My Insurance Bazaar: What does Motor Insurance plans covers?

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A Motor Insurance Handbook
Take Control
of your ride
Myinsurancebazaar.com
A SALASAR INSURANCE BROKERS INITIATIVE
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COMMON TERMS
THE LAW SAYS THAT EVERY VEHICLE WHETHER A TWO OR
FOUR WHEELER SHOULD HAVE AN INSURANCE POLICY
IDV Insured declared Value The maximum amount
of money that would disbursed to the policy
holder in case the vehicle is written off
NCB No claim bonus The maximum amount of
discount which a policy holder can get in case of
renewal in case no claims being made in the year
preceding
Zero Depreciation A special Add on cover a new
car owner can get to protect against depreciation
shocks. Applicable in case of 1st 3 years of
ownership
Approved Garages Every insurance provider has tie
ups with garages across the country so that
policy holder can get cash less repair facility
for repair
Online Purchase A facility provided by Insurance
brokers like myinsurancebazaar.com where you can
compare and find the right insurance plan to buy.
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What Motor Insurance is

• An Insurance plan which gives protection to a
  vehicle owner against
• Damages to his/her vehicle
• In case as a vehicle owner you need to pay any
  third party liability as determined by law

Driving a motor vehicle without insurance in
public places is a legal offence as per Motor
Vehicles Act 1988
Types of Motor Insurance Cover

• Broadly of two types
• Liability only policy ( This is a statutory
  requirement)
• Package Policy ( This is a combination of
  Liability only policy and Damage to owners
  Vehicle usually called O.D Cover)

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What Motor Insurance covers

• The damages which the OD Section of the policy
  covers
• Fire explosion ,Self Ignition Lightning
• Burglary /Housebreaking / Theft
• Riot Strike
• Earthquake
• Flood ,Storm ,Cyclone ,Hurricane tempest ,
  inundation, hailstorm , frost
• Accidental external means
• Malicious Acts
• Terrorism Acts
• While in transit by Rail /Road or Inland
  waterways ,Lift, Elevator or Air.
• Landslide or Rockslide

What Motor Insurance dont covers

• Below are the cases which are not covered
• Not having a valid driving license
• Under influence of intoxicating liquor/drugs
• Accident taking place beyond geographical limits
• Electrical Mechanical Breakdowns

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Frequently Asked Questions
Q
How Premium of a Motor insurance is determined?

• There are many factors that determine the premium
  that you pay. For own damage cover different
  insurance companies charge different rates. The
  premium depend on the IDV, coverage and the
  deductibles . Lower coverage and lower IDV can
  raise issues during claims

Q
If CNG or LPG is fitted in the vehicle , Is it
important to Inform the same to the Insurance
company?
If a new CNG or LPG is fitted in the vehicle,1st
it need to be informed to the RTA where the
vehicle is registered so that the same can be
included in the RC of the vehicle. All these need
to be informed to the Insurance company also so
that they form a part of the OD and third party
policy. It is necessary that the policy covers
the newly fitted kit so problems done arise
during claims.
Q
Is service tax is applicable and how much is it?
Post calculation of Net Premium , the final
premium is approached by adding Service tax to
it. The service tax rates are applicable as per
concurrent tax guidelines.
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Frequently Asked Questions
Q
What is the period of the policy?
Period of the policy is also know as the term of
the policy. The policy is usually valid for a
period of one year and has to be renewed before
the due date . In case of Motor Insurance grace
period for renewal is not applicable like other
insurance policies.
Q
If a vehicle is registered and used in two
different cities What premium rate is applied?
For the purpose of calculating premium , the
place where the vehicle is registered is reckoned
and not the place where the same is used. Cities
in India are divided into two Zones ,Zone A B .
Zone A mostly include tier cities.
Q
What is No claim bonus ?
NCB is a benefit accrued to an insured for NIL
claims during the previous policy period. As per
current norms , it ranges from 20 to a maximum
of 50 on Own Damage Premium. This is not
applicable in case of Third party damage
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