Motor insurance policies cover against any loss or damage caused to the vehicle or its accessories due to the following natural and manmade calamities.
Natural Calamities: Fire, explosion, self-ignition or lightning, earthquake, flood, typhoon, hurricane, storm, tempest, inundation, cyclone, hailstorm, frost, landslide, rockslide.
Man made Calamities: Burglary, theft, riot, strike, malicious act, accident by external means, terrorist activity, and any damage in transit by road, rail, inland waterway, lift, elevator or air.
Motor insurance provides compulsory personal accident cover for individual owners of the vehicle while driving. One can also opt for a personal accident cover for passengers and third party legal liability. Third party legal liability protects against legal liability arising due to accidental damages. It includes any permanent injury/death of a person and damage caused to the property.
The vehicles are insured at a fixed value called the Insured’s Declared Value (IDV). IDV is calculated on the basis of the manufacturer’s listed selling price of the vehicle (plus the listed price of any accessories) after deducting the depreciation for every year as per the schedule provided by the Indian Motor Tariff.
If the price of any electrical and / or electronic item installed in the vehicle is not included in the manufacturer’s listed selling price, then the actual value (after depreciation) of this item can be added to the sum insured over and above the IDV. In case the vehicle is fitted with CNG / LPG, the CNG/LPG kit fitted to the vehicle is to be insured separately at an additional premium.
It is to be noted that it is not only driving of the vehicle without insurance will contravene the Act. The mere presence of a motor-vehicle in a stationery condition in a public place will also constitute the ‘use.’ Secondly the use should be made in a ‘Public Place’ as defined earlier. Any place where the public have a right to access is constituted as a “Public Place.”
All places were members of public have an access, for whatever reasons, whether as of right or controlled in any manner whatsoever, would be covered by the definition of “Public Place.” However, a person driving a motor vehicle merely as a paid employee will not be treated as contravening the Act, if he has no knowledge that there is no policy in force.
Extracts from “Guide for Motor Insurance (IC-72)” by Dr. Rakesh Agarwal. Copyright of Sashi Publications, kolkata www.sashipublications.com and www.bimabazaar.com
