Auto Insurance

                       

FAQ ON AUTO INSURANCE

 WHAT TYPES OF POLICIES ARE AVAILABLE FOR MOTOR VEHICLES?

WHAT IS THE DIFFERENCE BETWEEN THESE TWO POLICIES?

WHO IS A THIRD PARTY?

WHAT IS A PUBLIC SERVICE VEHICLE?

WHEN CAN AN AUTO INSURANCE POLICY BE RENEWED?

HOW AN INSURANCE CLAIM CAN BE FILED IN THE EVENT OF COMPLETE DAMAGE TO THE VEHICLE?WHAT TYPES OF POLICIES ARE AVAILABLE FOR MOTOR VEHICLES?There are two types of policies available for motor vehicles - third party insurance -policy A and comprehensive insurance policy- policy B.WHAT IS THE DIFFERENCE BETWEEN THESE TWO POLICIES?Third party insurance policy covers only the inter-alia liability of the vehicle owner for loss or damage to life or property of the third parties whereas comprehensive insurance policy covers in addition to third party liability, loss or damage to the vehicle itself byway of accident, theft, etc and specified perils.WHO IS A THIRD PARTY?According to the Motor Vehicles Act, a third party is any person who is not the insured or the insurer and includes the Government. Pedestrians constitute a large section of third parties. The pedestrians have not only a right to use the footpath but also occasionally to use the road and also cross it. Fare-paying passengers are those who are carried in a public service vehicle. 

The owner of the vehicle has a legal duty not only to provide roadworthy vehicles but also to appoint competent drivers. The owner’s responsibility commences from the time the passenger enters the vehicle and continues until he alights from it.

Any accident in the interim period is the responsibility of the owner. Non-fare paying passengers are those who are allowed to travel in the vehicle by gratis. In other words, owner of goods traveling in the goods vehicle hired by him for transportation of his goods is a non-fare paying passenger.

Passengers allowed travel on humanitarian grounds are also non-fare paying passengers.

The duty of the vehicle owner towards such passengers is to provide them with a reasonably safe mode of conveyance. Persons in other vehicles like drivers, the owner or passengers are also third parties. Children are not expected to exercise the same care as adults and therefore the driver of a motor vehicle has to show extra care towards children on the roads.WHAT IS A PUBLIC SERVICE VEHICLE?A Public Service vehicle means any motor vehicle used or adapted to be used for the carriage of passengers for hire or reward. It includes luxury taxies, auto rickshaws, taxicabs and passenger buses.WHEN CAN AN AUTO INSURANCE POLICY BE RENEWED?The policy has to be renewed before the expiry of the period and any delay in renewal of the policy attracts a penalty for renewal. There are other hassles involved too, like a surveyor (inspector) from the insurance company will inspect the vehicle again. Besides, most importantly, it is an offence by law to drive an uninsured car.HOW AN INSURANCE CLAIM CAN BE FILED IN THE EVENT OF COMPLETE DAMAGE TO THE VEHICLE?Complete damage or total loss (as it is popularly known) occurs in the event of the vehicle being beyond repair after an accident or fire etc. In such cases, the insurance company declares the car as a ‘total loss’. 

Typically, one can claim total loss damages as follows: 
Inform the insurance company the time, date and place of the accident. You can get a standard form for filling in these details from any insurance company branch.File a First Information Report (FIR) at the police station closest to the place of mishap. Documents related to the vehicle like registration book, tax paid receipt, insurance papers, driving licence, etc. are needed while lodging the FIR.You will need to surrender the following to the insurance company:Original registration certificate bookDuplicate keyThe ownership of the car is then transferred to the insurance company and documents pertaining to transfer of ownership are filed. A No Objection Certificate (NOC) is required from the Regional Transport Authority (RTO) for the transfer of the vehicle.If the vehicle has been damaged by fire, then a report from the Fire Brigade authorities will also be required.‘Total Loss claims’ could take a long time depending on how quickly or otherwise you are able to arrange for reports from the police and the fire brigade. To enable the process go smoothly, it is advised to keep all documents related to the vehicle handy. However, vehicle surveyors are a moody lot, and one may have to bargain a bit to increase the claim amount from the insurance company.