Highlights

As per the Motor Vehicles and Road Traffic Act,  it is mandatory for every owner of a vehicle plying on public roads, to take an insurance policy, to cover the amount, which the owner becomes legally liable to pay as damages to third parties as a result of accidental death, bodily injury or damage to property. A Certificate of Insurance must be carried in the vehicle as a proof of such insurance.

Two types of covers are available:

1. Liability only policy. This covers third party liability for bodily injury and / or death and property damage
2. Comprehensive policy. This covers loss or damage to the vehicle insured in addition to (1) above.

No- claim discounts are available on renewal of policy, ranging from 20% to 60%, depending upon the type of vehicle and the number of years for which no claim has been made.

Scope

Liability Only policies:

The policy covers the vehicle owner’s legal liability to pay compensation for:

1. Death or bodily injury to a third party person.
2. Damage to third party property.

Package Policy

In addition to the coverage under liability only, this policy covers loss or damage to the insured vehicle and its accessories due to:

1. Fire, explosion, self-ignition or lightning.
2. Burglary, housebreaking or theft.
3. Riot and Strike & Civil Commotion (Add on cover)
4. Malicious Act.
5. Earthquake (Fire and Shock) Damage. (Add on cover)
6. Flood, Typhoon, Hurricane, Storm, Tempest, Inundation, Cyclone and Hailstorm. (Add on cover)
7. Accidental external means.
8. Whilst in transit by road, inland waterway, lift, elevator or air.

A restricted cover is also available covering the risk of Fire and/or Theft, in addition to the compulsory cover granted under “Liability Only Policy”.

The important exclusions under the policies are:

• Wear and tear, breakdowns
• Consequential loss
• Loss when driving with invalid driving license or under the influence of alcohol.
• Loss due to war, civil war, etc.
• Claims arising out of contractual liability.
• Use of vehicle otherwise than in accordance with `limitations as to use ‘ (e.g. private car being used as a taxi)

Who can take the policy?

Any vehicle owner whose vehicle is registered in his/her name with the Licensing Office.