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Wednesday, 16 March 2022

What Is A Package Motor Insurance Cover And How To Get One?



A package coverage is a type of insurance that, in addition to protecting third-party liabilities, also protects the insured against damages to their own vehicle, such as fire, vandalism, acts of God, natural disasters, and so on. A package cover is more expensive than a standard third-party (TP) policy since it provides more coverage.

In the event of an accident, basic third-party insurance protects the vehicle owner from any liability that may arise if a third-party is hurt or killed. Third-party insurance is required by law for driving on Indian roadways, thus most people purchase it to meet regulatory obligations. A package motor insurance policy, on the other hand, covers damages to one's own car as well as third-party damages and liabilities.

Premiums for automobile insurance are influenced by a number of factors.

The cost of package insurance is influenced by a number of things. The following are important considerations:

  • The vehicle's make and model
  • Vehicle year of manufacture
  • Optional add-ons
  • Profile of the client
  • The city of customs
Motorists can select the appropriate coverage for their car. The Insurance Regulatory and Development Authority of India regulates premiums for solely TP coverage (IRDAI).

What Makes a Bundled Auto Insurance Policy So Appealing?

Extensive coverage: Depending on the policy type, package motor insurance protects the insured's own car as well as personal injury to themselves and passengers. A package policy, for example, will cover damages caused by rain or natural catastrophes such as floods and earthquakes. If the car owner only has third-party coverage, they will be responsible for any costs incurred as a result of such events.

Value for money: Car owners may relax because they won't have to worry about high repair costs. In fact, if customers select for add-ons like depreciation coverage and consumables, the only thing they'll have to pay for is the voluntary excess (if applicable) and mandatory deductibles throughout the claim period. The depreciation, in addition to the deductible, would be charged out of pocket unless the insured has chosen a zero depreciation policy.

Relevant Add-ons: Unlike third-party auto insurance, which only provides restricted coverage for the applicant's vehicle, package insurance provides additional coverage alternatives. At a little additional cost, add-on covers such as zero depreciation, roadside assistance, engine protection, and passenger cover, among others, can be applied.

IDV (Insured's Declared Value) can be customized. IDV is the current market value of your car. While a lower IDV may result in a reduced premium, it also means less coverage in the event of theft or loss of the vehicle. New-age insurers provide the option of tailoring the vehicle's IDV (within to stipulated limits) when purchasing insurance, and we recommend getting enough coverage.

Events that are covered under a package insurance policy

Accidental damage: If the insured or the insured's car is damaged in an accident, the damages will be covered by the package cover.

Theft of automobiles is uncommon in India. However, a few areas are prone to thefts, thus such an occurrence cannot be fully ruled out. If an insured's car is stolen and the vehicle is covered by a package motor insurance policy, the insured can file a claim.

Natural catastrophes or severe weather damage: Natural disasters such as floods, earthquakes, hurricanes, tornadoes, and other severe weather events can be covered under a package insurance policy. Those who live in disaster-prone locations would profit from purchasing one of these policies. Residents who live near the coast, for example, can insure their automobiles against damage caused by storms and floods that occur frequently during the monsoon season.

Vehicle damage as a result of civil unrest: Because of the political unrest in some parts of the country, vehicles are frequently damaged during riots or violent protests. A package policy will also cover such losses.

Fire: If you get a package insurance coverage, you can recover the cost of a car that has been destroyed by fire. Such policies pay for damages caused by garage fires, engine fires, and fires caused by mechanical failure.

What Isn't Included in a Package Motor Insurance Policy?

Even if you have a package motor coverage, certain occurrences and incidents may not be covered. For instance, if your vehicle is damaged as a result of a collision, you will not be able to file a car insurance claim. The following are some more circumstances that are not covered by the package insurance policy:

Electrical or mechanical breakdown: A mechanical or electrical breakdown is often not covered under a typical automobile policy unless the insured can prove that the damage was caused by floods.

Driving without a license: If you are caught driving without a valid driver's license, you will not be reimbursed for any damages or losses.

Drunk driving: If you are found driving while under the influence of alcohol, your package policy will not cover any losses or damages.

Tyre damage: It does not cover any loss or damage to your vehicle's tyres unless they are a direct result of a car collision.
Loss or damage caused by a nuclear weapon or war: It does not cover any loss or damage to your vehicle caused by war, mutiny, nuclear weapons, or other similar threats.

The Benefits of Purchasing a Package Insurance Policy

Covering damage to one's own vehicle: It ensures that the insured will not be responsible for any financial losses incurred as a result of the damage, regardless of its severity. The coverage, on the other hand, would not pay for the exclusions listed in the insurance paperwork.

Covering third-party damage: In the event that the insured injures another person as a result of their negligence, a package insurance policy ensures that the loss suffered by the third party is covered. Even if the insured is found to be at fault and has caused bodily or property harm to a third party, this coverage covers non-criminal liability charges.

Add-on covers: While a third-party liability policy does not provide zero depreciation or engine protection, these features can be purchased as add-on covers to ensure full protection from negative circumstances.

Filing a Claim for a Package Insurance Policy

Step 1: Notify the insurer of the claim: The insured must notify their insurer of the claim. This can be done by going to the official website or sending an email to the insurer.

Step 2: Filling out the form and submitting the documents: The insured must download and complete the claim notification form, which includes information about the insurance policy, the insured vehicle, and the owner of the insured vehicle, among other things. The insured may also be required to produce a copy of the First Information Report in cases of theft (FIR).

Step 3: Determine the extent of the damage: In this phase, you can either do a self-survey or use a digital survey. If the insured chooses self-inspection, the insurer will require you to provide photographs in order to inspect the vehicle's damages. Damages are assessed by a surveyor or a workshop partner in the absence of a self-survey facility.

Step 4:Tracking the Claim: Once the insurance has been notified and the claim form and all relevant papers have been provided, the claim will be processed. On the insurer's website or a recognized gateway, the insured can track the status of their claim.

One can also upgrade their coverage from a third-party cover to a package insurance policy during renewals. New-age Insurtech companies have simplified the process of renewing vehicle insurance. After selecting an insurer, policy, and add-ons, the procedure can begin by entering vehicle information such as make, model, variant, registration date, and previous insurance information.

Despite the wide coverage provided by a package motor policy, you may still be undecided about whether you should get a package or just a third-party policy. For a relatively new vehicle, it is more cost-effective to have package car insurance because the market value is high, and any potential damage can result in a significant financial burden.


Conclusion

Even if one does not opt for a package policy, it is crucial to remember that in the event of unforeseen car damage, the high price and any losses would be met only by the person. As a result, the expenses of any prospective repairs/fixes must be weighed against the price paid for a package insurance policy. In most circumstances, choosing a package policy is the better option because it protects the insured from most types of unanticipated incidents or damages to their car.

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