Auto Insurance in India and It’s Types.
Auto Insurance in India: In India, auto insurance basically deals with the policy purchased by vehicle owners. The insurance covers for the damage or loss caused to the automobile or its different parts due to an accident or natural calamity.
Not only does auto insurance provide an accidental cover for the vehicle’s owner but also for the passengers and third party legal liability.
Different Types of Auto Insurance in India:
- Private Car Insurance: As private car insurance is mandated for all the newly–purchased cars, it is one of the fastest growing sectors in India. The premium amount depends on the value and makes of the car, the year of manufacture, and the state for which the car is registered.
- Two Wheeler Insurance: This type of insurance generally covers accidental insurance for the drivers of the two–wheeler vehicle. The premium amount depends on the present-day showroom price multiplied by the rate of depreciation fixed by the TAC (Tariff Advisory Committee) at the start of the policy period.
- Commercial Vehicle Insurance: Commercial vehicle insurance provides accidental covers for those vehicles, which are used for commercial purposes and not for personal purposes. These vehicles include HMVs, trucks, three-wheelers and auto rickshaws, school buses, delivery vans etc. The premium amount depends on the showroom price of the vehicle at the beginning of the insurance period, make and the state for which the vehicle is registered.
Understanding Auto Insurance in India
Auto insurance in India is one of the mandatory requirements for all the newly-purchased vehicles used for both personal as well as commercial purpose. The auto insurance companies usually have tie-ups with the automobile companies. They offer instant auto insurance quotes to their customers. The customers need to pay annual premiums (the amount that the policyholders pay annually) to the auto insurance companies. In return, the insurance company pays most of the costs in case the vehicle meets with an accident.
Auto insurance premiums vary depending on gender, age, the period of driving experience, moving violation and accident history, and several other factors. Auto insurance claims can be accidental, pertaining to theft, or third party claims. A policyholder needs to have certain documents to claim the insurance. These documents include duly filled and signed claim form, FIR copy, RC copy of the vehicle, a copy of driving license, and the original estimate and policy copy. Moreover, if you want your vehicle to be repaired in a garage, you can also apply for claim reimbursement with the concerned insurance company.
Most of the states in India have made it mandatory for the owners to purchase a minimum amount of auto insurance. But there are many customers who prefer additional insurance covers for further protection. Customers who opt for complete coverage against a policy need to pay higher premiums. However, these premiums can be reduced if a customer agrees to take more risk by opting cheap auto insurance policies. This also means increasing the deductible (amount of money a customer pays for expense before the start of the insurance plan).
The third party insurance policy is the basic policy, which covers only the damage caused by the vehicle to the third party. The comprehensive car insurance gives the customers a complete coverage. Whereas, the generic insurance policy covers damage to vehicle, theft, and loss of the vehicle, and also the third party cover.
What Does Auto Insurance Cover? | Auto Insurance in India
- Burglary, theft or housebreaking, loss and accidental damage, damage due to lightning, fire, external explosion, self-ignition, malicious acts
- Liability for the third party property, injury/death and liability to the designated driver
- Covers for loss/damage of electronic accessories on payment of additional premium
What is Not Covered? | Auto Insurance in India
- Consequential loss, depreciation
- Mechanical and electrical breakdown
- Failure or breakage
- Damage caused by the driver without having a driving license
- Damage caused by the person driving under the influence of drugs, alcohol or other intoxicating substance
- When the vehicle is out of the geographical area
Thus, choose auto insurance wisely to keep yourself protected.