Understand Insurance.
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Simple English explanations of common insurance terms, motor insurance covers, add-ons and personal protection options. We keep the language clear so you can understand what a cover does before you choose it.
Motor Insurance Basics
Start with the basic structure, then understand how additional covers can strengthen a policy.
Third-Party Insurance
Third-party motor insurance covers certain legal liabilities arising from injury or property damage caused to a third party, subject to the policy and applicable law. Third-party liability insurance is mandatory for vehicles used on public roads in India.
When we use a vehicle on the road, our vehicle can cause loss or injury to another person. Third-party insurance provides a financial protection mechanism for eligible third-party liabilities.
Comprehensive Motor Insurance
A comprehensive policy generally combines third-party liability cover with own-damage protection for the insured vehicle, subject to the policy terms, exclusions and deductibles.
- Third-party liability protection
- Own-damage protection for covered events
- Optional add-ons may be available
- Exact coverage depends on the policy schedule and wording
1. What Is Third-Party Insurance?
Third-party insurance is the basic liability protection for a motor vehicle. It is designed to cover eligible legal liability towards a third party when the insured vehicle causes covered injury, death or property damage, subject to the policy terms and applicable law.
Why do we need it?
Driving on public roads comes with responsibility. If a vehicle causes harm to another person or their property, there may be a legal and financial liability. Third-party insurance helps provide protection against covered third-party liabilities.
2. What Is Comprehensive Motor Insurance?
A comprehensive motor policy generally provides third-party liability cover along with own-damage protection for the insured vehicle. The own-damage part can respond to covered losses such as accident, theft, fire or natural events, depending on the policy wording.
Can add-ons make it stronger?
Yes. Add-ons can extend or modify the protection provided by the base policy. Different insurers offer different add-ons, and availability, limits, exclusions and conditions can vary.
3. What Is TPPD?
TPPD means Third-Party Property Damage. It relates to covered property damage caused to a third party, subject to the applicable policy terms and limits.
What is TPPD restriction?
Some policies may offer a lower/restricted TPPD limit in exchange for a lower premium. A customer should understand the effect of that restriction before choosing it.
4. Motor Insurance Add-ons
Add-ons are optional covers that can extend the base policy for an additional premium. Not every add-on is available with every insurer, vehicle or policy.
Helps reduce the impact of depreciation deductions on eligible parts in an own-damage claim, subject to the add-on's conditions, exclusions and limits.
May cover eligible consumable items used during an insured repair, such as certain oils, lubricants, nuts, bolts or similar items, subject to policy terms.
Provides additional protection for eligible engine-related losses that may not be covered under the standard own-damage section, subject to specific conditions and exclusions.
In eligible total-loss, constructive-total-loss or theft situations, this add-on may bridge the gap between the standard settlement basis and the amount defined by the add-on, subject to its terms.
Helps cover eligible expenses related to replacement of lost, stolen or damaged keys/locks, subject to limits and conditions.
Can provide services such as breakdown assistance, towing or other roadside support, depending on the insurer's RSA package.
May provide cover for eligible accidental damage to tyres and/or alloy wheels beyond the standard policy, subject to the add-on wording.
May help protect the No Claim Bonus after an eligible claim, subject to the conditions of the add-on. NCB itself is linked to the insured person, not the vehicle.
May cover eligible loss or damage to specified personal belongings kept in the vehicle, subject to limits, exclusions and proof requirements.
Insurers may offer additional covers for different vehicle types and customer needs. Availability and wording must be checked before purchase.
5. Personal Accident & Liability Covers
Motor insurance can also include or offer separate protection for people connected with the vehicle. The exact cover, eligibility and limits depend on the policy and applicable rules.
Personal Accident Cover for Owner-Driver
This is designed to provide personal accident protection for an eligible owner-driver, subject to the policy terms and applicable regulatory requirements.
Personal Accident Cover for Passengers
An optional passenger personal accident cover may be available for eligible occupants, depending on the vehicle and policy.
Legal Liability for Paid Driver / Employee
Where applicable, a policy may provide legal liability cover for eligible paid drivers or employees, subject to the policy wording and statutory requirements.
Why should you understand these covers?
The vehicle itself is not the only thing that matters. The people using or travelling in the vehicle can also have protection needs. The right combination depends on the vehicle type, usage and policy requirements.
6. Which Covers May Be Useful for You?
There is no single add-on combination that is right for every customer. A private car, commercial taxi, T-permit vehicle, bike and goods carrying vehicle can have different risks and insurance requirements.
- Private car: customers may consider own-damage protection and selected add-ons based on vehicle age, usage and budget.
- Commercial car / taxi: usage, passenger exposure and downtime can make the right liability and assistance covers especially important to review.
- Two-wheeler: customers should review third-party liability, own-damage protection where required and relevant add-ons offered for the vehicle.
- Goods carrying vehicle: vehicle usage, commercial operations and driver-related liabilities should be reviewed carefully.
7. Common Motor Insurance Terms
IDV — Insured Declared Value
IDV is the value used for the insured vehicle for relevant own-damage/theft settlement purposes, subject to the policy terms. It is not simply the current showroom price of the vehicle.
NCB — No Claim Bonus
NCB is a benefit for eligible claim-free periods. IRDAI explains that NCB applies to the own-damage premium, not the liability premium, and can be carried when changing insurers subject to the required proof and rules.
Deductible
A deductible is the portion of a claim that the policyholder has to bear as specified by the policy. The applicable deductible should be checked before buying or making a claim.
8. Car Insurance Renewal — Why Is It Important?
Keeping motor insurance active helps maintain required third-party liability protection and, where applicable, own-damage protection. Renew before expiry so there is no avoidable break in coverage. Your renewal terms, NCB, inspection requirements and available add-ons can depend on the insurer and policy history.
9. Commercial Motor Insurance
Commercial vehicles can include taxis, permit cars, goods carrying vehicles and other vehicles used for business purposes. The correct policy depends on the vehicle class, registration, permit, use and insurer eligibility.
For Ola/Uber or other passenger-carrying vehicles, T-permit/taxi usage should be disclosed correctly. For goods carriers, the vehicle's commercial use and category should also be declared correctly.
Health Insurance Basics
A simple introduction to why health insurance can matter for you and your family.
What Is Health Insurance?
Health insurance can help manage eligible medical and hospitalisation expenses according to the policy terms. It can reduce the financial impact of unexpected medical treatment.
What Should You Check?
Before choosing a plan, understand the sum insured, waiting periods, exclusions, room-rent or other limits, network hospitals, co-pay and claim conditions. The exact benefits depend on the policy.
Tell us your requirement and we can guide you through the available options.
Term Life Insurance Basics
A simple introduction to term insurance and its purpose.
What Is Term Insurance?
Term insurance is a life insurance product that provides a death benefit to the nominee if the insured dies during the policy term, subject to the policy terms.
Why Consider It?
It is mainly used to create financial protection for dependants. When choosing a plan, consider your income, loans, family responsibilities, policy term, cover amount and the policy conditions.
We can help you understand the basic options before you decide.
Common Questions
Short answers to questions customers often ask before buying motor insurance.
Is third-party motor insurance mandatory?
Third-party liability insurance is mandatory for vehicles used on public roads in India. The exact legal requirements and applicable exceptions should be checked under current law and policy terms.
Is comprehensive insurance mandatory?
Third-party liability cover is the mandatory part. Own-damage/comprehensive protection is a separate coverage choice, subject to the applicable product and vehicle eligibility.
Do I need every motor insurance add-on?
No. Add-ons are optional and their usefulness depends on your vehicle, usage, age, risk and budget. Availability also differs between insurers.
Can I restrict TPPD to save premium?
Some policy structures may allow a restricted TPPD limit. Understand the reduction in protection before choosing it, rather than looking only at the premium saving.
Does every insurer offer the same add-ons?
No. IRDAI notes that different insurers offer different add-ons. Always check the insurer's current policy wording and add-on terms.
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