You own a vehicle, but do you own motor insurance? For most drivers, your vehicle is your asset. You may probably have even given her a name! And if your vehicle has met with an accident, you know exactly how you feel. It’s your worst nightmare, you dread it.
Good news is that you can now control the expenses you will have to bear due to the damage or loss of your vehicle. By insuring your car, you can reduce the financial shock that you may get after an accident or theft. We’re not saying it will happen, but motor insurance can help in a big, big way!
The next time you consider buying motor insurance, and you really should, here are the two types of motor insurance policies that you could opt for:
A comprehensive motor insurance policy covers not only your vehicle but also the owner and other third parties. So, in simple terms, it’s a combination of third party motor insurance plus own damage cover. You get covered for damage to your vehicle as well as the damages to the third party. You obviously pay a higher premium than third party motor insurance but you also get more of your risks covered. Apart from the accidental coverage, a comprehensive motor insurance policy also provides financial support for damages caused to your vehicle due to other factors such as terrorism, riots, natural calamities, fire outbreak, theft. Isn’t that great?
Now, if you crash into someone or somebody’s property, this kind of motor insurance will save you from covering the dues to the person or property you crash into. However, this does not cover damages to your vehicle. In the case of a crash, it is likely that your vehicle has been damaged too. The third party motor insurance won’t be able to compensate you for this.
Why Exactly Do You Need Insurance?
Now that we have got the basics right, let’s understand why motor insurance is so important
When you don’t insure your vehicle with the right motor insurance policy, you have to bear the heavy costs of damages and repairs in case of an accident. These costs are much higher than the cost of just getting an insurance policy. Buying a motor insurance policy covers you from a whole lot of expenses and risks. You can ride without the constant fear of mishap, no we aren’t saying you can drive rashly or recklessly, it’s just that you can focus more on the road and less on the fact that you didn’t get motor wheeler insurance.
The worst kind of accident is the one where there is loss of life, or loss of limbs to you. We don’t ever wish it happened, but in the case of a lethal or bodily injury accident, compensation for you up to a specified amount as mentioned in your insurance policy can help to lessen the financial strain on your family members.
Unarguably, driving a vehicle without third-party motor insurance cover is illegal in India, and when you do anything illegal, it will amount to you having to pay a fine. Now here is the funny part, if you get caught even once, the fine can amount to much higher than the cost of premium for a whole year! And what’s scarier is that you can face imprisonment up to three months as per the Motor Vehicle Act.
As per the Motor Vehicles Act, 1988 it is mandatory to have third-party insurance to ply your vehicle on the road.
If you are a cautious driver, and have been lucky enough to not have any claims, then you get a discount for the next premium that you need to pay for the consecutive year. These add up, and discounts on premiums can go up to 50 per cent if you’ve had claimless years. However, if you had a motor insurance policy that lapsed, then the NCB (No Claim Bonus) discounts would remain valid for a 90-day window to renew. You also lose out on this benefit if you are buying a new vehicle. This NCB discount can be transferred even to a new vehicle; it is basically a reward for being a great rider. So you need to buy motor insurance in time so that you don’t lose out on NCB discounts.
Did you know that motor insurance companies also pay for towing charges when you cannot drive your vehicle due to an accident? This is from the site of accident to a repair shop or a safe place. All these minor expenses collectively can burn a bigger hole in your pocket. The maximum limit of towing charges coverage is INR 500.
If this isn’t reason enough for you to buy insurance, then maybe alarming statistics about vehicle accidents may help to caution you about the perils of not having motor insurance. Just do an online search and you will be sure to find numbers that will scare you. The only time you don’t need motor insurance is when you’ve retired your vehicle to the garage for life.
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