All About Commercial Car Insurance in India
Updated On Oct 15, 2023
Commercial Car Insurance in India - Key Features, Exclusions, & How to Choose?
Do you own or drive a company vehicle? Well, you’re in luck. Today, we're going to discuss commercial car insurance, which is crucial for everybody in India who drives or owns a company vehicle. Are you prepared to explore this important subject? Let's get going!
Table of Contents
- What Is Commercial Car Insurance Exactly?
- The Need for Discussing Commercial Car Insurance
- Different Coverage Types
- Key Features of Commercial Car Insurance
- Exclusions from Commercial Car Insurance
- What happens if you don’t have Commercial Car Insurance?
- How to Choose a Commercial Car Insurance Policy?
- 1. Recognise the needs of your business
- 2. Consider the Type of Vehicle
- 3. Note the Environmental and Geographic Factors
- 4. Compare Various Coverages
- 5. Premium and Budgetary Considerations
- 6. Examine Reviews and Look for Suggestions
- 7. Optional Add-ons
- 8. Claims Settlement Ratio
- 9. Customer Support
- The role of add-ons
- How to File an Insurance Claim?
- Required Documents to File a Claim
- Commercial Vehicle Types
- Things to Take Into Account When Renewing Commercial Car Insurance
- What Makes Renewal Important?
- How Do You Renew?
- Factors Affecting the Cost of Commercial Car Insurance
- How Are Commercial Auto Insurance Premiums Calculated?
- How Can Commercial Insurance Plans Be Compared?
- Why should you get commercial car insurance online?
What Is Commercial Car Insurance Exactly?
Commercial auto insurance is comparable to a safety net for your company cars. If there are any accidents, thefts, or other misfortunes with your car, it helps you out monetarily. In other words, it ensures that a minor setback does not become a significant financial burden for you. It's important to take care of your company's assets and make sure you're ready for anything unforeseen in addition to obeying the law.
The Need for Discussing Commercial Car Insurance
Let's take a brief look at why commercial auto insurance is so important before getting into the specifics. Commercial cars are all over India's congested roadways, moving people and commodities and sustaining the country's economy. A safety net is necessary for these vehicles, and that is what commercial auto insurance provides.
Please note Commercial Car Insurance provides a safety net not just to the car but can also provide a safety net to the traveling passengers and the driver. Now let's delve deeper into it!
Different Coverage Types
Let's talk about the many coverage options offered by business auto insurance:
- Third-party liability insurance: Third-party liability insurance protects you financially in the event that your car unintentionally damages someone else or their property. It's a mandated, basic insurance.
- Comprehensive Coverage: Comprehensive Coverage is a more comprehensive insurance plan that includes coverage for theft, damage to your car, and third-party liability, among other things.
- Collision Coverage: This insurance protects you in the event that an accident damages your car.
- Personal Injury Protection (PIP): In the event of an accident, this one assists in paying the driver's and the passenger's medical expenses as well as their missed income.
- Uninsured/Underinsured Motorist Coverage: This pays for damages incurred in an accident involving a party who lacks adequate insurance.
Key Features of Commercial Car Insurance
- Greater Coverage: Due to the increased risks involved with business vehicles, commercial auto insurance provides a greater level of coverage.
- Liability resulting from injuries or losses to other parties is covered under third-party liability.
- All-inclusive Coverage: This offers a defense against theft, natural disasters, and other losses.
- In the event of an accident, personal accident coverage protects the driver.
- Add-ons: Provides companies the option to personalize their policy by adding other coverages like engine protection, zero depreciation, etc.
- Included in Commercial Auto Insurance:
- Accidental Damages: Any harm an accident causes to the commercial vehicle.
- Natural Calamities’ Damages: Storms, earthquakes, and floods are examples of natural calamities that can be prevented.
- Theft: In the event that the car is taken.
- Third-party liability: Liability for losses or injuries to third parties.
- Personal Accident Coverage: Payouts in the event that the driver passes away or becomes permanently disabled.
Exclusions from Commercial Car Insurance
- Normal Wear and Tear: Gradual deterioration of the transport system.
- Drunk Driving: Any harm done while operating a motor vehicle while under the influence of alcohol or drugs.
- Illegal Activities: Any harm or responsibility brought on by engaging in unlawful activity.
- Invalid Driver's Licence: If the driver's licence isn't valid.
- War and Nuclear Risks: Losses resulting from nuclear reactions, invasions, or wars.
What happens if you don’t have Commercial Car Insurance?
Your commercial vehicle is under serious risk if it doesn’t have a running insurance policy attached with it, be it attracting challans from regulatory authorities or heavy out of pocket expense in case of an accident.
It is not recommended to not have a commercial car insurance or delay renewing your commercial car insurance for your vehicle owing to the following -
- If you don't have an active commercial car insurance policy then you are breaking the law. In case you get caught driving without an active car insurance your vehicle can get seized along with a hefty penalty being levied to your vehicle.
Both impounding and heavy penalty can lead to significant business and time loss for your area of work and hence should be avoided
- Without an active commercial car insurance you would face serious hurdles in moving products across borders as it will not be allowed
- In case of an accident, the damage incurred to your vehicle can be huge and hence that might involve paying a big amount of money from your own pocket to get the car serviced and hence might put a dent on your finances and operation
How to Choose a Commercial Car Insurance Policy?
You need to use your analytical skills when choosing the best policy for your commercial vehicle. It's important to establish a financial safety net that aligns with your company's demands and day-to-day operations in addition to an insurance policy. Let's go over the procedures and factors that will help you arrive at a well-informed choice.
1. Recognise the needs of your business
First and foremost, you must clearly understand what your company actually requires. Are the majority of the time your cars used for short-distance local deliveries or are they employed to transport items between states? The kind of coverage you require will vary greatly depending on the kind of service you offer.
2. Consider the Type of Vehicle
Your insurance requirements will also depend on the kind of car you drive. That being said, a delivery van or a cab will undoubtedly have different insurance requirements than a freight truck. Verify that the dangers specific to your vehicle type are covered by your policy.
3. Note the Environmental and Geographic Factors
Consider the locations where your cars are used the most. Are there many accidents or thefts in these areas? Are the roads well-maintained? Your choice of policy should be influenced by factors such as these. If you operate in high-risk areas, you might want to look into a policy that provides more extensive coverage.
4. Compare Various Coverages
There are other coverages, such as comprehensive, collision, third-party, and others, as we previously covered. Recognise the benefits of each coverage and determine which are essential for your company. Speaking with an insurance representative to find out what coverages might be useful to you is usually a smart idea.
5. Premium and Budgetary Considerations
It should go without saying that selecting a policy is heavily influenced by your budget. Although it may be alluring to choose a policy with a lower premium, keep in mind that it might not provide sufficient coverage. Achieve equilibrium between the expenses and the advantages that the policy provides.
6. Examine Reviews and Look for Suggestions
Researching potential insurance options is a wise move before choosing one. Choose reputable insurance by reading reviews, asking for referrals, and perhaps even speaking with other business owners in your network.
7. Optional Add-ons
Think about the various available add-on features. These are extra safeguards that you might include in your standard policy to strengthen it. Determine whether these extras are valuable to your company and think about adding the ones that are.
8. Claims Settlement Ratio
Examine the insurer's claims settlement ratio as it shows how many cases the company has resolved. It can be comforting to know that a higher ratio means the insurer is more likely to resolve disputes.
9. Customer Support
Finally, think about how well the insurer provides customer service. You would want to work with an insurer who provides timely and friendly assistance in the event of an accident.
Selecting the appropriate commercial auto insurance plan means matching the needs of your vehicle with the appropriate level of security. It's an important step in making sure your business runs smoothly when travelling. Keep in mind that the objective is to obtain insurance that provides peace of mind while navigating India's busy roads in addition to complying with legal requirements.
The role of add-ons
You can enhance the protection of your basic policy by adding add-ons, which are additional features. These can include covering the engine particularly or obtaining roadside help around-the-clock. They function similarly to additional safety net cushions.
How to File an Insurance Claim?
It's safe to say that nobody enjoys having to submit an insurance claim. However, accidents may happen, and being aware of how to handle the claims procedure could help you avoid wasting a lot of time. We'll walk you through the entire claim process for commercial car insurance in this part, allowing you to handle the procedure with confidence and comfort.
1. Prioritise safety first
Making sure that everyone involved is safe should be the top concern in the case of an accident or disaster. If it becomes essential, relocate to a secure area and make sure those in need of medical attention receive it.
2. Let the Police Know
Depending on the situation, reporting it to the local police may be required. It is imperative to file a police complaint in cases of incidents involving substantial damages or bodily injuries.
3. Record the Occurrence
Next, be sure to take detailed notes of the incident. This could entail documenting the incident's specifics, taking pictures of the damages, and, if feasible, obtaining witness testimony. These specifics can be very helpful in the processing of your claim.
4. Let Your Insurance Company Know
Inform your insurance company about the occurrence as soon as you can. You can file a claim using the websites and toll-free helplines provided by the majority of insurance firms. The claim procedure usually goes more smoothly the sooner you report.
5. Complete the Form for the Claim
An extensive claim form will be provided to you by your insurance company. The information requested on this form pertains to the occurrence and includes the date, time, place, and type of loss or damage. Make sure you complete this form as accurately as possible.
6. Wait for the Surveyor
The insurance company typically assigns a surveyor to determine the amount of the damage when the claim form is received. The surveyor will assess the circumstances and submit a report to the insurance provider, which serves as the foundation for the settlement of your claim.
7. Send in Required Documents
To bolster your claim, you will need to provide a number of supporting papers. This could contain the police record (if any), pictures, repair invoices, and so on. In order to prevent any delays in the claim procedure, make sure you have all pertinent documentation available.
8. Get on With the Repairs
You can start working on the vehicle's repairs or restoration after the surveyor's evaluation. The insurance provider may have a network of garages where you can get the repairs done, depending on your policy.
9. Receive the approval
The insurance company will handle the claim processing after all required procedures are finished. If your claim is accepted, they will pay the full amount due and either directly cover the cost of repairs or reimburse you for any out-of-pocket expenses.
10. Ask a Claims Adjuster for Help, If Needed!
Should you find the procedure difficult, you may want to think about getting help from a claims adjuster. A claims adjuster is a qualified individual who can guide you through the claims process and deal with the insurance company on your behalf.
Required Documents to File a Claim
- Duly-filled Claim Form: Provided by the insurer.
- The vehicle's RC (registration certificate).
- Driving Record.
- FIR: In the event of theft or harm to third parties.
- Original Repair Bill: After the fixes.
Commercial Vehicle Types
- Vehicles used to transport goods: trucks, tempos, and lorries.
- Vehicles that carry passengers: taxis, buses, and auto rickshaws.
- Certain kinds of vehicles: shovels, forklifts, and cranes, among others.
- Other Vehicles: Trailers, tractors, and other vehicles that don't fall into the other categories.
Things to Take Into Account When Renewing Commercial Car Insurance
- Dispute History: Take into account your prior claim history and any bonuses you have earned.
- Needs for Coverage: Determine whether the coverage you now have is adequate or whether you require more.
- Premiums: Make sure the rates are reasonable and provide good value.
- The Credibility of the Insurer: Seek out insurers with high ratios of settlements for claims.
What Makes Renewal Important?
Maintaining coverage continuity is essential for protecting against unanticipated dangers. Purchasing new coverage after a lapse may result in higher premiums. Policyholders are also eligible for No Claim Bonus benefits with regular renewals.
How Do You Renew?
- Online Renewal: Go to the insurer's website, fill out the policy information, pay the premium, and get your coverage right away.
- Offline Renewal: To renew the insurance, get in touch with the insurer directly or via an agent.
- Cost of business Auto Insurance: Because business vehicles have more risks and responsibilities than personal automobiles, the cost of commercial auto insurance is typically greater.
Factors Affecting the Cost of Commercial Car Insurance
- Vehicle Type: The cost of insurance may be greater for heavy-duty cars.
- Use of Vehicle: Compared to passenger carriers, goods transporters may be subject to varying surcharges.
- Geographical Area: Insurance rates may be higher for cars driven in regions that are prone to accidents.
- Claim History: The cost may be impacted by prior claim records.
How Are Commercial Auto Insurance Premiums Calculated?
A lot of insurance companies have online premium calculators. By providing information such as the type of vehicle, age, location, and accessories, companies can obtain immediate premium quotations.
How Can Commercial Insurance Plans Be Compared?
- Online Comparison Sites: Give current coverage and price comparisons between various insurance.
- Provided Coverage: Make sure the insurance under comparison provides comparable coverage.
- Customer Reviews: To determine how satisfied customers are, read the reviews.
- Ratio of Claim Settlement: Better dependability is indicated by a higher ratio.
Why should you get commercial car insurance online?
Today's digital age has made convenience a valuable commodity, and the insurance industry has changed significantly to provide simplified solutions at your fingertips. Obtaining a commercial auto insurance policy is no longer a time-consuming process that requires numerous office visits and mountains of paperwork. Let's explore how purchasing and managing insurance has been made easier for business owners like you via the Internet.
1. Simple Purchase Process
Buying an insurance policy online is a very simple process. From the convenience of your home or place of business, you may browse through several policy options and compare them to discover which one best fits your needs. Choosing and buying insurance only requires a few clicks, saving you time that you can use to grow your company.
2. Easy To Compare
The online tool provides an excellent way to compare different policies in a much more efficient way. It is simple to compare the features, costs, and advantages of several policies, giving you the information you need to make an informed choice.
3. Tailored Processes
It's now easier than ever to customise insurance coverage to fit your unique business demands thanks to online insurance platforms. Numerous insurers provide you with the option to personalise your insurance with different features and add-ons, ensuring that it is as distinctive as your company.
4. Quick Quote Generation
The days of needing days to receive a quote for your policy are long gone. Making decisions more quickly is made possible by the ability to obtain instant quotations from several insurers with only a few facts. This function facilitates more effective budgeting and spending planning.
5. Electronic Recordkeeping
With online insurance, all of your vital records are kept digitally, where they are safe and readily available for use when needed. The process of digitising papers lowers the possibility of misplacing important paperwork and greatly streamlines policy administration.
6. Simple Policy Updating
It's easy to renew your coverage online. You can make sure there is no gap in your coverage by renewing your insurance before it expires with prompt processing and reminders. To continuously safeguard the assets of your company, this ongoing coverage is necessary.
7. Constant Customer Service
The majority of online platforms have 24/7 customer service, ready to help you with any questions or problems you may encounter. You can feel secure knowing that assistance is only a click or phone call away thanks to its round-the-clock access.
8. Handy Mobile Apps
For managing policies, a lot of insurers provide web portals and smartphone apps. Through your computer or smartphone, these platforms not only make it simple to buy and renew insurance, but they also offer a host of other features like the ability to follow the status of claims, ask for help, and much more.
9. Sustainable Process
Last but not least, choosing online insurance also reflects your environmental consciousness. Since the digital approach eliminates the need for paper documentation, it is ultimately a more environmentally friendly choice.
In conclusion, business auto insurance is your car's greatest ally on India's busy streets. It's a guarantee of security and safety, making sure that traffic accidents won't cause significant setbacks for your company.
Thus, make sure your business vehicle is covered when you drive it by getting the best commercial auto insurance. It's about making progress towards a time when your company can expand risk-free and with assurance. Recall that maintaining a solid insurance coverage involves more than just abiding by the law—it also entails being proactive and taking care of your company.
And that's everything for now! Hopefully, this information will enable you to fully grasp the significance of commercial auto insurance in India. Be careful and drive safely!
1. What precisely is commercial car insurance?
A particular kind of insurance policy called commercial auto insurance is made to protect vehicles used for business travel. It assists in shielding company owners from monetary losses brought on by mishaps, thefts, or other harm to the automobiles they use for commercial purposes.
2. Is insurance for commercial vehicles required in India?
Yes, in order to lawfully drive on the highways, all vehicles—including those used for business purposes—must have at least a third-party liability insurance policy, according to the Indian Motor Vehicles Act.
3. What distinguishes personal auto insurance from commercial auto insurance?
Commercial auto insurance is specially made to protect automobiles used for company operations, whereas personal auto insurance is meant to cover private vehicles used for personal purposes. Higher liability limits and extra coverages that address the unique requirements and dangers connected to the operation of commercial vehicles are frequently included.
4. What kinds of coverage are offered by business auto insurance?
Different coverage options, such as comprehensive, collision, and third-party liability, are typically provided by commercial auto insurance. These coverages can shield you against various financial hazards related to collisions, thefts, or other mishaps affecting your commercial vehicle.
5. Can I make changes to my business auto insurance policy?
Of course! By selecting from a variety of features and add-ons, you can tailor your policy to meet your unique company requirements. Roadside help, engine protection cover, and zero depreciation cover are a few examples of common add-ons.
6. What variables affect a commercial auto insurance policy's premium?
The kind of vehicle, age, place of operation, chosen coverage, and claim history are some of the variables that affect the premium price. It is recommended to have a conversation about the precise premium estimates with your insurance provider.
7. In the event that my business vehicle is damaged or has an accident, how can I file a claim?
You must notify your insurance company of the incident as soon as possible before you can file a claim. Subsequently, you must send in a properly completed claim form and any required supporting documentation for your claim. You will receive guidance from your insurance provider during the entire procedure, which will involve assigning a surveyor to evaluate the damages and finalise the claim.
8. I want to sell my automobile, is it possible for my commercial auto insurance coverage to follow?
Yes, you can provide the new owner of your business vehicle the coverage you currently have if you sell it. Within 14 days of the vehicle's ownership transfer, this transfer must be completed.
9. What does commercial auto insurance's No Claim Bonus (NCB) mean?
If there were no claims filed during the last policy period, the insurance company will give you a discount on the renewal cost. This is known as a no claim bonus. It serves as a benefit for safe driving and the absence of claims, motivating the policyholder to keep up a clean driving record.
10. Can I purchase and renew my business auto insurance online?
Of course! Online policy purchases and renewals are available from the majority of insurance companies. You can easily and conveniently compare insurance, get rates, buy new policies, and renew existing ones by going to the insurer's website or mobile app.