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What is Motor Insurance?

Vehicle insurance or motor insurance is a type of insurance policy which safeguards you financially in case your vehicle (car or two-wheeler) sustains damages due to natural or man-made calamities such as earthquake, flood, lightning and theft among others. Working of motor insurance is pretty simple. Motor insurance is a kind of insurance policy that protects you financially if your vehicle gets damaged due to natural or man-made calamities.

Advantages of a Motor Insurance

India enjoys the dubious distinction of reporting the highest number of road fatalities in the world. And, this does not include the smaller accidents, most of which go unreported.

Another pertinent reason for the increase in the number of accidents is the fact that we are witnessing very rapid growth in the number of vehicles, but paradoxically improvement in infrastructure is not in proportion. This exposes vehicle owners to a greater risk of accidents. Insurance is necessary even if you are a good driver. One may be confident about his driving skills and would tend to avoid buying an insurance cover as it always pinches to pay the Premium especially when you do not have to make any claims. But you only realize the value of insurance, when you are in a situation and you may need to make a claim.

Motor insurance has many benefits on offer. Not only it compensates for the damages suffered by your vehicle but also takes of liabilities due to losses suffered by a third-party. It prevents out-of-expenses in getting your vehicle back into shape and gives your family a financial cushion in case of your untimely demise due to an accident. Lack of proper infrastructure makes vehicle insurance in India a necessity. With the kind of traffic management we have in India, you will hardly find a day not seeing or at least hearing about vehicles banging into each other causing major damages. Haste and negligence on top of poor infrastructure and lack of safety practices make us at Risk of road accidents in India.

How motor insurance can help?

Comprehensive motor insurance can protect you in several ways –

  • It covers your liability for third-party damages
  • It covers you for any vehicular damage that would have happened because of the accident.
  • The insurance provider would pay for the repair/replacement cost, whichever would be required to reinstate your vehicle in the same good condition as it was before the accident.
  • Motor insurance also offers protection to the driver and the occupants of the vehicle for any personal injury sustained as a result of the accident.
  • Possessing motor insurance can also provide protection from loss arising due to legal action and any Legal Liability that may arise due to accidental damages to surrounding property or people from the collision/accident of your vehicle.
  • A more holistic car insurance Policy may provide cover for the related costs of the accident, like paying for towing charges, cost of an overnight stay in a hotel and transportation costs.
  • A comprehensive policy as discussed above would also cover your vehicle damages and also the damage to the occupants in your vehicle while the accident occurs. The premiums for a comprehensive car insurance policy are higher but it pays when you are in a situation.
  • But remember, no matter how good a driver you may be, you are always exposed to the risk of getting hurt by somebody else’s negligence. The consequences of an Accident can be severe, and besides financial loss and personal injuries, it also causes severe mental stress. Having motor insurance helps relieve a lot of your financial and mental pain.