Running a business requires the help of the logistic function. Among the logistic chain, transportation is an essential component to make the goods available at the place of demand from the point of supply. Motor vehicles are the most common medium of transportation.
These motor vehicles need to be safeguarded using an insurance cover. This is when a motor insurance policy comes into the picture. The Motor Vehicles Act of 1988 makes it mandatory for all vehicles registered to have an insurance cover. While private vehicles require private insurance cover, commercial vehicles have specific requirements for commercial vehicle insurance.
What is commercial motor insurance?
A commercial insurance cover protects you, the policyholder, against liabilities that might arise against third-parties due to accidents, damages to the insured vehicle against natural and man-made perils. Further, its scope includes a personal accident cover for the owner or driver too. It is also known as commercial car insurance or truck insurance since it is mostly availed for these types of vehicles.
Importance of an insurance cover for commercial vehicles
Since commercial vehicles are more frequently used than private vehicles, they are more prone to accidents and the risks arising out of it. These liabilities can be a hefty financial burden if not adequately secured using an insurance cover. Here are some reasons why it is essential to insure your commercial vehicle.
- If your commercial vehicle is involved in an accident that causes injury or damage to property of a third person, the liabilities arising out of it need to be borne by you. A commercial insurance cover safeguards your business against these liabilities.
- Road accidents can end up damaging your vehicle. The required financial assistance to repair the vehicle is provided by a commercial vehicle insurance policy.
- This policy extends its coverage to provide a safety net to the dependents of the driver and his family in case of accidental death or disability.
What types of coverage are unavailable under commercial vehicle insurance?
The following types of coverage can be obtained when you buy commercial motor insurance online or offline.
Third-party liability cover: Any liabilities that involve third-party is covered under this policy. Accident, injury and property damage can be insured when you opt for third-party commercial vehicle insurance.
Own-damage cover: Damages to the vehicle of the insured is secured under own-damage insurance component. Burglary, theft, strikes, riots, events of terrorism are the mand made perils that are insured under the own-damage component. Further, natural calamities like earthquakes, storms, floods, lightning, rockslide, hailstorm, cyclone are some examples of natural calamities that are covered by your insurance policy. Lastly, any damages caused during the transit by either road, rail, waterways, air, lift or elevator are also included in the coverage.
Personal accident cover: Every commercial insurance policy includes coverage for personal accident cover. In an event of injury or disability to the driver, this cover provides financial support.
Towing cover: Breakdown of your vehicle can leave you stranded in the middle of nowhere. Comprehensive commercial insurance with towing cover provides support in such times of distress.
The bottom line, do not forget to compare the myriad options you have at hand. A motor insurance calculator can come handy in this comparison when making the right selection for your commercial vehicles.