Motor Insurance

When you finally buy that vehicle you have been so bug-eyed for the purchase of, you need to keep it with all the care and love in the world. While you should always be a responsible driver/rider, you need to make sure that you carry a safety net against the unforeseen events. Yes, we are talking about motor insurance which protects your vehicle against the unfortunate events, compensating for loss and damage. Let us scroll through it and know everything about vehicle insurance.

Motor Insurance

What is Motor Insurance?

Motor insurance or vehicle insurance offers what any other insurance policy does. But here’s a tweak: It is mandated by law in India. Motor insurance brings coverage for damages/losses suffered by vehicles. These vehicles include cars, jeeps, motorcycles, scooties, buses, trucks, agricultural vehicles etc. 

Types of Motor Insurance

  • Car Insurance: This type of motor insurance offers coverage against any damage/loss (third-party, own-damage or comprehensive ) occurred by cars.
  • Two-Wheeler Insurance: The two-wheeler insurance offers coverage against damage/loss occurred by two-wheelers such as bikes or scooters. It offers third-party, own-damage and comprehensive plans.
  • Commercial Insurance: This insurance covers the damage/loss occurred by vehicles that are used for personal purposes. These vehicles include ambulances, trucks, rickshaws, buses, taxis/cabs etc. 

Types of Motor Vehicle Insurance Policies

Here are different types of motor insurance policy plans that you consider when opting for vehicle insurance

  • Third-Party Cover: It is mandatory in India. This insurance covers only those losses/damages which are suffered by third-party property, person alongside legal repercussions.
  • Own-Damage Cover: This type of plan offers coverage to the losses/damages occurred to one’s own vehicle, coverage for bodily injuries etc.
  • Comprehensive Cover: It is the most preferred plan which includes third-party as well as own damage cover. 

Benefits of Motor Insurance

There are multiple benefits that come wrapped under motor insurance. It offers a great deal of peace and a good night’s sleep where there’s no worries about unbearable expenses resulting from damaged vehicles, medical bills etc. 

Here are the benefits of motor insurance that you cannot ignore:

  • Motor insurance offers you the coverage against accidental damages suffered by your vehicle. Using this, you can avoid the expenses for repair/replacement of vehicle parts.
  • It provides coverage against the accidents that happened out of natural calamities like flood, earthquake, landslides etc. It also covers for the loss born out of fire/explosion or theft.
  • An insured vehicle saves your budget from medical expenses in case of any bodily injuries suffered by vehicle owner/driver.
  • It offers you legal protection in case of third-party involvement, covering lawsuits which include lawyer fees.
  • Motor insurance policies offer protection to survivors in case of any death due to an accident.
  • Since this insurance is mandatory in India, getting your vehicle insured prevents you from violation of traffic laws.
  • If you don’t make a claim during your policy tenure, you become eligible to use no claim bonus.

Motor Insurance: Inclusions and Exclusions

When it comes to spending hours in choosing the right insurance plan and paying the premium one important question that strikes the mind is: What is included in motor insurance and what is not covered in motor insurance? We have listed the inclusions and exclusion in motor insurance policies that you must be aware of. Let’s take a look.

What is Covered in Motor Insurance Policies

  • Third-party liability such as third-party property damage, pedestal damage, medical expenses etc.
  • Legal repercussions
  • Own damage such as damaged vehicle parts, medical bills etc.
  • Damage due to natural causes such as floods, landslides, earthquakes etc.
  • Loss due to theft or fire/explosion.
  • No claim bonus (If you haven’t made any claim during your policy tenure.)

What is Not Covered in Motor Insurance Policies

  • Coverage against the damage that occurred after the policy expiration.
  • Coverage against the accident which took place out of the covered geographical area.
  • Coverage for an accident which took place when the driver was under consumption of alcohol, drugs or any substance.
  • Coverage in case the vehicle was being driven by the person without a valid driving licence.
  • Coverage against loss or damage that occurred out of driver’s negligence.

Note: The inclusions and exclusions  in motor insurance policy vary across different plans. While the third-party plan offers coverage in case of any third-party loss/damage, the comprehensive includes third-party and own damage along with several other covers.

How to File a Motor Insurance Claim?

Wondering where to start? Here is a step-by-step guide for you to understand everything you need to do to claim motor insurance after an accident.

Here is how to claim motor insurance:

  • Contact Your Insurer

When your vehicle ends up meeting an accident, it is best to contact your insurance company and inform them about it. Taking time in doing so can lead to complications in your way to settle the claim.

  • Let the Inspection Begin

As the process carries on, you will be assigned a surveyor by the insurance company. This surveyor will be present at the garage to look into the damaged parts of your vehicle. After that, the surveyor will report the case to the insurer and the repair will begin then.

If you are making a reimbursement claim, then you can take your vehicle to the garage and get it repaired by paying the cost yourself. You can show the original receipts/bills to the insurer. Your insurer will reimburse you the amount, subtracting the deductibles.

  • Submit Documents

You need to be ready with all the required documents to present to your insurer. Make sure you have all the documents as asked by the insurer available or it will result in rejection of your claim. We have mentioned all the documents that are required by insurance companies below.

  • Get the Settlement

Once the inspection on your vehicle is complete and the claim is approved by the surveyor, you will be able to get the settlement amount. 

So there was a simple guide to making a claim for your motor insurance but there is more to it. There are some parameters of making a claim that you must know when contacting your insurer. Let us move to the next crucial step and know more about it.

Documents Required When Making Claim

Here are the documents that are required when making a motor insurance claim:

  • Claim form
  • Copy of valid driving licence
  • Copy of registration certificate of vehicle
  • FIR 
  • Receipts and bills
  • Tax receipt

Top Car Insurance Companies in India with OD Claim Settlement Ratio & Network Garages

Find below the best motor insurance companies in India with claim settlement ratio (CSR) & network garages.

Car Insurance Company OD Claim Settlement Ratio Network Garages
Acko Car Insurance 72.68% 2,000+
Bajaj Allianz Car Insurance 91.23% 4,000+
Bharti AXA Car Insurance 88.49% 5,200+
Chola MS Car Insurance 85.86% 7,100+
Edelweiss Car Insurance 70.59% 1,000+
Future Generali Car Insurance 88.56% 2,500+
Digit Car Insurance 85.76% 1,400+
HDFC ERGO Car Insurance 89.48% 6,800+
ICICI Lombard Car Insurance 87.84% 5,600+
IFFCO Tokio Car Insurance 96.44% 4,300+
Kotak Car Insurance 81.70% 1,300+
Liberty Car Insurance 87.48% 4,300+
Magma HDI Car Insurance 75.66% 4,000+
National Car Insurance 80.50% 3,100+
Navi Car Insurance 53.10% 900+
Reliance Car Insurance 83.81% 3,800+
Royal Sundaram Car Insurance 94.07% 4,600+
SBI Car Insurance 91.74% 16,000+
Shriram Car Insurance 62.84% 2,000+
Tata AIG Car Insurance 91.80% 5,000+
New India Car Insurance 92.23% 3,000+
Oriental Car Insurance 93.16% 3,100+
United India Car Insurance 84.17% 3,100+
Universal Sompo Car Insurance 92.45% 3,500+

(*Claim Settlement Ratio For FY 2018-2019 As Per IBAI’s General Insurance Claim Insights Handbook For Policyholders – 4th Edition)

Things You Must Remember When Making a Motor Insurance Claim

There are some unavoidably important things you must know when making a claim for your motor insurance claim. These points will save you from risking your claim settlement to rejection and unnecessary headache. 

Here is what you need to know before you make a claim for motor insurance:

  • Whenever there is a case in which your car is involved in causing any third party damage or it is lost to theft, the major step you need to take is to head to the nearest police station and lodge an FIR. The copy of this FIR will be required during the documentation process.
  • Be honest while describing the whole incident to the police as well as your insurer. Any discrepancy will lead to the immediate rejection of your claim.
  • You can ask your insurance company for a cashless repair. Many insurers have network garages where the vehicle is taken for repair. You can also take your vehicle to the network garage and get it repaired yourself. Then get the reimbursement settlement from your insurer.
  • Make sure all of your documents asked by the company are in check.
  • Make sure you read the entire policy carefully.
  • Do not be in haste while signing the final papers of settlement. You should go through the papers carefully and consult them with your lawyer.

Takeaway: Motor Insurance

Hope you will make a well-thought decision for vehicle insurance now. You should get your vehicle insured not only because it is compulsory but also because it reduces financial burdens and offers a treat of peace on unforseen events. When deciding the plan, you should consider your requirements and ability to pay a premium. Apart from everything else, you can always pay attention to a cautious driving and avoid anything that threatens it. 

Frequently Asked Questions

What is motor insurance?

Motor insurance is a type of insurance that offers insurance coverage for vehicles against any damage/loss. It includes car insurance, two-wheeler insurance and commercial vehicle insurance

Are accessories covered in motor insurance coverage?

Yes. You can get your vehicle insured to cover the cost of accessories damaged/lost due to an accident. This cover is offered as an additional, the add-on, coverage.

What is a Reimbursement Claim?

A reimbursement claim is when you get your vehicle repaired yourself and make all the payments from your pocket. You show the original receipts/bills of all the repairs or replacements to your insurer after which the amount (minus the deductibles) is reimbursed to you as settlement.