Frequently Asked Questions
1. What is the meaning of insurance?
3. Why should I fill up proposal form for buying Insurance?
5. What is Car Insurance and why it is important?
6. Is Motor Insurance compulsory?
7. What are the different types of Insurance Cover available?
8. Which is a better policy: Comprehensive or third party policy?
9. What is required for car Insurance?
12. When should I report to the police?
13. Why do premiums vary between different insurance companies?
14. What factors determine the premium amount?
15. What does the Legal Liability cover for a paid driver?
16. Can I renew my motor policy online?
18. Will the insurance company pay an advance on the basis of a damage estimate?
19. What are the important vehicle documents?
20. What car insurance doesn’t cover?
22. If you are not having enough money to repair the vehicle! What to do?
23. What to do if the vehicle is stolen?
24. In what conditions / Situations Claim could be rejected / denied by the insurance company?
25. When a vehicle is treated as total loss?
28. Is it necessary to lodge police report in every case of commercial vehicle accident?
31. If a music system or any other item installed in the vehicle is stolen. What steps to be taken?
1. What is the meaning of insurance?
Insurance is a protection against financial loss arising on the happening of an unexpected event. Insurance companies collect premiums to provide for this protection and losses are paid out of the premiums collected from the insuring public.
Underwriting of a risk involves consideration of material facts on the basis of which a decision will be taken whether to accept the risk and if so at what rate of premium.
3. Why should I fill up proposal form for buying Insurance?
Insurance is a contract between the insured and the insurer and the proposal form acts like offer from insured side. Moreover, it contains all the required information for the preparation of the policy which is a contract document.
4. Can I hand over my insurance premium cheque or cash to my agent and is he authorized to issue a receipt?
As per the present provision, the contract of insurance is between insured and the insurer. The role of intermediaries like agent is only for facilitating this process. Thus an Agent can accept premium and cannot issue receipt.
5. What is Car Insurance and why it is important?
Car Insurance is a protection against losses which arise due to legal claims made by a third party in case of an accident caused by you or losses which arise as a result of man made/natural calamity to you, your vehicle and co-passengers.
6. Is Motor Insurance compulsory?
Yes. Under the Motor Vehicles Act, all motor vehicle owners must have third party insurance cover.
7. What are the different types of Insurance Cover available?
There are two types of car insurance: 'Third Party Insurance' and 'Comprehensive Insurance'.
Third party insurance protects a policy holder against losses which arise due to bodily injury/death to a third party or any damage to its property. It is mandatory by law to have third party insurance.
However this insurance doesn't protect you against losses which arise due to bodily injury/death to you, your vehicle and co-passengers. If you want to be compensated for any damages to you, your co-passengers and your vehicle in addition to third party coverage, then purchase comprehensive car insurance.
8. Which is a better policy: Comprehensive or third party policy?
Comprehensive car policy is better as it provides both third party coverage and damages/loss to one's own vehicle, co-passengers or self.
9. What is required for car Insurance?
You must tell your insurer everything that is relevant to your insurance. If you don't, then you risk having your policy getting void or being left out without cover. They need to know all your details,
your driving history, car user, car details and location.
No claim bonus is a special discount given for every claim-free year. As per the schedule of tariff, NCB can be earned in the Own Damage section of Policies covering all classes of vehicles but not on Motor Trade Policies (Road Transit Risks / Road Risks / Internal Risks) and policies that cover only Fire and / or Theft Risks.
A cover note is valid for a period of 60 days from the date of issue of the cover note and the Insurer shall issue the Certificate of Insurance before the cover note expires.
12. When should I report to the police?
Incidents such as "Third Party Property Damage", "Bodily Injury To Self or Third Party" or "Theft" should be reported to the nearest police station, under whose jurisdiction the incident has occurred.
13. Why do premiums vary between different insurance companies?
Insurance companies work with different statistics and use different methods to calculate premiums. Some companies are specialized in certain areas or types and so are prepared to give discounts in those areas. This adds to the complexity as various companies yield varied prices.
14. What factors determine the premium amount?
- Make and Model of the Vehicle
- Year of Manufacture
- Place of Registration
- Current Showroom price of the vehicle
- Whether Client is Individual or Corporate
The principal insurance amount and its subsequent premium also vary according to the price of the vehicle.
15. What does the Legal Liability cover for a paid driver?
Legal liability covers the legal compensation that might have to be paid if a third party files any case against the driver for damage, loss, or fire. The driver is covered for a sum equal to his salary for the
policy period. It also covers accidents and occupational diseases.
16. Can I renew my motor policy online?
Yes, provided it is renewed between the period starting two months before expiry and six days after expiry of the previous policy.
17. What if the accident takes place in a city other than where the motor insurance policy was issued?
It does not matter where the accident takes place, if your motor insurance policy is in effect; you remain insured throughout the country.
18. Will the insurance company pay an advance on the basis of a damage estimate?
This practice varies from company to company. Most companies offer a cashless claim service whereby you don't have to pay for the repairs - the company handles them directly. In case you choose the non-cashless service, you are reimbursed once all the repairs have been completed and the bills have been submitted to the insurance company. In such cases, if you are unable to pay the entire charges, you need to inform the insurance representative and the insurer will make the balance payment.
19. What are the important vehicle documents?
Certificate of Insurance proves that the vehicle owner has valid car insurance. You can claim insurance only if the vehicle is registered to you i.e. you are the owner of the vehicle. The insurer has to be intimated to make the endorsement accordingly. If the certificate is defaced, mutilated, or lost, you can get a duplicate certificate by paying a fee and producing an affidavit stating the need for the duplicate.
Driving License proves that the driver is authorized to drive a particular type of vehicle. Further it is a penal offense to drive without a valid license. If you are just learning to drive, you must have a learner's license.
Certificate of Registration proves that a motor vehicle has been duly registered to you in accordance with the Indian Motor Vehicle Act, 1988. You are required by law to carry the Registration Certificate or an attested copy in your vehicle at all times.
20. What car insurance doesn’t cover?
Car Insurance doesn’t cover consequential loss, depreciation, wears and tears, mechanical and electrical breakdown, war perils, drunken driving or vehicle driven by some one else other than the driver stated in driver's clause. The insurance also does not cover failure or breakage when the vehicle is used outside the geographical area.
Voluntary excess is client's option to opt for bearing a certain amount of loss from every claim. When the vehicle owner opts for this option, insurance companies allows discount on the premium.
22. If you are not having enough money to repair the vehicle! What to do?
The insurance companies have tie ups with dealers of the vehicles for providing cashless facility to the insured after the approval of the insurance company.
23. What to do if the vehicle is stolen?
If a vehicle is stolen, the first step is to lodge the FIR / Police Report and get a copy of police report for lodging the insurance claim with the insurance company.
24. In what conditions / Situations Claim could be rejected / denied by the insurance company?
Claim could be denied by the insurance companies in case the driving license of the driver driving the vehicle at the time of accident is non-genuine / fake.
25. When a vehicle is treated as total loss?
When the repair cost of the vehicle exceeds 75 % of the Insured Declared Value (IDV), it will be constructed as a total loss only.
26. If a vehicle is extensively damaged and the insured does not want to retain and get the vehicle repaired. What could be done?
If the vehicle is extensively / badly damaged and could not come under total loss conditions, the insured can request to the insurance company for the settlement of claim on total loss basis but this is the prerogative of insurance company to settle it on total loss basis or not (This is applicable only in case of private general insurance companies).
27. If the public sector company from where vehicle is insured is not having any office at place of accident?
If the vehicle is insured by the public sector insurance company and the company from where the vehicle is insured is not having any local office at or near the place of accident you could contact any other local public sector company and the spot survey could be arranged by the surveyor deputed by that insurance company.
28. Is it necessary to lodge police report in every case of commercial vehicle accident?
If there is no third party loss / damage it is advisable to contact the local insurance office for arranging spot survey of the accidental vehicle or lodge an FIR / Police Report and if there is third party loss / injury / death, it is necessary to lodge the FIR / Police Report.
29. If a vehicle met with an accident outside the local area / city / state of insurance policy issuance office. Is possible to get the vehicle repaired from the place where the accident has occurred?
Yes, by intimating to the local insurance office, the vehicle could be repaired from that place and all the Bills / Cash memos to be deposited to either policy issuance office or local office in original. (Kindly retain photocopies of Bills / cash memos with you).
30. If a vehicle is stolen and recovered on recovery it is observed that the vehicle is damaged and few item from vehicle such as CNG / LPG Kit / Alternator / Carburetor /Battery etc. are missing. What to do?
If a vehicle is stolen and an FIR is lodged by the insured with the police authorities.
- Later insured got a call from police authorities that the vehicle is recovered.
- When the insured visited police station / other place to get his stolen vehicle back, the first thing the insured has to do is to inspect the vehicle properly before getting vehicle released from authorities.
- Please inspect that weather accessories attached to the vehicle such as Gas Kit / Music System , Battery/ Alternator / Tyres / Extra Tyre / Tool Kit etc are intact or not.
- It any thing is missing or vehicle outer / Inner body is damaged kindly intimate to the police authority.
- Before getting delivery report / FIR from police authorities please make sure that the missing items / damaged items are mentioned in FIR report because the final / delivery / FIR report plays important roles in these types of cases.
31. If a music system or any other item installed in the vehicle is stolen. What steps to be taken?
Immediately lodge the FIR / Police report and after that inform the insurance company regarding the mishap. Don’t touch / replace any item under an authorize person of the company inspect the vehicle and after taking the consent of the insurance company the things should be replaced / repaired.
32. If a vehicle met with an accident in night at an isolated place and you leave the vehicle at the spot of accident. In the morning, when you visit the spot of accident, you found that few items of the vehicles such as Tyre / stereo / battery etc. are stolen. What should be taken?
In this case to lodge a police report / FIR is must. In FIR, complete mishap / accident details along with details of items missing from the vehicle should be mentioned.