Motor Insurance

For most of us, our car is dearer than a wife. It should be handled carefully!!
Accidents are unfortunately very frequent in our country. With hardly anyone following traffic rules, damages are very common resulting in both – a financial loss and loss of mobility. Although the Indian law makes it compulsory to insure your vehicle against third party liability, prudence also suggests a comprehensive cover for your vehicles

What is motor insurance?
Motor insurance is a contract between a vehicle owner and the insurance company where the insurance company compensates for the loss arising from accidents, burglary, or third party injuries/death. It can also cover any personal injury, to you or to your passengers due to a mishap.

There are 2 types of covers available:
Liability Only cover – insures you against any legal liability following an accident involving your vehicle which is mandatory as per the motor vehicles Act. It does not cover any damage to your vehicle.
The policy covers the following risks only:

Injury or Death of Third Party
Property Damage (TPPD up to Rs. 7.5 Lacs)

Package cover – Insures all liabilities, as per the Motor Vehicles Act, as well as damages caused to your vehicle.
The policy covers Own Damage to the Insured vehicle caused by:-

Accident by External Means Fire, Explosion, Self Ignition and Lightning
Transit by Road, Rail, Inland Waterway, Air, Lift
Burglary, Housebreaking or Theft
Terrorism, Riots, Strikes or Malicious Acts
Earthquake, Flood, Storm, Landslide, Rockslide

Addon Covers available:
Zero Depreciation: In a regular claim, an insured bears 30% – 50% of the cost of Fibre Glass, Rubber, Plastic Parts, Tyres and Batteries Cost. However, with additional coverage of the Zero Depreciation Plan – the Insurance company even bears the depreciation cost and no amount is borne by the Insured. However, generally, there is a restriction on the number of claims as 2 to 3 claims in one year

Consumables: In a claim under the normal motor policy, the cost of Consumable Items such as Screws, Fuel Filter, Air Filter, AC Gas, Engine Oil, Brake Oil, Bearings etc has to be borne by the Insured. There are certain Policies that also do cover these Consumable Items by paying higher Insurance Premium or taking Extra Add Cover for Consumables.

Return to Invoice: In a regular policy, in case of theft or total loss claim, the Insured declared value of the car is paid and not the on-road price. By opting for this cover, Insurance Companies pays an amount equivalent to Ex-showroom Cost + Road Tax + Registration Cost of Car.

Garage Cash/Daily Allowance: in the event of a claim the vehicle is in the garage for being repaired and the insured has to bear the conveyance expense till the time it gets repaired. There are insurance companies which even offer daily allowance i.e Fixed amount (around Rs.500 – Rs. 1000) per day to be paid for the purpose of meeting the cost of hired transport in case of Vehicle meets an accident or stolen.

Engine Protect: The engine is like the heart of the car. The Flood Prone Areas or heavy waterlogging can cause car engines to choke. This phenomenon is known as a hydro-static lock. Since the engine is one of the most crucial parts of a car, repairing it is a costly affair. One can take an Additional Engine Cover while buying New Car which also covers the gearbox too

Loss of Personal Belongings: Insurance Company pays for the loss or damage to Insured or their Family member’s personal belongings. However, it excludes – excludes Money, securities, cheques, bank drafts, credit or debit cards, jewellery, lens, glasses, travel tickets, valuables, manuscripts, paintings and items of similar nature. A Maximum capping amount is there which varies across plans from Rs. 10,000 to Rs. 50,000

NCB Protect: No claim bonus is a reward for those policyholders who have not registered any claims against their car insurance policy in the past. Over a period of time, this bonus can be accumulated to claim a discount of up to 50%. However, even a single claim on your policy can bring this down to 0%. By buying an add-on cover, can be avoided. Under this add-on, even if you have a claim, subject to a certain sum, NCB earned by you remains protected at the current percentage or at a step-down percentage instead of becoming 0% under a normal policy

Key Protect: Insurance companies reimburse for the cost of replacing the insured’s vehicle keys which are Lost or Stolen. The covered cost is limited to the money paid to a locksmith to produce a new key or even the replacement cost of locks if the vehicle is broken into.

Roadside assistance: With Road Side Assistance service you can avail the following benefits:

Flat Tyre Change Arrangement
Battery jump start
Arrangement of a spare key
Breakdown support over the phone
On spot technician for Minor Repairs
Towing of vehicle to the nearest garage on breakdown/accident*
Arrangement of rental vehicle**
Arrangement/supply of fuel**
Accommodation arrangement**
Message relay- Facilitate passing on urgent messages to relatives/colleagues as needed during an emergency
* Free up to first certain kms from breakdown spot. Beyond which chargeable at actual.
** Actual cost to be borne by the insured. The arrangement is free.

Major Exclusions:

Consequential loss, wear and tear, mechanical or electrical breakdown, failures or breakages
Damage to tyres unless the motor vehicle is damaged at the same time when the liability of the insurer is limited to 50% of the cost of replacement;
Any accidental loss or damage suffered whilst the insured or any person driving with the knowledge and consent of the insured is under the influence of intoxicating liquor or drugs.
Cost of part/s and allied labour, failure of which led to an accident.
Any accidents outside the geographical area of India
Driving without a valid license for that class of vehicle
Vehicle not being used as per the regulations of registration
War and nuclear perils

In this age of advertisements, choosing the right car insurance can get quite tricky. The ideal way to making the right choice is to seek advice from your insurance consultant before buying a plan. We at Goodfaith will help you not only to get the best premium available but also add valuable riders and benefits to the plan. You can save a huge sum on car insurance premiums.