Blogs

  • If repair cost is too high, can insurance company ask you for higher copay?

     

    A motor insurance policy is a mandatory insurance cover which your vehicle is required to have if you plan on using it on Indian roads. The Motor Vehicles Act, 1988 mandates a motor insurance policy on every type of motor vehicle. That is why, like it or not, you are supposed to buy and renew your motor insurance policy every year so that your vehicle has a continuous cover.

    There are two types of motor insurance policies. One is the mandatory legal liability cover which protects you financially if your vehicle harms a third party or property and you become liable for the damages. The second is a comprehensive motor insurance policy which covers legal liability as well as any damages faced by you or your vehicle. A comprehensive policy is more effective as it pays for the repair costs when your vehicle suffers any damage.

  • What is the schedule of depreciation on different items?

     

    The true purpose of having a comprehensive motor insurance policy is felt without a doubt when your vehicle suffers damages and you make a motor insurance claim. When the insurance company pays the cost of repairs which, otherwise, had been your headache, you feel a sense of calm and relief. But your calm and relief is short-lived when the repair costs are not paid in full. The insurance company makes some deductions in the total repair bills and then the claim is settled. Have you wondered why such deductions are made?

    Deductions from your motor insurance claim are done, mainly, for two reasons. One is the portion of compulsory deductible which represents the mandatory amount of claim paid out of your pockets. The other is the depreciation on your vehicle's parts which have been repaired. This rate of depreciation is different for different parts of the vehicle. Do you know this schedule of depreciation? No? Let's find out :