[arundeepbv]

Hello, TeamBHPians! I've been scouring the forum for a dedicated thread on insurance but couldn't find one. So, I thought it would be beneficial to start a thread focusing on the different types of insurance available, potential add-ons, their limitations, and the claim process for those unfortunate incidents. After all, knowing how to navigate the claim process can make a potentially stressful situation much easier to handle. Let's get the conversation rolling!

Insurance is a topic that often takes the backseat but is essential for every vehicle owner—vehicle insurance in India. While we all love talking about horsepower, torque, and the latest gadgets, understanding insurance policies can save us from a lot of headaches in the long run. So, let's jump right in!

The Types of Vehicle Insurance Available

Third-Party Liability Insurance

The most basic and legally mandated insurance in India, Third-Party Liability Insurance covers you against damages to another vehicle, property, or individual. However, it doesn't cover any damage to your vehicle.

Comprehensive Insurance

This package gives you broader coverage. It includes third-party liability and also covers damages to your vehicle caused by natural calamities, theft, fire, etc.

Add-ons and Special Policies

From Collision Coverage to Zero Depreciation and Engine Cover, there are various add-ons to make your policy more comprehensive. There are also specialized packages like Pay-as-You-Drive and Commercial Vehicle Insurance, catering to specific needs.

Understanding Liability Caps

Third-Party Liability

For bodily injuries or death in a third-party accident, there's no maximum limit for the payout. However, there is a cap for third-party property damage, often around 7.5 lakh INR.

What Happens When Damages Exceed the Cap?

If you're involved in an accident where the property damage exceeds your policy's cap, you're liable for the remaining amount. The property owner can even take legal action to recover this amount. Therefore, it's critical to understand the limitations of your policy.

Pro Tips for Extra Coverage

Some folks opt for additional "Umbrella Policies" or "Excess Liability Insurance" to safeguard against costs exceeding regular policy limits. While these are less common in India, they can provide an extra layer of protection.

The process of claiming insurance can vary depending on the insurance provider, the nature of the claim, and whether it's a third-party or comprehensive claim. Below is a general guideline on how each type is typically claimed.

Third-Party Insurance Claim:

1. Report the Incident: The first step is to report the incident to the police and file an FIR (First Information Report).

2. Inform the Insurance Provider: Notify your insurance company as soon as possible, providing details of the incident and the FIR.

3. Collect Information: Gather information from the third party involved such as their name, contact information, and insurance details. Witnesses can also be helpful.

4. Submit Documentation: Provide all necessary documents, such as the FIR, your policy details, and any other required forms, to the insurance company.

5. Legal Process: In case of significant damages or injuries, the case might go to court. The insurance company will represent you.

6. Claim Settlement: Once all formalities are complete and the claim is approved, the insurance company will settle the third-party's claims.

Comprehensive Insurance Claim:

1. Assess Damages: Before anything else, assess the damages to your vehicle. If it's a minor issue, you might choose not to claim insurance at all.

2. Contact Insurance Provider: Notify your insurance company of the incident. Many insurers have a 24/7 hotline for this purpose.

3. File an FIR: In case of theft or significant damage, you might need to file an FIR.

4. Documentation: Collect all necessary documents, such as photographs of the damage, repair bills, and submit them to the insurance company.

5. Survey and Verification: A surveyor from the insurance company may inspect the damages to the vehicle and verify your claims.

6. Claim Approval and Settlement: After successful verification, the claim is approved and the insurance company will cover the repair costs minus any deductions.

7. Reimbursement: If you’ve already paid for the repairs, submit the bills for reimbursement.

Knowing how to navigate the claim process can make a potentially stressful situation easier to handle. Whether you have third-party or comprehensive insurance, it's essential to be familiar with your policy's terms and conditions for a smooth claim process.

While vehicle insurance might not be the most exciting topic for automobile enthusiasts, it's an essential aspect of responsible vehicle ownership. Understanding your options and limitations can save you a lot of trouble down the line. Make sure you read through your policy details carefully and consider add-ons that might be relevant to you.


Thank you for taking the time to read through this cthread on vehicle insurance in India. I have covered various aspects, from types of insurance and their limitations to the nitty-gritty of claim procedures. But, of course, this is a vast and ever-evolving subject, and I wholeheartedly welcome any additional information or perspectives that you, my fellow TeamBHPians, may have.

I know that dealing with insurance can be daunting and confusing, but it's a part of the driving experience that we shouldn't overlook. So, please feel free to ask any insurance-related questions you may have right here on this thread. Your questions will not only benefit you but also contribute to our community's collective wisdom.

I'll do my best to find the answers and share them here for everyone's benefit. Together, we can make this thread a go-to resource for any automobile enthusiast looking to understand the intricacies of vehicle insurance.

Let's help each other become more informed and prepared for those unexpected turns on the road of life. I'm excited to hear your thoughts, questions, and experiences. Let's keep this conversation rolling!

[Kkumar]

Thank you for such a wonderful write up on vehicle insurance. This is one of the most important aspect of vehicle ownership which majority of the vehicle owners overlook as it’s cumbersome to go through the terms and conditions and understand the nitty gritty of legal terminologies.

[SPB_drives]

Thank you for such a detailed post on this relevant topic. A recent unfortunate incident with my car has helped me understand the sensitivity of the covers taken in an insurance policy. Please can you also help us understand whether engine cover protection add-on should be taken in addition to zero depreciation.

Also, I had a terrible experience with Liberty Insurance wherein they have handled my case very shoddily and have rejected certain items from the claims without explanation. Request the members to choose Liberty Insurance at their own risk.

[Ashdel]

Thanks for this thread - couple of addons

1. You can choose your own IDV - provided that the insurance company agrees to insure with that amount. In case of unforeseen "Total Loss" insurance company cannot come back and say - you car is over insured basis market value (I personally went through this 10 years back - where my Santro was stolen and i normally choose highest IDV - next steps in point 2)

2. In case of any dispute between the insured and company - send written communications to their customer care - still if no solution is provided within 30 days or you are unhappy with the outcome - file a case with Insurance Ombudsman - they have centers all over India - (This is what i did after my Santro theft claim was denied - fought on my own and won the case - you would not need a lawyer for this - this Insurance court is consumer friendly and they are for all types of insurance matters - not limited to Motor).

[SinghBHP]

Always take Gap Value / Return to Invoice Coverage while taking the insurance.

You would notice that when we buy a car the Sales guy may provide you insurance on ON_ROAD price which does not cover the additional taxes you pay on your car. In case of a theft the claim is processed on the ON_ROAD price and you lose hefty amount which you paid as taxes. The Return To Invoice or Gap Value insurance covers that and you get the claim value as per total amount at the time of purchase.

[arundeepbv]

Originally Posted by SPB_drives

Thank you for such a detailed post on this relevant topic. A recent unfortunate incident with my car has helped me understand the sensitivity of the covers taken in an insurance policy. Please can you also help us understand whether engine cover protection add-on should be taken in addition to zero depreciation.

Understanding add-ons to comprehensive insurance can help you make more informed decisions about your vehicle's coverage.

Engine Cover Protection
This add-on covers the cost of repairs or replacement of the engine and its components in case they are damaged due to flooding, leakage of lubricating oil, or any other unforeseen event. It's particularly useful if you live in an area prone to flooding or if your car's engine is susceptible to issues not covered under a standard comprehensive policy. Engine cover protection can be invaluable in situations where your car's engine faces damages not related to a typical accident. For eg during heavy rainfall your car is flooded when parked at home. Although the car was not involved in a traditional "accident," water has entered the engine compartment. Under a standard comprehensive policy, engine damages due to water ingress are often not covered unless they are directly related to an accident. In this case, you would have to bear the costs of engine repair or replacement yourself, which can be incredibly expensive.


Zero Depreciation
Also known as "bumper-to-bumper" cover, zero depreciation ensures that in case of a claim, you receive the full cost of parts replacement without any deduction for depreciation. Normally, insurance companies factor in depreciation when settling claims, meaning you would have to pay a part of the repair costs from your own pocket.


Should You Take Both?

1. Overlap: There is minimal overlap between these two add-ons. Zero depreciation focuses on ensuring you get the full value of parts without accounting for depreciation, while engine cover is specifically aimed at protecting against engine-related damages that may not be covered otherwise.
2. Cost Factor: Both add-ons will increase the premium. Consider your risk factors, such as geography (for floods) and how new your car is (newer cars might benefit more from zero depreciation).
3. Comprehensive Protection: Having both add-ons will provide you a broader range of coverage, ensuring minimal out-of-pocket expenses during claims.
4. Vehicle Use: If you use your vehicle extensively, both add-ons make sense as they minimize your financial exposure.
5. Peace of Mind: Lastly, having both add-ons can give you peace of mind, knowing you have extensive coverage.

In summary, while having both add-ons will increase your premium, it offers a more comprehensive coverage that could save you significant money and hassle in the long run. Therefore, if you can afford both, and especially if your vehicle is new or you're in an area with specific risks like flooding, it may be advisable to opt for both engine cover and zero depreciation.

[Altocumulus]

A Major point to consider.

While everyone goes for Zero Depreciation for peace of mind, most insurers have restrictions in fine print on the number of 0Dep claims in a year, in most cases 1 or 2 claims max.

So please ensure you read the fine print, and either go for one with unlimited claims or plan your claims accordingly.

[arundeepbv]

Insurance settlements can take various forms depending on the type of insurance and the specific circumstances of the claim. The objective is to financially restore the insured or the third party to the condition they were in before the incident that led to the claim, within the limitations of the policy. When it comes to settling insurance claims for vehicles, there are generally several types of settlements. Some of them are listed below:

Repair or Replacement
This is the most straightforward type of claim where the insurance company pays for the repair of damages to your vehicle. In some cases, if repair is not feasible, they might pay for the replacement of a part.
Example: You hit a pothole and damages your car's front suspension. your insurance company authorizes a repair at a network garage. You pay the deductible, and the insurance company covers the rest of the repair cost.

Cash Settlement
Instead of repairing the car, the insurance company may offer you a cash amount equivalent to the cost of repairs or the current market value of the vehicle. This might happen if you prefer to repair the car at a workshop of your choosing that may not be within the insurance company’s network.
Example: Your car is damaged in a minor collision. You prefer to get the car repaired at a specialized workshop not affiliated with his insurance provider. The insurer calculates the estimated repair cost and offers you a cash settlement, which you accepts.

Constructive Total Loss
In this case, while the vehicle may not be completely damaged, the cost of repairs exceeds a certain percentage (often around 75%) of the insured declared value (IDV) of the car. The insurance company might then offer a settlement based on the IDV rather than paying for repairs.
Example: You are involved a severe accident. Although your car isn't entirely destroyed, the cost to repair it is 80% of its insured declared value (IDV). Your insurance company decides it's a constructive total loss and offers you a payout based on the IDV.

Actual Total Loss
This is when the vehicle is so badly damaged that it cannot be repaired safely or economically. In this scenario, you will typically receive a payout based on the insured declared value (IDV) of the car, depending on your policy terms.
Example: Your car is caught in a flood, and the water level reaches above the dashboard. The electronic systems are entirely shorted, and the engine is severely damaged. The insurer deems the car as an actual total loss and provides a settlement based on the IDV.

Stolen Vehicle
If your vehicle is stolen and not recovered within a certain period, it's usually considered a total loss, and you're entitled to a payout based on the insured declared value (IDV).
Example: Your car is stolen from a parking lot and is not recovered despite police efforts. After waiting for the obligatory period (as mentioned in the policy), you file a claim and receives a payout based on the car's IDV.

Third-Party Settlement
In the case of third-party insurance, the insurance company will settle any claims made by a third party against you for property damage, injuries, or death caused in an accident. The claim amount can vary depending on the court's judgment if it gets to that point.
Example: You unintentionally collides with another vehicle at an intersection, causing damage to the other car and injuring its driver. The third-party files a claim against your third-party liability insurance. After evaluation, the insurance company settles the claim by paying for the other party’s vehicle repairs and medical expenses.

Deductibles
In almost all types of settlements, you'll need to consider the deductible. This is the amount you'll need to pay out-of-pocket before the insurance company’s coverage kicks in.
Example: You have a minor accident that causes a dent in your car’s door. The total repair cost is Rs1,000. She has a deductible of Rs200. You pay the 200, and the insurance company covers the remaining 800 for the repair.

It’s essential to read your insurance policy's terms and conditions carefully to understand what kinds of damages are covered and what your entitlements are in various situations.

[Chennai14]

Thanks for the wonderful thread.
Can anyone explain, how long Return to Invoice work? I am trying to renew my insurance for the 3rd year, have included RTI for past 2 years and will be including this year as well.
Just wondering , till how may years we can do this?

[PetrolRider]

We got our Punch for our parent' use in my native last year. As usual, we opted for maximum add on cover such as 0 dep / ROI / Engine protect etc. But, I just noticed the dealer issued the comprehensive insurance for 1st year where as 3rd party insurance for 3 years (as per new law).

So, how can I renew my comprehensive part now? Do I have to forgo my 2 remaining years of 3rd Party? Or else, the current provider can top up with only the comprehensive part with existing 3rd party? Also in the later case, I believe that I have to stick to the current insurance company for next 2 years.

[F1amit]

Hello Experts,

I need some guidance on buying insurance for a new SUV. I have booked a Seltos GTX+. Insurance price quoted by the dealer is on higher side. Thus I am exploring option to buy insurance from outside. Dealer is ok with that.

What I am not clear about is for new vehicles, what is sum insured (IDV) while buying vehicle? Is it Ex showroom value or its on road or anything else?

[F1amit]

Originally Posted by F1amit

Hello Experts,

I need some guidance on buying insurance for a new SUV. I have booked a Seltos GTX+. Insurance price quoted by the dealer is on higher side. Thus I am exploring option to buy insurance from outside. Dealer is ok with that.

What I am not clear about is for new vehicles, what is sum insured (IDV) while buying vehicle? Is it Ex showroom value or its on road or anything else?

To elaborate little further, I am exploring insurance options from outside. Dealership is ready to match the price / honor my insurance purchase from outside.

Question I have is, while purchasing insurance directly from insurance company for a new car, what is to be considered as car value? Is it only ex showroom price or I need to include Ex showroom, RTO / Registration charges, taxes etc. while getting a quote?

Looking forward to some expert advice here.

[Passerby4336]

Originally Posted by SinghBHP

Always take Gap Value / Return to Invoice Coverage while taking the insurance.

You would notice that when we buy a car the Sales guy may provide you insurance on ON_ROAD price which does not cover the additional taxes you pay on your car. In case of a theft the claim is processed on the ON_ROAD price and you lose hefty amount which you paid as taxes. The Return To Invoice or Gap Value insurance covers that and you get the claim value as per total amount at the time of purchase.

You meant to say ex-showroom price and not the on-road price. The on-road price includes road tax, insurance, etc.