In India, if you own a vehicle we’re sure you know that you need insurance. According to the Motor Vehicles Act, 1988, you are required to mandatorily have a third-party insurance to legally use your vehicle on the road. But, understanding what kind of policy you need can be a little bit confusing. Depending on how you intend to use your vehicle, you will have to decide on whether you need to purchase private car insurance or commercial car insurance.
Private Car Insurance
If you use the car solely for yourself and your family members, a private car insurance policy should suffice. While you do have the ability to cruise around with just third-party cover, it’s always best to boost your protection with personal accident cover as well. With this additional cover, your insurance policy will also help take care of you in case you were to suffer any injuries in an accident.
Commercial Car Insurance
If you’re using the car with the sole intention of ferrying employees from one place to another or to move your goods around, you’d be better served with commercial car insurance policy. There are two reasons for this. Firstly, your private car insurance claim may not be valid if you’re using your vehicle for a commercial purpose. Secondly, and more importantly, the cover you’re offered on a commercial car insurance policy tends to be higher than private car insurance policy. This means that your insurance settlements should help make up for any damage to your goods or losses you may suffer.
Of course, the cover you’re offered on your commercial car will depend greatly on whether you’ve decided to get just third-party insurance or if you’ve also included personal accident cover. If you’re moving goods around, personal accident cover for just the driver should suffice. But, if you’re using the car to help your employees travel around the city, you should seriously consider getting personal accident cover for all individuals who are boarded in the vehicle. Additionally, if you use the vehicle to cross borders, you can amp up your protection by choosing to extend the geographical area of the coverage.
As you can clearly see, the way you intend to use your vehicle will determine what kind of insurance coverage you need. A private car insurance policy will do if you’re using the car for your own personal journeys. But, if you’re a business owner and your car is being used to help with your business, it’s much safer to opt for commercial car insurance policy.