Commercial Vehicle Insurance

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Every motor vehicle that comes to the road, has to be insured. Whether you own a bike, a car or a commercial vehicle, an insurance policy is mandated by the government under the Indian Motor Act. In this article, we will learn all about Commercial Vehicle Insurance.

What is Commercial Vehicle Insurance?

A commercial vehicle is a vehicle that is used to carry goods or to fare passengers. Just like a private car or bike, a commercial vehicle also needs insurance cover. Through commercial vehicle insurance, you can cover the expenses you may have to incur in case of any loss caused by or to a commercial vehicle. The causes of damage may include accidents, natural disasters, collisions, theft or fire. It is binding for all businesses to have a commercial vehicle insurance plan for all their vehicles.

Importance of Commercial Vehicle Insurance 

For any business or an entrepreneur, commercial vehicles are quite essential and thus insurance of these commercial vehicles also becomes very important. Let us take a look at the reasons why you should have Commercial Vehicle Insurance:

  1. Having a Commercial Vehicle Insurance is mandated by law. Not having one can land you in trouble.
  2. Accidents can happen anywhere and anytime. In case your commercial vehicle damages some other person or someone else’s property, the liability of the repair cost would lie on you. In such a situation your commercial insurance would protect you from such a financial crisis.
  3. In case your own commercial vehicle is damaged in an accident, your insurance plan would pay for the damages
  4. If you are using a commercial vehicle to fare passengers, your insurance plan would also protect and cover them.
  5. Commercial Vehicle Insurance also protects the paid driver along with his family in case of a disability or even death.

What is Covered in Commercial Vehicle Insurance?

When you buy comprehensive commercial vehicle insurance, you have the following facilities:  

  • Third-Party Liability
    Under this type of insurance, the liabilities that arise due to the involvement of a third-party are covered. It could be a physical injury or death of a person, damage caused to someone else’s property.
  • Personal Accident Cover
    Personal Accident Cover comes as an inbuilt cover. If the owner or the employed driver gets injured or dies in a road accident, the commercial vehicle insurance would provide cover for the loss.
  • Own Damage Cover
    Under this insurance, the following are covered:
    • Man-made disasters such as theft, terrorism, riots
    • Natural disasters such as earthquakes, fire, flood etc
    • Damages during transportation through air, water and road
  • Towing Coverage
    Many companies that offer commercial vehicle insurance also offer towing facilities as a part of the policy. This service proves to be very helpful in case the vehicle gets disabled and can only be towed.

What is Not Covered in Commercial Vehicle Insurance?

When making a claim, keep in mind that the following conditions/facilities are NOT included in coverage:

  • Accidents that arise in non-geographical regions for that vehicle
  • A vehicle was driven by someone other than the driver in charge
  • The vehicle used for other unspecified functions
  • Damage under wars/ nuclear attacks
  • Contractual liabilities
  • Mechanical/ Electric failures
  • Expired/lapsed Policy
  • Ionizing radiation
  • Losses that are consequential

Add-on Covers Under Commercial Vehicle Insurance

The insurance cover of your commercial vehicle can be further increased by opting for add-ons. You would have to pay a little extra for each but the cover can increase many folds:

  • Personal Accident Cover
  • Zero Depreciation Cover
  • Towing Cover
  • Engine Protector
  • Accessory Cover
  • Legal liability Cover
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