Are you an owner of a commercial vehicle? Are you worried about unforeseen incidents disturbing your finances? Well, in that case, you need a comprehensive commercial vehicle insurance plan. This sub-section of vehicle insurance is a sought-after solution to cover any monetary liabilities that may arise due to an unpredicted event.
So, read on to learn more about commercial vehicle insurance, its importance, and its subtypes to make a knowledgeable decision.
What is Commercial Vehicle Insurance?
Commercial vehicles are different from personal vehicles; therefore, they require customised insurance policies that effectively cover most damages caused to and/or by the vehicle. It usually financially covers the owner-driver of the vehicle alongside the third party.
In India, third-party commercial vehicle insurance is mandatory, and it applies to public buses, taxis, app-cabs, trucks, auto-rickshaws, commercial vans, tractors, or any automobile in that case.
Additionally, with the right commercial vehicle insurance online in place, the policyholder can conveniently tackle any accident or damage due to natural or man-made incidents.
Why is Commercial Vehicle Insurance Important?
Besides giving the apparent benefits of covering the expenses incurred due to accidental damages, a commercial vehicle insurance policy in India has the following importance:
- It allows the policyholder to determine the vehicle’s IDV or insured declared value.
- A third-party commercial vehicle insurance plan protects the owner against any lawsuit that arises in case of damage to the third-party property/person by the insured vehicle.
- The policyholder can qualify for a ‘no claim bonus’ during the commercial vehicle insurance renewal and save on premium payments by not making any claim during a particular policy year.
- The selected insurance company may also provide cashless repair facilities in the event of an accident or damage to the vehicle.
- The insurance plan for commercial vehicles offers tax deduction benefits for the business owner under the same name.
Types of Commercial Vehicle Insurance Policies in India
There may be different names for commercial vehicle insurance policies in India. However, primarily, depending on the nature of coverage, three types of insurance plans are popular for any commercial vehicle. These are:
1, Third-party Commercial Vehicle Insurance Plan
A third-party commercial vehicle insurance plan covers financial liability in case a third-party property or vehicle damages or the death of a person by the insured vehicle. Moreover, it is mandatory to have a third-party insurance policy for all cars plying on Indian roads, including commercial vehicles. Violating the same attracts penalties, legal obligations, or even imprisonment.
2. Comprehensive Commercial Vehicle Insurance Plan
Comprehensive commercial vehicle insurance offers all-round protection to policyholders. This particular vehicle insurance plan extends third-party and own damage coverage in case of any mishap. This means that it takes care of the third-party liabilities and offers financial assistance for any damages suffered by the driver, passenger, and the insured vehicle.
A comprehensive vehicle insurance plan also safeguards the policyholder in different circumstances like accidents, theft, fire, damage, and flood.
Furthermore, there is another type of commercial car insurance available in India, which is beneficial, especially for SMEs.
3. Fleet Commercial Vehicle Insurance Plan
A fleet commercial vehicle insurance plan is a great relief to owners who have four or more vehicles. With this motor insurance plan, fleet owners can insure multiple vehicles of different types by paying a single annual premium. For instance, if you have a fleet of trucks, then opting for lorry insurance or truck insurance like this proves beneficial.
Usually, companies that use multiple vehicles for commercial purposes opt for this insurance plan. It saves them from the hassle of maintaining different insurance plans for different vehicles and facilitates cost-effective and time-saving solutions. Furthermore, the coverage offered by this plan is almost the same as the other two commercial car insurance plans.
Inclusions and Exclusions in Commercial Vehicle Insurance
Like other insurance plans, commercial vehicle insurance online also has a list of inclusions and exclusions pre-specified by the insurance company.
The following are covered by a commercial vehicle insurance plan in India:
- Third-party damages
- Accidents
- Theft
- Fire-related damages
- Natural disasters
- Personal injuries
The general exclusions of a commercial vehicle insurance plan in India include the following:
- Driving without a valid license
- Drunk driving
- Damage due to negligence of the driver like driving in flood-affected areas, etc.
- Any damages that are not covered in the policy contract
- Regular wear and tear
- Rash driving
- Electrical failures
Note that the inclusions and exclusions of the plan are subject to the discretion of the policy providers.
Add-on Covers Available for Commercial Vehicle Insurance
Policyholders can also choose add-on covers with their existing commercial car insurance plan depending on the requirements and choice. However, they need to pay an increased premium amount to avail the facilities.
Some of the most popular add-on covers for commercial vehicle insurance plans are mentioned below:
- Zero depreciation cover
- Consumable cover
- Lock and key replacement cover
- Breakdown assistance
- Return to invoice
- NCB or no claim bonus cover
Factors that Affect Commercial Vehicle Insurance Premiums
The premium cost of a commercial vehicle insurance policy in India depends on the following factors:
- Location of the vehicle registration
- Make and model of the vehicle engine
- No claim bonus
- Type of vehicle
- Type of plan chosen
How to Choose the Right Commercial Vehicle Insurance Policy?
While several insurance companies offer commercial vehicle insurance renewal and policies in India, choosing the right one for you needs further consideration in the following aspects:
- Insured Declared Value (IDV): Top insurance companies let one choose IDV with varying premium costs.
- Policy coverage: It is necessary to compare different commercial vehicle insurance online for the best policy coverage.
- Network garages: Look for insurers that offer cashless repair facilities at their network garages.
- Add-ons: Before finalising the deal, make sure to check the add-on covers that are available to you.
- Reputation of the insurer: For a seamless claim settlement, it is better to opt for an insurer with a good reputation in the market, even if it costs you a little more. This will include an excellent claim settlement ratio, an easy claim and renewal process, etc.
Additionally, selected insurance companies offer 24/7 online support and apps, making commercial vehicle insurance renewal online hassle-free.
Conclusion
In a nutshell, commercial vehicle insurance extends the needed financial safety net to business owners and helps them function in peace. Having said that, as a prospective insurance buyer, you need to remember the sub-types, inclusions, exclusions and a few additional pointers to ensure you are making a sound decision that fulfils your purpose.
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