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Commercial Vehicle Insurance
According to the report published by The Ministry of Road Transport and Highways in 2019, 449,002 accidents were reported in 2019 across the country. Out of the total number of accidents, 1,51,113 deaths were reported. With a little more maths, this comes to close to 1230 accidents and 414 accident-related deaths per day.
These accidents involve all types of vehicles including commercial ones. The damages caused to the commercial vehicle in case of an accident or any unforeseen situation can directly affect the business and cause humongous financial losses. However, this cost can be reduced with the help of commercial car insurance.
Let’s take a walk through the meaning of commercial vehicle insurance, its advantages and various other nuances.
It is a vehicle used for transporting goods or carrying passengers. Vehicle insurance that offers a financial backup to a commercial vehicle in case of an unfortunate incident is called Commercial Vehicle Insurance. It is similar to vehicle insurance for private vehicles. However, the related coverage is specific to serve the needs of a commercial vehicle and the contingencies that may occur to such vehicles.
You can buy commercial vehicle insurance online or offline. Nowadays, buying commercial vehicle insurance online is more convenient and time-saving. If you buy from insurance companies such as ACKO, buying insurance can also be lighter on your pocket.
Buying vehicle insurance becomes easier with the help of a commercial vehicle insurance calculator. It helps the potential buyer to adjust certain factors that affect the commercial vehicle insurance cost and know the approximate amount in advance. Commercial vehicle insurance provides a financial backup in case of losses caused due to the damaged commercial vehicle. Here are the key features & benefits of buying commercial vehicle insurance.
Buying a commercial vehicle insurance plan is mandatory by law in India for commercial vehicles. Failing to buy mandatory commercial vehicle insurance can invite serious penance. This is because the risk involved in driving a commercial vehicle, especially passenger-carrying vehicles like taxis, travel vehicles, etc. is extremely high.
The damage or injury caused to the third party due to a commercial vehicle can be of a higher magnitude. This attracts equal amounts of compensation that can prove to be a major financial loss for you. It can adversely affect the business as well. However, insurance provides a safety net against financial losses where third-party damage or injuries are concerned.
A commercial vehicle is one of the assets that help the vehicle owner keep the business running. Any kind of damages caused to this asset can have a negative impact on the business. In such a situation paying more money for the repair of the vehicle can be even more financially draining. Commercial insurance can help you safeguard your savings/income by paying for the repairs of the damaged vehicle.
Commercial Vehicle Insurance ensures that you remain stress-free and can continue to focus on the business. Buying commercial vehicle insurance can bring relief to you in terms of damages to the insured vehicle and/or third-party damages or injuries.
Also, read: Vehicle Scrappage Policy in India
There are multiple types of insurance products available in the market to provide coverage to various types of commercial vehicles. The owner needs to first identify the need for insurance and then proceed to buy suitable coverage.
Note that the policyholder is the first party, the insurance company is the second party, and anyone affected by the insured vehicle is the third party.
The two types of commercial car insurance policies in India are Third-party Commercial Car Insurance Policy and Comprehensive Commercial Car Insurance Policy.
Buying at least a Third-party insurance policy is mandatory in India. It covers any person that is directly or indirectly affected by the insured vehicle. Third-party vehicle insurance provides the following coverages.
1. Accidental third-party property damage
2. Accidental third-party bodily injuries
3. Death of the third party
The Comprehensive type of vehicle insurance is exhaustive in nature. It not only provides mandatory coverage but also covers the insured vehicle against damages such as fire, riots, accidents, etc. Take a look at the following to understand the coverage in detail.
1. The entire coverage offered by the Third-party liability policy.
2. Coverage against theft of the insured vehicle.
3. Cover for damage against natural calamities (floods, earthquakes) and man-made calamities (riots, vandalism, bandhs).
4. Accidental damage while driving a car.
5. Coverage for damages against fire or explosion.
This section lists the inclusions of a commercial car insurance policy. Inclusions are situations that are covered under an insurance policy. You can go ahead and raise a claim against the following situations.
1. Damages arising out of a malicious act not caused by the owner.
2. Damage due to fire, explosion, or if lightning strikes the insured vehicle.
3. The entire coverage offered by the Third-party car insurance policy.
4. Damage to the insured vehicle caused due to an accident.
5. Damage to the insured vehicle caused due to terrorist activity.
6. Damage due to man-made calamities like bandh, riots, vandalism, etc.
7. The damage occurred while the insured vehicle was being transported via water, rail, or land.
8. Damage resulting from natural calamities like earthquake, floods, hurricane, cyclone, landslide, hailstorm, frost, etc. Damage such as shock damage or fire damage due to a natural calamity is also covered.
9. Theft of the insured vehicle (burglary/breaking into a house is included in this coverage). Here, the owner is expected to submit the vehicle keys and the necessary documents.
Note: Personal Accident cover for the owner/driver is mandatory in India and needs to be bought separately along with the Third-party or Comprehensive commercial vehicle insurance policy. It covers both permanent disability/death while driving a car and the coverage will be maximum Rs. 15 lakhs during one policy period.
Exclusions are situations that are not covered under an insurance policy. Meaning, you cannot raise a claim if the insured vehicle is damaged due to the following situations.
1. Damage due to electrical or mechanical breakdown.
2. Consequential losses are not covered.
3. Damage caused when driving under the influence of alcohol.
4. Damage caused when driving without valid documents.
5. Damage caused when involved in criminal activity or breaking the law.
6. Intentional damage to the insured vehicle.
A detailed list of exclusions will be available in the commercial car insurance policy. If you are unsure about the list, you can get in touch with our support team.
The insurance bought for the purpose of covering a commercial car/taxi is known as commercial car/taxi insurance. These vehicles are usually four-wheelers that can be either simple hatchback cars, sedans, or SUVs (Sports Utility Vehicles). They are commercially owned and are used to carry paid passengers from one place to another.
Any major damage caused to the commercial car can directly put the lives of its passengers at risk. Hence, it is imperative that the owner of a commercial vehicle car spend enough time purchasing a comprehensive insurance policy with extensive coverage. The insurance policy covers a commercial car/taxi against the types of damages that are mentioned above.
The price of commercial car insurance depends on a number of factors. The owner can use a commercial vehicle insurance calculator to know the approximate commercial vehicle insurance cost. Usually, the following factors play a vital role in determining the cost of a car insurance policy.
The premium for Third-party policy is lower than the Comprehensive Policy. Usually, the wider the coverage, the higher the policy.
Deductibles are of two types - Mandatory deductibles and Voluntary deductibles. The higher the deductible amount at the time of claim settlement, the lesser the premium amount.
IDV is the approximate current market value of the car. The higher the IDV, the higher the premium amount and vice versa.
The make and model of the car and the year of manufacture of the commercial car also determine the premium amount of your commercial vehicle.
Third-party insurance policy rates are determined by the IRDAI based on the vehicle’s engine cubic capacity (cc). The higher the cc, the more the premium amount.
Here is the list of factors to consider before buying a commercial vehicle insurance policy.
1. Consider your requirements and compare available plans.
2. Check the quality of services offered by the insurance company.
3. Check the claim settlement ratio of the insurer.
4. Check the coverage, inclusions, exclusions, terms and conditions.
5. Use an insurance premium calculator to buy a policy that is high on benefits, but low on costs.
Here is a step-by-step process to buy commercial vehicle insurance online on ACKO.
Consider your requirements before buying a commercial vehicle insurance policy. Once done, visit www.acko.com or download the mobile app to purchase a policy.
Select ‘Commercial Use’ when prompted the purpose of driving your car. Answer a few details such as your location, your car’s make and model, variant, purchase year, previous policy details, etc.
Compare plans to gauge the scope of coverage, inclusions, exclusions and the price of the insurance plan before buying the policy.
You can also adjust the IDV to check its impact on the premium amount. Review coverage, and go through the terms and conditions of the policy.
Make a payment and get the policy instantly into your inbox! No paperwork or form-filling required!
It is crucial to renew the vehicle insurance policy before the expiry to ensure continued coverage. It will help in complying with the law as well.
To renew your policy, all you have to do is log in to your account, choose the policy, make the payment and that’s it. Your commercial vehicle is now insured!
To raise a claim against commercial car insurance, you need to first get in touch with your insurance company, which in this case is ACKO.
Each insurer has slight variations when it comes to their claim process. To raise a claim, you can get in touch with us via call, email, or by raising a claim on our website/mobile app.
A claim for commercial vehicle insurance can be of the following two types - Cashless Claim or Reimbursement Claim.
The vehicle is repaired at a network garage under a cashless claim. In this case, the network garage and ACKO will settle the repair bill among themselves and you just need to pay the deductibles. This is a hassle-free claim process where you do not have to worry about arranging a large sum of money for getting the vehicle repaired.
A reimbursement claim can be raised after you settle the repair bills with a garage of your choice. Here, you will first pay the entire repair amount to the garage and then apply for a reimbursement claim. In this case, it requires you to arrange money for the repairs of the damaged vehicle.
You might require the following set of documents while making a claim with the insurance company.
1. The commercial insurance policy
2. Duly filled claim form
3. Fitness certificate of the vehicle
4. Driving license of the driver of the vehicle
5. Registration certificate of the vehicle
6. First Information Report (FIR) wherever required
The following are the advantages of buying commercial vehicle insurance on ACKO.
Being a digital-first insurance company has allowed ACKO to eliminate costs and commissions related to middlemen or agents. This benefit is directly passed on to you while buying insurance.
Raising a claim is easy with ACKO. Just login to your account and raise claims anytime and from anywhere. With this, our efficient claim settlement team ensures that your claim settlement journey is smooth, quick and hassle-free.
Any queries related to buying a policy, choosing an insurance cover, or making a claim, will be addressed by an insurance expert who will provide the best possible solution all along the way.
Passenger Carrying Vehicles (PCV) are usually Light Commercial Vehicles, for example, auto-rickshaw, car, cab, taxi, school bus, etc. However, heavy vehicles like buses or coaches also come under PCV.
Goods carrying vehicles can be of any type from Heavy Commercial Vehicles (HCVs), Medium Commercial Vehicles (MCVs), or Light Commercial Vehicles (LCVs). Mostly, many goods are carried in vehicles like trucks, tempos, or lorries.
A car insurance policy that protects a commercial car against financial liabilities is called commercial car insurance. It can be one of the following two types – Third-party liability insurance or Comprehensive insurance.What is the difference between commercial and personal insurance?
Commercial insurance provides insurance coverage to commercial vehicles that transport goods or passengers. On the other hand, a personal insurance policy is issued to private vehicles that a person owns for personal travel purposes.Why would I need commercial vehicle insurance?
Commercial vehicle insurance provides coverage against various contingencies like damage to the third-party property or damage to the insured vehicle, etc. It can help the vehicle owner to carry out quick repairs and help the business run. Also, it is mandatory by law to buy a Third-party insurance policy while driving your vehicle in India.How do you insure a commercial vehicle?
One can insure a commercial vehicle either by visiting ACKO’s website or downloading the app. The entire process can be completed in under 5 minutes if all goes well.How are insurance premiums calculated for a commercial vehicle?
The insurance premium is calculated based on various factors like IDV of the vehicle, claim history of the vehicle owner, manufacturing year, make and model, etc.What is IDV in my Commercial Vehicle Insurance policy?
IDV refers to the Insured Declared Value. It is the approximate current market value of the vehicle. The car owner needs to declare this amount while buying a comprehensive insurance policy. IDV is also an important factor in determining the commercial vehicle insurance cost.
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