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Understanding Motor Insurance in India: Types and Benefits

Submitted by admin on March 24th, 2025

Your vehicle or motor or car is simply an investment of yours. It is a legal requirement in India and an essential financial safeguard against accidents, theft, and damages. Having a right insurance is very necessary from every way. It simply offer you’re the protection from unforeseen expenses. There are so many insurance plans available. You can check out the each of these and get best of the coverage. Let’s explore the key types of motor insurance:

Third-Party Motor Insurance (Mandatory)

What It Covers:

• Liability for injuries or death of a third party
• Damage to third-party property
• Legal expenses arising from third-party claims

What It Doesn’t Cover:

• Damage to your own vehicle
• Injuries sustained by you

Why It’s Important?

There are so many reasons like Third-party insurance is mandatory under the Motor Vehicles Act, 1988. If you drive without it then you may face hefty fines or even imprisonment. In fact this plan is budget-friendly, it offers limited protection.

Comprehensive Motor Insurance

What It Covers:

• Third-party liabilities
• Damage to your own vehicle due to accidents, natural disasters, fire, or theft
• Personal accident cover for the driver
• Additional benefits through add-ons

What It Doesn’t Cover:

• Wear and tear
• Driving without a valid license or under the influence
• Mechanical or electrical failures

Why Choose It?

• A comprehensive motor insurance policy provides 360 degree protection.
• It is ideal for car and bike owners who want peace of mind knowing their vehicle is covered against both third-party and own damages.

Own Damage Cover

What It Covers:

• Accidental damage to your vehicle
• Damage due to natural calamities like floods, earthquakes, or storms
• Vandalism or fire damage
• Theft of the vehicle

What It Doesn’t Cover:

• Third-party liabilities
• Damages caused by negligence (like driving under the influence)

Who Should Opt for It?

• If you already have third-party insurance but want extra protection for your own vehicle, an Own Damage (OD) Cover is the right choice.
• This is especially useful if your car or bike is new and expensive to repair.

Zero Depreciation Add-On

What It Covers:

• Full claim settlement without depreciation deduction on parts like plastic, rubber, and metal
• Repair or replacement costs covered at 100% value

What It Doesn’t Cover:

• Regular wear and tear
• Engine damage due to oil leakage or water ingression

Why Add Zero Depreciation?

• A standard insurance policy deducts depreciation costs while settling claims. With a zero depreciation add-on, you get the full value of replaced parts without deductions.
• This is beneficial for new cars or luxury vehicles where repair costs are high.

Conclusion

Choosing the right motor insurance depends on your budget, vehicle type, and risk appetite.

If you just want legal compliance, third-party insurance is enough.

For complete protection, go for a comprehensive policy with add-ons like zero depreciation. Own damage cover is ideal for those with a separate third-party policy.

Want to secure your vehicle with the best motor insurance? Compare plans today and drive worry-free!

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