What is Motor Insurance ? 

Hey guys welcome to in this blog we would be learning about the topic motor insurance. This blog is a part of general insurance module. So I recommend you to watch all other related Blogs to this.

Let's start with the introduction before going on to motor vehicle insurance. Let me give you a brief of our general insurance. so all that is non-life is referred as general insurance which comprises of motor insurance, fire insurance, then marine insurance, etc.

What is Motor Insurance ? 

So this was a brief about general insurance to give you an idea and thus motor insurance is a part of general insurance module.

Motor Insurance.

So let's start with the introduction of it. Motor vehicle insurance is the insurance coverage of risk arising out of the use of motor vehicles such as car, truck or other vehicles causing damage and loss to oneself as well as others property in an accident.

so motor insurance is also motor insurance you could refer whenever you are taking insurance for the coverage of risk that could arise in form of damage or loss to your own vehicle on may be you are causing damage to someone else's vehicle in sort of any accident on road.

Thus it becomes mandatory to get a motor insurance which will insure your car as well as your life in case of any accident, any injury caused. Let's see motor insurances mandatory as per the Motor Vehicles Act passed in the year 1938 and subsequently amended,

So this has been mandatory because whenever you are driving on road it's not usually that in an accident only your car will be damaged or only injury to yourself would be happening in any sort of accident.

You may be damaging someone else's property and someone else's life and thus it has been mandatory to take motor vehicle insurance and this comes under Motor Vehicles Act that was passed in 1938 and this Act has been subsequently amended many times.

Now in recently there was an amendment made because of which the compensation on various traffic rules violation was increased motor insurance provides coverage related to property damage bodily injury medical expenses and any other sort of compensation in legal proceedings.

So what all thinks it provides coverage for it provides coverage for property damage - so either your vehicle has been damaged or any property related to it your bodily injury, any kind of injury you met in an accident then the medical expenses which you have to incur because of those injury which happened throughout the accident on the road with another vehicle or maybe any sort of compensation.

So many a time it happens that in an accident may be the other party would be suing on you because of your mistake of violating traffic rules, so in that come in that scenario you may have end up paying a large amount of compensation demanded by the other party.

So insurance also provides you coverage for those compensation which is involved in any sort of legal proceedings arising due to accident on road by third party.

What are the types of Motor Insurance ?

Now motor insurance you can also refer it as auto insurance, vehicle insurance or car insurance. Let's see what are the types of motor insurance.

Private Car Insurance.

So first one is private car insurance whenever you are taking insurance for your own vehicle which you have to run for your private users or no commercial uses. so that would be referred as private car insurance.

Commercial Vehicle Insurance.

Second is commercial vehicle insurance. so insurance which you are taking for the vehicle which is going to be used for commercial purposes which would be involved in any sort of business delivery business transportation business etc.

Defense Vehicle Insurance.

Then Defense vehicle insurance. so the insurance for the vehicles which are involved in your defense like the heavy vehicles which are there in the different segments.

So taking insurance for those workers and then there is two Miller insurance for your tubular vehicles which you own so the insurance for that would be referred as tubular insurance and here you can signify that you have to when you are taking insurance you have to mention the type of the car you own as well as the use of that vehicle.

so it's very much in the policy that you have to mention the use of that vehicle whether you will be using it for your private purpose or for business purpose or will it be involved in any sort of defense activity,

so all those things you have to mention while taking insurance policy because that is what that would be combining the premium amount which you would be paying for your insurance policy.

What is Third-Party Liability.

Now let's see what is third-party liability, so we already referred as third-party liability lips understand is, so motor vehicle insurance generally comprises of following two components.

First one is third-party liability which is mandatory and second one is owners damage which is optional. so motor insurance when we say that it is compulsory or mandatory that is because of third party liability.

So third party liability is when you are ill when you met an accident and you are causing damage to another person's property or another person's life or any injury so it becomes important that you take insurance which would be providing coverage to to help out that person to recover from that injuries or property is damaged.

So third party liabilities does mandatory whenever you are driving on the road you are getting the vehicle the driving the license for your vehicle you may you must have to take the third party liability which would be comprised in the insurance policy.

The motor insurance policy which you would be taking and then the owners damage is optional. so the damage which would be happening to your own vehicle. so that is optional you may take or you may not opt out for it.

let's see third party liability coverage is the part of insurance policy which protects you in case you are sued or asked compensation for any physical injury or damage to someone else's property by your vehicle accidentally.

so any sort of accident in which you are causing damage to some other person without the other person's fault it becomes necessary that your insurance policy protects you to pay compensation to that person to go recover from that injury or that property damage third-party liability could be of following nature.

so it may be bodily injury cause to the third-party that it's the another person or it may be the property damage. so any sort of property damage which you are causing to their vehicle or their property. so that would also be covered under this.

Now let's see factors affecting premium, so what all things determine the premium which you have to pay on the motor insurance policy, so these are broadly for categories type of vehicle,

So type of vehicle now what sort of Becker you are using whether it is two pillar whether it is private car, commercial vehicle etc. so that will be determining the premium because you see when you are using commercial vehicle that would be more prone to risk because that would be involved in business day to day activities whereas private car would be used less as compared to commercial vehicles as the premium would be less because their risk would be less as compared to the commercial vehicles.

so whenever you are taking insurance, motor insurance it becomes mandatory that you mention all these things that for which purpose you are owning the vehicle and in sort that you will try to mislead the insurer.

It may deny to give you the coverage whenever it will come to know about the purpose of the vehicle for which you have taken the insurance. if it differs from the purpose which you have mentioned while taking the insurance.

Thus it becomes important that you mentioned the type of vehicle the use of the vehicle etc. while taking the motor insurance policy

Fiscal Condition of the driver.

Second is fiscal condition of the driver, so it also depends on the fiscal condition of driver because if the driver is not to healthy enough and he's not having so much of skills of driving and may be disability in any sort.

so there is more risk that there would be an accident on the road and as the premium involved would be higher as compared to a driver which who is in healthy condition geographical area of use.

so this also determines the premium amount because the geographical area determines the risk involved. so maybe you are driving in more populated as compared to when you are driving in any rural area or maybe you are driving on hilly areas which are more prone to risk as compared to the city areas.

Thus the geographical location where your vehicle would be used where you are taking the motor insurance policy that would determine the premium because that would differentiate in their risk involved in that particular location and the age of meckel's.

so the age of your vehicle how much you have used and because with every use of your vehicle it goes through depreciation wear-and-tear happens to your vehicle and that's the in risk involved of getting into accident or any shot of damage becomes higher.

So the premium would depend on that as well.

Coverages and Exclusions.

Now let's see some of the coverages and exclusions. so loss or damage covered in motor insurance loss of damage by accident fire lightning any sort of theft or malicious activity natural disaster.

All these would be covered under motor insurance policy then the third party liability which we already discussed in form of injury death and damage to others property that would also be covered in the motor insurance policy and then any sort of medical expenses due to those injuries or death of any person. so that would be covered under my insurance policy.

Now what are things would not be covered. so there are exclusions it won't be paying you for every small damage to your vehicle. so normal wear and tear which happens to have any scratch or any broken glass that won't be covered damage when person was driving without license.

so if damage happens because of your fault if you were driving without having a proper license then that won't be probably the insurance company would deny your claim and want to be providing you the coverage amount damage which happens when the person was driving in influence of alcohol.

so it is prohibited to drink and drive but till after that also if you were drinking and then driving and any sort of damage or accident happens.

so the insurance company could deny your claim and would not provide you coverage then damage due to a bar which is and which is exceptional situation. so that is not covered under insurance coverage policy.

The add-on covers.

Let's see some of the add-on covers which you could take other than the main policy you can also opt or opt out for some add-on covers which would help you in total protection of your vehicle.

so first one is zero depreciation cover. now in this you get the whole cost of repairs to external car body damage irrespective of the depreciation amount.

so as I already mentioned that your vehicle with the users and the passes of time it will go through depreciation it will not be having the same value after five year users or six year uses.

It's valuable you learn decline and so it's capacity also so the depreciation amount so in case you are vehicles it has been more and it has gone through a lot of wear and tear and depreciation.

so the insurance company will won't be providing you the full amount it will be deducting the depreciated amount and then will be providing you the coverage. now this add-on cover will help you get the repairs or replacement of plastic and fiber components of your car that goes through depreciation.

so in this case the depreciation amount won't be deducted the full amount would be repaid to you by the insurance. now why would you opt on for this add-on cover this would help you get the total value of your repairs or replacement irrespective of the depreciation amount of your vehicle and what you would have to pay.

So you would have to pay a little higher premium as compared to the normal car insurance policy when you opt for any add-on cover you would be end up paying a little higher premium as compared to the normal policy.

Engine Protection.

Second is engine protection cover so an engine protection cover is an add-on add-on to your car insurance policy that is meant to cover any damages to the engine.

so let me tell you that a newer comprehensive car policy which you take engine protection is not covered so any damages happening to your engine you want providing you can't claim for that and you won't be providing coverage for that.

so you can opt out for engine protection cover which would do cover any sort of damages to your engine which happens through leakage water damage or physical damage.

so the insurance company would be like liable to compensate you for repair or replacement of your engine.

now it would cost you I use your Mon so it's better to take this add-on cover to protect your engine and this is mostly useful in areas which are more flood prone areas because the water would automatically the water damages the engine and in that case you would be incurring a lot of cost in replacement of your engine.

so in that sort of areas it's more it's more advisable to take this add-on cover then roadside assistance cover so it's a it's very useful add-on cover to take on along with your vehicle insurance policy because it charges you a little higher premium it's not much difference and whereas it provides you a lot mini service.

so let's see a roadside assistance in insurance cover keeps your insurance at your service. so that you can contact you insure it immediately. so anytime in between your travel whenever you face any problem it provides you an assistance.

so anytime you can contact your insurer immediately and he would be and the person would be there to help you out in the case of accident or any emergency situation so it provides roadside services such as repair on the spot.

so any damages happen it would provide the repair on the spot if you need emergency fuel delivery it would be provided the flat tire service the tire may be changed driver disability if your driver goes through disability and you are stuck in between your way.

so the driver that would be covered another person would be driving you up then slip measurement of stairs part and he needed towing to nearest repair center if your car just stuck down and it does not move then topping your car to the nearest repair center and in case your car is taking a lot many time to get serviced it would involve like many hours two four hours.

so in that scenario you would be provided with accommodation and cap service as well so roadside assistance cover provides your lot many things with a little higher premium than your actual car policy.

Consumable cover car insurance.

Let's see the next one then this is consumable cover car insurance usually does not compensate or pay for any cars consumables damaged so any short of damages happening to cars consumables are not paid are not provided coverage in under the normal car insurance policy.

so at the time of claims you are supposed to pay yourself for the replacement of these consumables to avoid this you could opt for consumables covered in motor insurance a consumable cover is an add-on insurance cover that pays for the cost of consumables like nut and bolts.

so what all things are consumables like your nut and bolts engine oil gearbox oil lubricants trees. so all these things who are considered at consumables because it cannot be reused either it exhaust or it need to be replaced.

so nut and bolts after use it need to be replaced after a period of time whereas the engine while gearbox while all these burnt-out after being used so those things which cannot be reused I referred as consumables and two and opting for this add-on cover would provide you to be replaced or refilled in event of any accident to your car.

so opting for this consumable cover would provide you an add-on covered which would compensate for any sort of damage to your consumables.

Now this is return to invoice cover in case of incidents where you lost your car completely due to fire or theft. so maybe it happens that you completely lost the value of your car whether it has been stolen or due to any fire damage.

now the insurance company would pay you only up to the IDB idv is in short declared value which was determined that how much would we paid you after deducting the depreciation amount and all those and all those the parts which are not covered after deducting all those things the insurer declared values what would be paid by the insurance company which is of course much lower than the invoice value of the car.

so invoice value is what you the value at which you would be purchasing the car since you have totally lost your car you may be going to the market and purchasing another car. so the compensation which you are getting is much lower as compared to the purchase value of the car which again you have to pay as the invoice value to get a new car.

Now whether return to invoice protect add-on cover here you would get the invoice value of your car. so you just have to show the receptor and you would be getting the invoice value of the new car which you would be purchasing which would be a replacement to the same model own old car.

so this happens only in case you have totally lost your car and it's not like some sort of small damage to your vehicle.