What is motor insurance ? Types of motor insurance | Accidental covers in motor insurance

What is Motor Insurance 

• Motor insurance also known as vehicle / car / auto insurance. 
• It is the insurance purchased for cars, trucks, and other road vehicles.
• It's primary objective is to provide protection against physical damage resulting from traffic collisions and against liability that could arrive their from. 
• Motor insurance in india covers loss of damage cost the automobile or its parts due to natural and man made calemeties.
• It provides accident cover for individual owner of the vehicle while driving & also for co passenger and third party liability.

Types of Motor Insurance:

Their are two types of motor insurance

1. Third party liability insurance (TP Liability Insurance):

 

• TP liability insurance is compulsory on purchase of new vehicles whether acquired for private or commercial usage.
• As per motor vehicle act of india one can be penalised for driving without valid TP cover.
• An accident can happen to anyone even if the driver of the vehicle is not at fault.
• This may result into lot of damages cost in person as well as to the vehicle.
• Motor insurance turns to be beneficial in these circumstances.
• If the driver is liable for an accident, which results in bodily injuries to a third party then the expenses have to be borne by the owner of the car.
• In such case a TP motor insurance saves from a devastating below
• Vehicles are an expensive investment for an individual, 
• An accident can convert this investment into a huge financial loss.
• Hence it is important to have motor insurance to cover damages other than accidents like fire, theft etc.

Third party premium:

It is given by IRDAI (Insurance regulatory & developement authority of india)

It is given once in a year 

Third party premium is basis the below party

• vehicle age 
• cubic capacity
• type of vehicle 
• passenger carrying capacity

Accidental covers in motor insurance (Riders in motor insurance):

1. Personal Accident cover

2. Accidental death benefit coverage ( ADB )

   

      In case their is accident and death and disability happen on account of that accident only on that case ADB rider sum insured is payable.

3. ADDB ( Accidental death dismemberment benefit )

      In this rider depending on the percentage of disability ( partial or total disabiity ). A % of sum assured needs to be paid to the policy holder.

4. Accidental total permanent disability rider

Types of business in general insurance:

1. New Business:

When customer comes first time in insurance company then insurance done for the first time for a risk by the insurance company is called new business.

In new business ideally the vehicle age should be less than or equal to a year.

Note: Vehicle age is calculated as todays date - the date of registration or the date of commencement of policy whichever is earlier.

2. Renewal Business:

When you going to renew the policy on expiry of policy with the same insurance company then it is called renewal business. 

Previous policy no. is used for renewal.

3. Rollover Business:

Rollover is the retaking policy from different company.

When a policy holder shift his insurance premium from one insurance company to another on expiry of a policy then it is called rollover business.

Documents required for testing rollover:

1. Previous insurance policy no.
2. Policies start date and end date.
3. policy tenure
4. previous insurers name
5. previous insurers branch details 
6. previous claims experience.