A Basic Understanding of the Ins & Outs of Motor Insurance

Motor insurance provides financial protection for vehicles against damage and liabilities. It has three main types - Third-Party, Own Damage, and Comprehensive Insurance. Third-Party Insurance is mandatory in India. It covers legal liabilities for injuries or property damage to others. On the other hand, Own Damage Insurance covers the insured vehicle. Finally, Comprehensive Insurance combines both coverages. The Insured Declared Value (IDV) determines the maximum coverage for a vehicle based on its market value. Factors like age, make, model, and location influence the IDV. Premiums for third-party insurance are set by the Insurance Regulatory and Development Authority of India (IRDAI) based on engine capacity.

In addition to third-party coverage, personal accident cover is also mandatory. Plus, there are optional add-on covers that could enhance the coverage. These include options like Zero Depreciation and Engine Protection. You can apply for motor insurance offline through agents or dealerships. There are also online options that offer convenience and comparison between policies. Understanding motor insurance could help you ensure that your vehicle gets the required financial protection against damage or loss. It is wise to explore various options and understand what influences insurance coverage and premiums.

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Key Takeaways

Motor insurance offers financial protection to a vehicle in case of accidents, theft, and third-party liabilities

The Insured Declared Value (IDV) determines the maximum payout and is based on the vehicle’s market value

Third-party insurance is mandatory by law and financially covers damage or injury caused to others

Own damage insurance financially protects your vehicle against damage from accidents, theft, or natural calamities

Comprehensive insurance provides a combined cover for both third-party and own damage protection

IRDAI regulates third-party premiums based on engine capacity, with specific rates for different vehicle types

Applying for motor insurance online offers more options, easier comparisons, and faster processing

Frequently Asked Questions
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Motor insurance is a financial protection plan for vehicles, covering damage and liabilities. It's important because it provides financial security in case of accidents, theft, or natural calamities. It also helps vehicle owners comply with legal requirements, as third-party insurance is mandatory in India. Motor insurance ensures that both the vehicle owner and potential third-party victims are protected financially in case of unforeseen events.
You can choose from three main types of motor insurance. These are Third-Party Insurance, Own Damage Insurance, and Comprehensive Insurance. Third-Party Insurance is mandatory and covers liabilities to third parties. Own Damage Insurance covers damage to the insured vehicle. Comprehensive Insurance combines the benefits of both, providing the most extensive protection. Each type offers different levels of coverage to suit various needs and budgets.
Motor insurance premiums are calculated based on several factors. For third-party insurance, premiums are set by IRDAI and depend on the vehicle's engine capacity. For other policies, factors like the vehicle's Insured Declared Value (IDV), age, make, model, and location are considered. The IDV, which represents the maximum sum insured, plays a significant role in determining the premium. Higher IDV generally results in higher premiums.
Applying for motor insurance online involves visiting a website, providing your vehicle details, and comparing quotes. After selecting a suitable policy, you provide your personal information and upload required documents. The final steps include reviewing all details and paying the premium online. This process offers convenience, allows easy comparison of different policies. It might also help you to get coverage for your vehicle quickly.
In addition to basic coverage, motor insurance policies offer various optional coverages. For example, Zero Depreciation cover ensures full claim amount without depreciation deductions. Similarly, the Engine Protection add-on safeguards against engine damage. Personal accident cover is mandatory and provides protection up to ₹15 Lakhs. Other options may include Return to Invoice cover and accessories cover. These additional protections offer enhanced policy coverage.
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