In India, it is mandatory for all vehicles to have at least the coverage of third-party insurance. This liability insurance is essential not just for privately owned cars but for commercial vehicles too. Now, if you have recently got a vehicle for commercial use, you might have a couple of queries about commercial vehicle insurance. Don’t worry, for you have come to the right place. This article lists out a few frequently asked questions on commercial vehicle insurance and has them correctly answered just for you!
- What does a commercial vehicle insurance policy cover?
A third-party commercial vehicle insurance policy covers you against any financial loss and legal liability towards a third-party in an accident. A comprehensive commercial vehicle insurance policy will generally cover you for third-party losses, own damages, theft, losses due to natural and man-made calamities and injury/death suffered by the driver.
- What types of commercial vehicles can be covered?
Commercial vehicle insurance policies cover a range of vehicles used for commercial purposes such as:
- Passenger vehicles like school buses, rickshaws, and taxis
- Goods-carrying vehicles such as tempos and large trucks
- Vehicles for other commercial purposes like construction (such as cranes) or farm work (such as tractors)
- What factors determine the cost of the commercial vehicle insurance premium?
There are several factors that determine the exact cost of the premium you pay for your commercial vehicle insurance. Some of the main ones are the make and model of your vehicle, nature of commercial use, city of purchase, and type of coverage (whether liability-only or comprehensive). Your insurer may also note whether you have made any prior claims and accordingly award you the no-claims bonus which can lower your premium.
- Are there any exclusions to coverage?
Yes, commercial vehicle insurance policies may reject your claim if you were found to have been intoxicated at the time of the accident. Your claim may also get rejected if you were plying your vehicle without a valid driving licence or using it for criminal activity. The exact detail and list of exclusions will differ between insurers; do ask your insurance company for a detailed list of what the policy will not cover.
- Do commercial vehicle insurance policies also have add-ons?
Yes, you can opt in for add-ons to enhance your coverage when you buy comprehensive commercial vehicle insurance. Some of the most popular add-ons are NCB protector, invoice protection, zero depreciation, accessories cover, and consumables cover.
- Can the no-claims bonus in commercial vehicle insurance be transferred to a new vehicle?
The answer is yes because this bonus is awarded to the policyholder and not to the insured vehicle. So, if you switch over to a new vehicle, you can claim the NCB on your new premium. This is a huge plus point as the NCB can go up to 50% of the premium value.
We hope these answers have helped clear out any doubts you may have had on commercial vehicle insurance. Do read the policy papers carefully and clear out any specific questions you may have with the insurer before paying for your coverage.