commercial vehicle insurance.
Provision for coverage:
The coverage provided is determined by the amount of insurance selected by the vehicle owner and the terms set by the insurance provider. Furthermore, the specific terms of a vehicle insurance policy for a new policy or a commercial vehicle insurance renewal, differ from regional legal regulations. Vehicle insurance policies include the following three types of coverage:
- It covers treatment costs for the owner/driver in case of an accident or collision.
- The vehicle insurance policy covers the medical expenses for injuries and rehabilitation.
- In some cases, lost wages or funeral expenses may be claimed.
Vehicle insurance coverage exclusions and clauses:
Claiming coverage under a commercial vehicle insurance online or offline policy is subject to specific terms and conditions. Certain situations are expressly excluded and are not covered by the policy, including:
- There is no coverage for underage drivers or those who drive without a licence.
- If you are behind the wheel while under the influence of alcohol or drugs and have an accident, you will not be covered by insurance.
- Damage caused by a war/nuclear attack
- Damage caused by ageing of the vehicle, wear and tear, no/low maintenance, or mechanical failure/breakdown.
Vehicle insurance policy types
Different types of policies cover various kinds of losses. For example, a specific commercial vehicle insurance policy may cover accidental damage, not theft. Similarly, car insurance and bike insurance policies may differ. Vehicle insurance policies are classified as follows:
- Third-party protection
This type of vehicle insurance policy protects you against third-party damage or injury. This does not cover accidental injuries/damages caused by the owner/driver’s fault or theft. A third-party vehicle insurance policy typically has a lower premium than others.
- Personal damage insurance
A vehicle or parts of it may be lost due to theft or natural causes such as fire, weather conditions, etc. It can also occur due to man-made issues such as vandalism, riots, etc. Own damage insurance covers these damage and repair costs, as well as the costs of repairing or replacing belongings in the event of an accident. *
- General liability insurance
This policy provides financial protection for both third-party liabilities and own damage. It is a comprehensive policy that offers complete protection against various types of damage and end-to-end coverage. There is also a deductible and a higher premium.
- Collision coverage
This automobile insurance policy covers damage caused by a collision with a stationary object or another vehicle on the road. It covers damage caused by potholes or vehicle rolling. There is no coverage if the car breaks down or suffers wear and tear. However, most insurance policies cover these costs.
- Additional regulations
Aside from the main types of coverage discussed above, the insured can purchase additional motor insurance policies as add-on policies. Glass Insurance (under car insurance) covers the costs of rear/side windows and sunroof glass damage.
* Standard T&C Apply
** Currently, there are 2 tax regimes in India – new and old. To get the tax benefit you desire, choose the correct one after consulting an expert. You can opt for a regime change during the next financial year.
# Visit the official website of IRDAI for further details.
## All savings are provided by the insurer as per the IRDAI-approved insurance plan. Standard T&C apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.