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Old 27th November 2008, 11:48   #1
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Default Automobile Insurance Queries? Ask me

AUTOMOBILE INSURANCE: FREQUENTLY ASKED QUESTIONS



Dear Team BHPians,

These are some of the FAQ which have been created by (me) Mr. Rupesh Vora - rjvora_2000 and Mr. Imran Jeddy - bblost.

Thank you for your support the entire T-Bhp Moderator team.


Q. What are the quick points that I need to check in my Vehicle Insurance Policy?
A. All the information must match with your details in RC book including CC, make model, sub type, fuel type, seating capacity (very important) etc.

Q. What are the points that I need to check in the renewal notice?
A. IDV is reduced by a minimum of 10% from last year,
Vehicle Registration No. is correct;
Premium is less than the last year (If you have not made any claim.)
NCB (If applicable) is more than last year’s NCB. (Maximum 50%)
Sometimes the Third Party insurance premium may get revised. This is very rare and it may cause the premium to go up.

Q: What are the factors that one should consider before selecting an insurance company?
A: Ideally the company that has a cashless tie-up with the widest network of service stations that you may visit in case of an accident. Secondly, the company which offers you the best rate without any excess on it. Above all, choose a company that has a good and fastest claim settling ratio and record.

Q. Why two insurance company’s premiums are not same?
A. All the companies offer 1. Different discounts, 2. Different P.A. cover and 3. Different IDV. It is the reason of difference in premium amounts for all the insurance companies.
1. Different discount: - This mainly depends upon the claims experience of a particular company. If claims experience is good then they will offer higher discount and if claims experience is bad then less discounts are offered.
2. PA (Personal Accident): - PA cover premium will not differ from company to company but it is an optional cover you need to choose the amount how much you want to cover. Eg. One company will offer Rs. 100 as a premium and other company will offer Rs. 250 as a premium.
3. IDV: - Major factor influencing will be IDV. But be very careful, many companies reduce IDV a lot, reduced IDV means your premium will be reduced. Most important point here is at the time of claim insurance company will also have to pay less for your vehicle. (It should be reduced every year by 10% minimum to 20% maximum.)
Always keep your IDV on higher side, it helps
1) During claims.
2) At the time of selling car.

Q. What is NCB and how is it calculated?
A: If you don’t make any insurance claim on your vehicle then you are eligible for a No Claim Bonus (NCB). This is a discount on your premium for the coming year and is calculates as under: -

1st year – 0% in Own Damage premium amount
2nd year – 20% in Own Damage premium amount
3rd year – 25% in Own Damage premium amount
4th year – 35% in Own Damage premium amount
5th year – 45% in Own Damage premium amount
6th year – 50% in Own Damage premium amount

Q. How is depreciation on the metal parts calculated?
A. Depreciation on metal parts is calculated as under: -
0 to 6th months – 0%
7th month to 1st year – 5%
1st year to 2nd year – 10%
2nd year to 3rd year – 15%
3rd year to 4th year – 25%
4th year to 5th year – 35%
5th year to 10th year – 40%
More than 10 year – 50%

Q. What is Excess? Is Excess good or bad?
A. Excess means the amount that will be deducted by the insurance company before making the payment to insured. There are two types of excesses. First one is compulsory which depends upon the C.C. (cubic capacity) of the vehicle and which cannot be removed from insurance policy. The second is a voluntary excess, which is given to you for reducing the premium in the policy. This is not a recommended option to avail, since it reduces the insurance claim payout if its needed. Never agree for higher excess.

Q. What is covered under own car damage?
A. Vehicle replacement cost or Vehicle repairing cost is paid if you have opted for this cover in your policy.

Q. When should a vehicle be scrapped (Under total loss)?
A. In case of an accident where the repair cost is more than 75% of car value (IDV), then insurance company will scrap the vehicle and pay the insurer the entire value of the vehicle.

Q. When do insurance companies not pay the full IDV?
A. If you have not reduced the car value every year minimum by 10% from last year’s IDV, then your insurance company will not pay the IDV. If you have increased the car value without any valid reason than also insurance company will not pay the entire IDV.

Q. What is covered under third party insurance?
A. In case of an accident, third party property damage and third party life damage is compensated.

Q. If third party vehicle is smashed beyond repair what is my liability?
A. Nothing. If you have valid insurance documents then entire loss is paid by insurance company and you don’t have to spend a single penny from your pocket.

Q. Is the dispute between the insurance company and others, Am I a party to the dispute?
A. No. once you handover the court case and papers to insurance company then they take over the case. You may however need to go once to court.

Q. If the fault is completely mine and I also agree to same, does my liability change?
A. No, not at all. The premium you pay covers for potential mistakes on your side.

Q. Is the dispute between the insurance company and others, Am I a party to the dispute?
A. No. once you handover the court case and papers to insurance company then they take over the case and you don’t have to visit court or to do anything.

Q. In case of physical injury or death of passengers in my vehicle, are the medical expenses covered? Is there a special type of insurance cover?
A. Under third party cover there is a clause called Unnamed Passenger PA (personal accident) cover. If you have opted for this cover (which is available on extra premium of maximum Rs. 100/- per person for a coverage of Rs. 2,00,000/-) then there is compensation payable to the family members in case of death. There is no cost of medical bills or any expenses payable to the injured passengers. Currently there are no options (products) for getting this covered through vehicle insurance.

Q. Are third party medical expenses covered? Is there a special type of insurance cover?
A. Yes. The entire expenses are paid under TP(Third Party) policy, if there is a police case, you don’t have to opt for any special policy. Unlimited medical expenses are paid under TP policy.

Q. In case of theft, how much will the insurance companies pay?
A. Entire IDV minus excess is paid.

Q. What is the reason for not paying the entire IDV under insurance policy, if vehicle is stolen?
A. If you have not reduced the car value every year minimum by 10% from last year’s IDV, then your insurance company will not pay the IDV. If you have increased the car value without any valid reason, then also insurance company will not pay the entire IDV.

Q. Do I lose my NCB in case of theft of my car?
A. Yes. If there is a theft and you make a claim, you lose the NCB.

Q. How much time does it take to settle my claim, under theft insurance?
A. There are lots of documents which have to be submitted in case of theft insurance. (Approximately number = 18). Post submission of all those documents, you will be required to submit a "Final Investigation Report (FIR)". This is usually issued by/from police station after approx 3 months of the theft. The claim is paid one month after the submission of the FIR.

Q. My Insurance has expired yesterday is there a grace period after last date for renewal without inspection/penalty
A. There is no grace period in comprehensive insurance. The NCB savings will elapse after 3 months.

Q. Can I renew my insurance without an inspection?
A. For third party it does not matter. But it’s mandatory for comprehensive insurance.

Q. Can NCB be transferred if I change my insurance company?
A. Yes. Your car carries the NCB; every company has to accept it.

Q. What is the procedure to transfer my existing NCB to new car insurance?
A. When you sell your car, you have to submit Form 29 & 30 to insurance company, which has information about buyer and seller including their signatures. This verifies that you have sold your car. Company then issues a No Claim Bonus Certificate which can be used on your new car.

Q. Can this be still done if I wish to retain my old car?
A. NO

Q. Is an FIR required when I make a claim for a repair? (Given there are not legal issue with the damage)
A. It depends on a case to case basis. If a tree fell on the car and destroyed it, you can get full IDV back without an FIR.

Please post your questions in https://www.team-bhp.com/forum/india...ce-ask-me.html

Last edited by GTO : 30th October 2015 at 09:48. Reason: Adding FAQ
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Old 27th November 2008, 11:58   #2
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I made several claims with TATA AIG and was not requested to get a Police case in any of the instances. Police Case is mandatory if there is any harm to any passenger.
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Old 28th November 2008, 15:19   #3
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Last year i switched from National Insurance to Reliance after association of more than a decade. Now i want to change to some other company please advice on the same though experience with Reliance is fine but need a better one
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Old 29th November 2008, 08:37   #4
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Quote:
Originally Posted by metropolis View Post
Last year i switched from National Insurance to Reliance after association of more than a decade. Now i want to change to some other company please advice on the same though experience with Reliance is fine but need a better one
Switch to any pvt. insurance company all I would rate better then government company.
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Old 29th November 2008, 11:15   #5
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Quote:
Originally Posted by rjvora_2000 View Post
Hello every one,

Since long time (May be a month) I was thinking to start this trend. Finally hear I am replying to all your insurance query and claim information.

Yesterday one of my friend gave me a call and he had a accident in Mumbai. It was his mistake he told me on the first instance. Other person had a TP insurance policy from Royal Sundram and he was stressing on the police complain. My friend told him that you claim from your insurance company what ever is not paid from insurance company he will pay it (because it was his mistake) He was saying he will not get the claim if he does not register the police complain.
One can claim damages to one's own vehicle only if the insurance policy is comprehensive.

One can claim damages from other party's insurance only if the mistake is proven to be of other party.

In your friend's case, other party does not have a comprehensive insurance, hence he is trying to claim the damages from your friend's insurance policy.

To do the above, following must happen

- Complaint needs to be registered in police station
- RTO inspection needs to take place.
- Till RTO inspection is completed, vehicles stay in police station
- After RTO inspection, one can take possession of vehicle.
- After that, affected party has to go to court and claim the money

Usually I would recommend that your friend goes through above procedure. By doing so, he would avoid paying from his own pocket. This is assuming that your friend has valid DL, Insurance and proper registration of the vehicle. Yes, there would be nuisance dealing with cops and some time would be wasted. Some people prefer to pay from their pocket because their time is worth more than what they have to pay.

Disclaimer: I don't work for insurance. I know the above only via personal experience.
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Old 29th November 2008, 13:37   #6
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Quote:
Originally Posted by hondadude View Post
One can claim damages to one's own vehicle only if the insurance policy is comprehensive.

One can claim damages from other party's insurance only if the mistake is proven to be of other party.

In your friend's case, other party does not have a comprehensive insurance, hence he is trying to claim the damages from your friend's insurance policy.

To do the above, following must happen

- Complaint needs to be registered in police station
- RTO inspection needs to take place.
- Till RTO inspection is completed, vehicles stay in police station
- After RTO inspection, one can take possession of vehicle.
- After that, affected party has to go to court and claim the money

Usually I would recommend that your friend goes through above procedure. By doing so, he would avoid paying from his own pocket. This is assuming that your friend has valid DL, Insurance and proper registration of the vehicle. Yes, there would be nuisance dealing with cops and some time would be wasted. Some people prefer to pay from their pocket because their time is worth more than what they have to pay.

Disclaimer: I don't work for insurance. I know the above only via personal experience.
Wow this was new input for me also. But still I will get it conformed from insurance company in some time and then get back to this trend again.
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Old 1st December 2008, 10:40   #7
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Quote:
Originally Posted by hondadude View Post
One can claim damages from other party's insurance only if the mistake is proven to be of other party.
I have checked with two insurance company they both had a same reply.

Claim of the other car in not payable.

If you want to take the benefit of insurance Own damage you have to take the comprehensive insurance. If you have TP insurance then the claim is simply not payable of any kind of damage to the car.

TP mean only third party property (Other then car) and life.

Cholamandalam I meat with one branch manager.
Bajaj I had talk to claim's surveyor.
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Old 1st December 2008, 20:28   #8
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Quote:
Originally Posted by metropolis View Post
Last year i switched from National Insurance to Reliance after association of more than a decade. Now i want to change to some other company please advice on the same though experience with Reliance is fine but need a better one
My first choice will be TATA AIG; next one will be BAJAJ ALLIANZ. These 2 companies are very good in claim settlement.
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Old 2nd December 2008, 08:52   #9
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Quote:
Originally Posted by Rohini View Post
My first choice will be TATA AIG; next one will be BAJAJ ALLIANZ. These 2 companies are very good in claim settlement.
No doubt these two are good insurance companies. Insurance claim settlement is a personalized matter so every one will have different experience.
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Old 15th December 2008, 11:51   #10
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The biggest change of the motor insurance is coming from this January - 09.

Automobile Insurance Queries? Ask me-ccf15122008_00000.jpg

This not the only company who is doing this, all the company will have this changes in there policy.
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Old 15th December 2008, 18:19   #11
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One more article on the change coming...

Source: - Premium - A magazine for insurance sales professionals (December 2008) Premium - Home Page


CCF15122008_00004.pdf

CCF15122008_00005.pdf
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Old 17th December 2008, 11:04   #12
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Default Get discount

When you buy new car's insurance ask for discount's in premium.

Ask for full PA premium this will cost you little high premium but you will get more coverage.
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Old 22nd December 2008, 11:43   #13
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Default New Information.

Hi guy's this was for your information - "Gross premium collected by non-life insurers within india of motor" (April to September 2008)

Source IRDA web site.

1. Royal - 235.37
2. Tata - 119.48
3. Reliance - 538.76
4. Iffco - 333.58
5. Icici - 643.77
6. Bajaj - 816.21
7. Hdfc - 67.40
8. Chola - 159.21
9. Future - 29.04
10. Universal - 0.01
11. Shriram - 6.88
12. Bharti - 0.24


13. New India - 963.70
14. National - 1068.89
15. United - 740.82
16. Oriental - 736.61

Rs. in Crores

Last edited by rjvora_2000 : 22nd December 2008 at 11:45.
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Old 25th December 2008, 10:17   #14
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I had a chat with the BDM (Busniess Development Manager) - Chola and BM (Branch Manager) - Bajaj regarding the change which is coming in motor insurance and they said the premium will go down as discount will still increase and the policy wording will also change. which means every company will offer some thing new to client.

This will be too compitive for insurance companies and for us also because all the companies will offer some thing new.
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Old 29th December 2008, 14:23   #15
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Hi rjvora,

A insurance renewal question.

Details: Fiesta 1.4TDCi ZXi, insured from 9th Jan '08 to 8th Jan '09, with a premium payout of Rs21979/-. The year of MFG is late 2007, even though delivery was taken in Jan '08.

Its time to renew and what all discounts should I ask for. The current insurer is Bajaj Allianz. I went through a few threads but its kind of confusing.
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