Knowledge Centre

Importance of Having a Valid Motor Insurance

More and more people prefer to travel in their own vehicle due to the comfort and safety reasons, however driving on the road comes with its own share of risks and responsibilities. We need to realize that driving with a valid motor insurance is not only a measure taken for our own safety, but it is also a legal requirement as stated under Motor Vehicles Act 1988 and also under the recently passed Motor Vehicle Amendment Act 2019.

Let’s take a look into the importance of having a valid motor insurance

Legal Requirement of Having Valid Motor Insurance

We all need to be a law abiding drivers, driving without a valid motor insurance is an offence under both Motor Vehicles Act 1988 and also under the recently passed Motor Vehicle Amendment Act 2019.

Let us take a look on the types of motor insurance policy available in the market.

Third-Party or Liability only policy

Third Party Insurance is an insurance policy which provides you insurance coverage against liability arising from any kind of property damage, bodily injury or death of the third party in an accident. Third-Party policy can be bought and accessed easily online, renewal of the same can also be done online by following the required procedure.

For brand new private cars and two wheelers, effective 1st Sept, 2018 a long term third party policy for 3 years (private cars) & 5 years (two wheelers) is mandatory. For rest of the motor vehicles, only annual policy is available.

Comprehensive Insurance Policy

A comprehensive insurance plan provides coverage for the damages to your vehicle, any kind of property damage, bodily injury or death of the third party and also the personal accident coverage. A comprehensive insurance plan safeguards your vehicle against damages to your vehicle from vandalism, theft, , Fire, flood, natural calamities like a windstorm, hail storm, hurricane, earthquakes etc. A comprehensive insurance plan is costlier than a third party plan but the cost factor diminishes when you take into account the variety of risks that get covered under it.

Standalone Own Damage Insurance policy.

Another type of insurance policy which you can buy to safeguard your vehicle is Standalone Own Damage insurance policy. This plan will provide protection to your vehicle against theft, fire, flood, earthquake etc and is similar to the own damage cover available under comprehensive insurance policy.

All good things comes with a caveat so you will have to have a mandatory Third Party or Liability only insurance policy for thedesired policy duration failing which you cannot buy this insurance policy. Further, this policy can be offered only to Private car and Two wheeler and not to other types of motor vehicles.

This insurance policy was introduced on 1st Sept, 2019 in the market by IRDAI.

Benefits of Add on Covers

Why go for a basic motor insurance plan when you have top up covers to enhance your coverage? Your motor insurance plan is a boon when topped up with add on covers like Zero Depreciation, Emergency Assistance, Key Replacement, Return to Invoice, Engine & Gear Box Protector, Cost of Consumable Items and Loss of Use - Downtime Protection. You read more about add on covers and their benefits by clicking here

The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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