Motor insurance, mandated by the Motor Vehicles Act since 1938, covers risks related to vehicle use, including property damage and bodily injuries. It comprises two main components: third-party liability and owner’s damage, with various add-on covers available such as zero depreciation and engine protection. Factors affecting premiums include vehicle type and age, driver condition, and geographical area of use.

1. DEVTECH FINANCE
GENERAL INSURANCE MODULE
MOTOR
INSURANCE
MEANING OF MOTOR
INSURANCE
TYPES OF POLICIES &
COVERAGE
ADD ON COVERS &
EXCLUSIONS
THIRD PARTY LIABILITY

2. INTRODUCTION
• Motor Vehicle Insurance is the insurance coverage of risk arising out of the use
of motor vehicle such as car, truck or other vehicles causing damage and loss to
oneself as well as other’s property in an accident.
• Motor Insurance is mandatory as per the Motor Vehicles Act passed in the year
1938 and subsequently amended.
• Motor Insurance provides coverage related to property damage, bodily injury,
medical expenses and any other sort of compensation in legal proceedings.
• It is also referred as Auto Insurance, Vehicle Insurance and Car Insurance.

3. TYPES OF MOTOR INSURANCE
• Private Car Insurance
• Commercial Vehicle Insurance
• Defense Vehicle Insurance
• Two Wheeler Insurance
Private Car
Insurance
Commercial
Vehicle
Insurance
Defense
Vehicle
Insurance
Two wheeler
Insurance

4. THIRD PARTY LIABILITY
Motor Vehicle Insurance generally comprises of following two components –
Third party liability coverage is the part of insurance policy which protects you in
case you are sued or asked compensation for any physical injury or damage to
someone else’s property by your vehicle accidently.
Third party liability could be of following nature – Bodily injury liability and Property
damage liability.
Third Party Liability
(mandatory)
Owner’s Damage
(optional)

5. FACTORS AFFECTING PREMIUM
• Type of vehicle
• Physical condition of driver
• Geographical area of use
• Age of vehicle
Type of
vehicle
Physical
condition of
driver
Geographical
area of use
Age of
vehicle

6. COVERAGE AND EXCLUSIONS
LOSS/DAMAGE COVERED
• Loss or damage by accident,
fire, lightning, theft, malicious
act, natural disaster
• Third party liability in form of
injury ,death and damage to
property
• Medical Expenses
EXCLUSIONS
• Normal wear and tear
• Damage when person was
driving without license
• Damage when person was
driving in influence of alcohol
• Damage due to a war

7. ADD ON COVERS
• Zero depreciation cover - You get the whole cost of repairs to external car body
damages irrespective of the depreciation amount. Since this is an add-on cover, you pay
a higher premium. Your insurer pays for the repairs/ replacement of the plastic and fibre
components of your car.
• Engine protection cover - An engine protection cover is an add-on to your Car
Insurance policy, that is meant to cover any damages to the engine through leakage,
water damage, physical damage etc. It thus compensates you for the repair/replacement
of your engine.
• Roadside assistance cover - A roadside assistance in insurance cover keeps your
insurer at your service so that you can contact your insurer immediately after the
accident or in any emergency. It provides roadside services such as repair on the spot,
emergency fuel delivery, flat tyre service, driver disability, shipment of spares, towing to
nearest repair centre, accommodation and cab service.

8. ADD ON COVERS
• Consumable cover - Car insurance usually does not compensate or pay for any of the
car’s consumables damage. At the time of claims, you are supposed to pay yourself for
the replacement of these consumables. To avoid this, you could opt for a Consumables
Cover in Motor Insurance. A Consumables Cover is an add on insurance cover that pays
for the cost of consumables like nut and bolts in Car Insurance required to be replaced
or refilled in the event of an accident of your car.
• Return to invoice cover - In case of incidents where you lost your car completely due
to fire or theft, your insurance company would pay you only upto the IDV (Insured
Declared Value) which is much lower than the Invoice value of the car. With a return to
invoice protect add-on cover, you could get as much as the invoice value of your car, in
case of total loss of the car.

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FINANCE