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Why do we need vehicle Insurance?

Why do we need vehicle Insurance

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Driving on the road has its pros and cons:

Pro – it takes you from point A to point B and saves a lot of time.

Con – you are more susceptible to road accidents and injuries.

We are not saying that every time you are on road, you will be at risk. All we are saying is that there many types of drivers on the road and even during your most cautious days, things could go wrong. Hence, the need to have an insurance policy. In 1988, the Indian government passed the Motor Vehicles Actwhich made it compulsory for all vehicles, both Private and Commercial, to have a motor insurance policy. Any vehicle seen on the road without a motor insurance would, therefore, be penalised. This act came into effect after much contemplation and observation, and over the years, it has also seen many amendments.

What does a Motor/Vehicle Insurance Policy cover?

A motor insurance policy is a financial contract between you and your insurance provider. The contract broadly states that it will bear the financial expenses of the vehicle in case of damage. The damage can be both man-made and natural, but there will be some terms and conditions attached to it. The primary damages that are covered by a motor insurance policy are as follows:

Loss or damage – Like mentioned earlier, while on the road you are prone to accidents. Especially on Indian roads where both rash drivers and potholes are in abundance. People don’t easily comply with traffic rules, and that adds more to the driving stress. Due to the bad roads and reckless driving, collisions and dents are also very common. But thanks to your policy, you don’t have to pay from your pocket each time.

Hospitalisation – Accidents on the road, both big or small, may lead to hospitalisation. In such scenarios, too, vehicle insurance covers your hospital expenses. A comprehensive motor insurance policy not only pay for the damages of your vehicle. But also takes care of your expenses, in case you end up in a hospital.

Third Party Liability – As per the norms set by the Motor Vehicles Act, the third-party liability insurance is a mandate in the country. This policy shields you from legal matters if you end up hurting someone while driving your car. Third Party Liability is to protect you from the financial obligation that you must bear when you injure someone or cause damages to their property.

Compensate Your Family – If the owner of the vehicle meets with an accident that leads to his/her untimely death. Then a comprehensive motor insurance policy compensates the family. The person could be the breadwinner of the family, and the family could be in financial strain. This policy aids the family with a certain amount for financial assistance.

Apart from the perks mentioned above, anyone can customise their vehicle insurance policy by including add-ons to their package. These add-ons come at a nominal price and help the insured in many ways.

Having a motor insurance is not just mandatory because of the law, but given the current environment, it has become essential. Essential for your safekeeping as well as your funds. Thanks to the digitalisation, one can browse through many options and select a policy that suits their requirements. And not just that, they can also complete the entire purchase journey from their laptops or mobile phones; without having to run for the paperwork physically.

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