FAQ - Motor Insurance

Q.
What are the different types of motor insurance coverage?
Ans

There are 2 types of Motor Insurance Policies available: 

  1. Liability Only Policy: Covers third Party Liability for Bodily Injury and/ or death and Property Damage. Personal Accident Cover for Owner Driver is also included.
  2. Private Car Package Policy: This covers loss/ damage to the vehicle insured (Own Damage) along with Third Party Liability Cover which includes Bodily Injury and/or death and Property Damage, Personal Accident Cover for Owner Driver and Passengers.

Private Car Package Policy:

A Private Car Package Policy is broadly divided into 3 Categories:-

Section 1: Loss/ Damage to the Vehicle Insurance (Own Damage)

The following perils are covered under a comprehensive policy:

  • Accidental damages caused by external means
  • Fire, Explosion, Implosions, Self-ignition, Lightning
  • Natural Calamities: Flood, typhoon, Hurricane, Storm, Tempest, Inundation, Cyclone, Hailstorm, Frost.
  • Whilst in Transit by road, rail, inland waterway, air, lift or elevator.
  • Act of Terrorism
  • Riot and strike, Malicious Damage
  • Burglary, Theft, Housebreaking
  • Earthquakes (Fire & Shock damage)
  • Landslide & Rockslide

Section 2: Third Party Liability

Third Party Liability covers all the damages and injuries caused by your vehicle with you at the deficiency. It pays for the loss and damage caused to a life or property and thus spares you from the huge compensation which you would have been obligated to pay otherwise. In India, this cover is legally mandatory under the Motor Vehicles Act.

Benefits & Features of Third Party Insurance Policy for your Vehicles:

  1. Death or Bodily Injury to a Third Party
  2. Damage to a Third party Property
  3. Accidental Death of the Vehicles Owner or Driver
  4. Permanent Total Disability suffered by the Vehicle Owner or Driver. 

a. Third Party Injury & Property Damage: A third Party liability cover is as per the requirements of the Motor Vehicle Act, 1988. The Insurer will indemnify the insurance against all claims which he may become legally liable to pay to the third Parties for Injury, Death or Property Damage. The insurer shall be reimbursed the legal cost and expenses incurred by such Third parties and recoverable from the insured. In addition, the expenses related to defence cost incurred by the insured are also reimbursed. 

  • Liability for death or injury to third parties- this means that you are insured against death or injury (caused by your vehicle) to pedestrians, occupant of other vehicles, and outsiders other than passengers, for unlimited amounts. Passengers of private vehicles and pillion riders are also deemed covered.
  • Liability to employees connected with operation of the vehicle- this means you are insured against death or injury (caused by your vehicle) to the vehicle's drivers, cleaners, conductors, coolies etc. , employees used in the operation of the vehicle.
  • Liability to passengers carried in the vehicle for hire or reward - this means that as an owner of a taxi, bus or auto - rickshaw, you are insured against death or injury (caused by your vehicle) to the passengers

LIMITS OF LIABILITY FOR THIRD PARTY: 

a)  Under Section II -1 (i)  of the Package policy

 (Under Section 1 (i) of the Liability Only Policy)

As per requirements of Motor Vehicle Act, 1988

b)  Under Section II –1 (ii)  of the Package policy  

(Under Section 1(ii) of the Liability Only Policy)

Rs. 7.5 lakhs

or

Rs.6,000/-, where the proposer / insured opts to limit the TPPD liability to the statutory limit of Rs.6000/-. Endorsement IMT-20 is to be used.

  1. The limit under 5 (b) above is in respect of any one claim or series of claims arising out of one event / occurrence.
  2. If at the insured’s option, the expiring TPPD cover stands limited to the statutory limit  of Rs. 6,000/-, an additional premium of Rs. 100/- is to be charged for changing the TPPD cover to Rs. 7.5 lakhs on renewal.

Section 3: Personal Accident Cover for Owner/ Driver

The company will pay a compensation for bodily injury/ death as mentioned below:-

  1. Personal Accident Cover for Driver/owner which is compulsory in case of cars owned by individuals and where the owner is duly licensed to drive the vehicle.
  2. Personal Accident Cover for occupants
  3. Loss of Accessories.
  4. Cover for paid driver.

PA COVERAGE

  • Personal Accident Owner Driver Compulsory – Rs. 2Lacs
  • Passenger Optional Min: Rs. 50000 Max. upto Rs. 2Lacs
  • Two Wheeler Owner Driver – Compulsory Rs. 1Lac

COVERAGE

  1. Death-------------------------------------- 100% CSI
  2. Loss of 2 limbs --------------------------100% CSI
  3. Loss of 1 limb---------------------------- 50% CSI
  4. Permanent total Disablement ------ 100% CSI

PREMIUM RATES FOR ADDITIONAL COVERS 

  • Owner Driver PA cover private car -----------Rs. 100/-
  • Owner Driver PA cover two wheeler ----------Rs. 50/-
  • PA Cover for passenger – Private Car--------Rs. 5/ per10K
  • Legal liability for paid driver ---------------------Rs. 50/-
  • Liability for employees – Private Car ---------Rs. 50/-
  • Liability for employees Two wheelers --------Rs. 60/-
  • Geographical Area Extension ------------------Rs. 500/-

Motor Insurance Third Party Premium Rates(2015):-

Below given is the applicable premium rates from April 1, 2015, pertaining to the Third Party Motor Insurance:-

Condition Relating to Engine Capacity Applicable Premium Rate
Not exceeding 1000cc Rs.1,468
Above 1000cc but lower than 1500cc Rs.1,598
Exceeding 1500cc Rs.4,931

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