Commercial Vehicle Insurance: Buy or Renew Truck, Pick Up Van & Rickshaw Insurance Policy

About Commercial Vehicle Insurance 

Commercial vehicle insurance is a type of insurance that covers the damage, loss, injuries or death occurred to/by any commercial vehicle. This insurance offers coverage to commercial vehicles such as trucks, taxis/cabs, tractors, ambulances and other such vehicles that are used to carry goods and passengers. 

Commercial Vehicle Insurance

Key Features of Commercial Vehicle Insurance

Here are some key features of commercial vehicle insurance policy that you must know about:

  • Commercial vehicle insurance policy is compulsory in India.
  • This insurance covers all the commercial vehicles such as ambulances, tractors, trucks, tractors etc.
  • It provides coverage against the damages incurred by vehicles.
  • It offers coverage for medical expenses.
  • It covers the third-party financial liability.
  • It provides compensation to the family members of the insured in case of death. 

Why is Commercial Vehicle Insurance Important?

Because it saves you from unwanted expenses. Yes, the answer is that simple. When you are paying an insurance premium for your commercial vehicle, you are reducing the expenses which you might have to pay to cover the damages suffered by your car, any injuries, or third-party financial liability. 

Here are the important benefits of commercial vehicle insurance policy:

  • It is mandatory in India and thus, buying this policy saves you from legal penalties and cancellation of your driving licence.
  • It covers the personal damage suffered by you in case of natural or man-made disasters, theft and fire or explosion.
  • It covers the expenses billed by the repairs of your vehicle.
  • It covers the medical expenses in case of bodily injuries.
  • It compensates the family of the driver/owner in case of death.
  • It covers legal liabilities.
  • It offers coverage to third-party in case of property damage or bodily injuries.

Types of Commercial Vehicle Insurance 

While ruminating which motor insurance plan appears to be more suitable to fit your requirements and budget, you should know that you have two different options which you can choose one among to buy. There are two types of commercial vehicle insurance that you should know about. These policies offer different coverage that may or may not fit your expectations. 

Here are two types of commercial vehicle insurance policy:

1. Third-Party Liability Commercial Vehicle Insurance

Third-party commercial vehicle insurance covers the damages or injuries suffered by third-party property or person. Beside it is mandatory to have your vehicle insured with a third-party insurance policy in India. This type of vehicle insurance provides coverage against any losses to third-party which includes:

  • Damages to property
  • Bodily injuries to third-party driver/pedestal
  • Legal repercussions
  • Death

2. Comprehensive Commercial Vehicle Insurance

This type of insurance is a big-fat vehicle insurance plan that offers an all-in-one kind of coverage to the insured vehicle. It is the most preferred vehicle insurance plan in India, given that it offers all the important coverages in one policy. It includes:

  • Personal Damage Cover 
  • Theft/Fire or explosion
  • Natural Disaster
  • Coverage for bodily injuries
  • Third-party property damage
  • Third-party person injuries 
  • Death cover (Personal and third-party)

Commercial Vehicle Insurance: Add-on Covers 

An add-on is a cherry to your commercial vehicle insurance cake. You figured that. They exist to adorn your overall insurance plan and expand the scope of coverage benefits at the time of claim settlement. Add-on covers are additional plans that provide coverage to a specific part/service for your vehicle. You can make an additional payment and get your vehicle insured with an add-on. 

Here are some popular add-ons that you can consider at the time of buying a commercial vehicle insurance policy:

  • No claim bonus: No claim bonus is offered at the time of policy renewal only if you haven’t made any claim during the policy tenure. It includes certain offers and discounts. If you opt for this cover, you will be able to use NCB even if you have claimed insurance in your last policy. 
  • Zero depreciation: Since your vehicle undergoes depreciation every year, the difference between its purchase value and the depreciated value becomes deductible by the insurer. This may lead to more expenses from your side. However, if you have a zero depreciation add-on cover, the insurer will not consider the depreciated value then.
  • Return to invoice: This add-on cover nullifies the difference between the invoice value and the declared insured value of your vehicle. If you have lost your car to an irreparable damage or theft then you can make a full recovery claim for that using this cover. 
  • Roadside assistance: The roadside assistance add-on cover offers services at the time of emergency. If you have this add-on, you can make a phone call and ask for services like towing, medical help, fuel arrangement etc. 
  • Consumables: The commercial vehicle insurance policy might not cover small parts such as screws, bolts, brake fluid etc, and thus, you can use the consumables add-on cover in order to have coverage for such parts. This type of add-on is used for high-end vehicles and is usually not applicable on older vehicles.

Also know: Why Vehicle Insurance is Important?

Commercial Vehicle Insurance Claim Process

Now comes the time when you want to claim your vehicle insurance plan. Know that there are two ways to get your claim settled:

  • Cashless Claim: Your insurer arranges the cashless facility for repair and medical repair.
  • Reimbursement: You pay the repair and medical bills and the insurer reimburses the amount to you based on original receipts/bills.

How to claim commercial vehicle insurance? Well, there are some super important actions that you need to take to claim the insurance of a commercial vehicle failing which you may get your policy dumped. 

Here are the steps which you need to follow in order to make it to a successful claim settlement:

  • Contact Your Insurer

Do not wait and contact your insurer the first thing after coming back to your senses after the accident. Know that it is the topmost step you need to take and failing it you invite a risk of losing the policy. You should contact your insurer within 24-48 hours of the accident and make sure you inform them about everything without hiding the facts.

Note: If it is a case of accident in which any third-party person, property damage, death or theft is involved then it is mandatory for you to lodge an FIR at the nearest police station. Make sure you remain honest while sharing the information and share the required details. This document will be required by your insurer.

  • Let the Inspection be Done

Once you have raised a claim, you will be assigned a surveyor by the insurer to confirm every damage suffered by the vehicle and driver. The surveyor will monitor and make note of every damage in order to have the report delivered to the insurance company. 

  • Follow the Documentation

You need to submit all the documents which the insurer demands from you to carry out the procedure without any barriers and unwanted hassle. On missing any of the required documents, you invite the risk of getting your claim delayed or revoked. This consequence can occur in front of your claim settlement if you submit the invalid documents.

  • Get Your Claim Settled

Once you have made it through the claim process and it is approved by your insurer, you will finally have your commercial vehicle insurance claim settled.

Also Know: Things to know before buying Vehicle Insurance

Document Required to Claim Commercial Vehicle Insurance 

Here are the important documents which you need to submit in order to get a quick claim settlement:

In case of accident:

  • Duly signed claim form with all the necessary information filled in
  • Copy of registration certificate of the vehicle 
  • Receipt of tax
  • Copy of insurance policy
  • Driving license of the driver who drove the vehicle at the time of accident
  • Valid fitness certificate
  • FIR if it is a case of any third party injury, death or property damage
  • Repair bills
  • Payment receipts

In case of theft:

  • Receipt of tax
  • Policy number
  • Copy of policy document
  • Registration copy with theft endorsement from RTO
  • FIR
  • Warranty card/service brochure
  • Previous insurance details

If you ever step out to claim your vehicle insurance and expect a hassle-free procedure then you must ensure that each document that is required by your insurer is on check. This will save you from manifolds of rounds to the same spot and get your claim at a quicker pace.

Factors that Determine Commercial Vehicle Insurance Price

Wondering how the commercial vehicle insurance premium is calculated? While you are deciding on a commercial vehicle policy plan you want to buy, you should understand certain factors on which the rates of your insurance premium depend.

Here are the factors that determine commercial vehicle insurance premium rates:

  • Type & use of your vehicle: The type and purpose of your commercial vehicle can affect the premium rates of insurance. For instance, commercial vehicles like tractors, trucks that weigh more are more prone to danger.
  • Age of your vehicle: Age is an important factor when it comes to deciding the vehicle insurance premium rates. The older your vehicle is, the higher the depreciation will be. 
  • Location: Location where your vehicle will most likely be used affects the motor insurance premium rates. The premium rates for commercial vehicles that drive though city rush will be different than the commercial vehicles that drive around the countryside.
  • Credit score: Another important factor that determines the commercial vehicle premium rates is your credit score. Credit aspects such as payment history, outstanding debts, bankruptcy etc. help insurers gauge the premium rate of vehicle insurance. If you make payments on time then you are likely to have low premium rates.

FAQs on Commercial Vehicle Insurance 

1. What is Comprehensive Insurance?

The comprehensive insurance plan is a type of insurance coverage that offers cover for own damages and third-party financial liability.

2. What are three main types of vehicle insurance?

Motor insurance offers three types of policies for different vehicles- Car insurance, two-wheeler insurance and commercial vehicle insurance. 

3. How does the vehicle insurance premium get affected?

The premium rates of commercial vehicle insurance depends on the location, type and use vehicle, age of your vehicle and the credit score.