What is vehicle insurance?
Vehicle insurance, as its name implies, is a type of insurance aimed at protecting against the financial risk of vehicle damage. Also known as auto insurance or motor insurance, it encompasses a range of vehicles, including cars, auto rickshaws, and motorcycles.
How does vehicle insurance work?
Vehicle insurance protects you from damage caused by accidents, third-party claims, traffic collisions, as well as collisions with other vehicles. Weather-related or natural-disaster coverage is sometimes included in vehicle insurance policies. Car insurance, motorcycle insurance, and commercial vehicle insurance are all examples of vehicle insurance that are not for individual use. Auto-rickshaws, ambulances, taxi/cabs, agricultural vehicles, multi-utility vehicles, and other light vehicles are examples of commercial vehicles. It also includes heavier vehicles such as trucks, buses, and other commercial vehicles.
Benefits of vehicle insurance
Theft or robbery of the car or its contents is covered.
Vehicle insurance covers the costs of damage and repairs caused by accidents, crashes, and natural disasters.
It protects third parties, which would otherwise be a difficult process to prove and recover money or face a legal battle. Vehicle insurance policies also cover physical injuries.
It pays out insurance money in the event of the driver’s death.
Different types of vehicle insurance
Various insurance plans cater to different types of losses. For instance, while one automobile insurance policy may cover accidental damage, it might not include theft protection. Similarly, coverage for vehicles and motorcycles can vary significantly. Here are several types of vehicle insurance policies
Third-party insurance
This sort of automobile insurance protects you from any damage or harm caused by someone else. This does not cover injuries or damages incurred by the owner/own driver’s negligence or theft. A third-party vehicle insurance coverage normally has a lower premium than others.
Own damage insurance
This vehicle insurance policy covers losses caused by theft (of the vehicle or parts of the vehicle), natural disasters such as fire and severe weather, as well as man-made issues such as vandalism and rioting. In the event of an accident, it can also cover the costs of repairs or the loss of personal property.
Comprehensive damage insurance
This automobile insurance policy provides financial protection for both third-party and own-damage obligations. This is a comprehensive policy that provides end-to-end coverage and complete protection against numerous types of damage. It also has a higher deductible and premium.
Collision insurance
This sort of vehicle insurance covers damage inflicted by a collision with an immobile object or some other vehicle on the road. It covers damage caused by potholes or vehicle rolling. There is no coverage if the car breaks down or suffers wear and tear damage.
There are various sorts of automobile insurance plans that the insured can take as add-on policies in addition to the major categories of coverage outlined above. Destruction to the glass of rear/side windows and sunroofs is covered by Glass Insurance (under car insurance). Engine Protector Cover is a type of insurance that covers the costs of repairing an engine after it has been flooded or has leaked oil or lubricant. Consumable Cover is a type of insurance that covers consumable items such as washers, air conditioning gas, bearings, engine oil, and fuel filters. Gap insurance policies, often known as depreciation covers, cover the vehicle’s depreciation cost (the difference between the original price and the existing market value) at the time of the claim.