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8/3/2019 Motor Insurance - Copy
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MOTOR INSURANCEMOTOR INSURANCE
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WHAT IS MOTOR INSURANCE ?WHAT IS MOTOR INSURANCE ?
Motor insurance is a combination of two words
i.e.Motor + Insurance
Insurance is Protection against any Unforeseen risk.The unforeseen risk is an incident, Which cant beforeseen i.e.Which May or may not happen.
Motor insurance is also known as auto insurance, gapinsurance , car insurance, or vehicle insurance.
It purchased for cars, trucks, motorcycles, and otherroad vehicles.
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Conti..Conti..
A) it may result in to either creation of liabilities or
B) will result in to financial losses:
- Injuries/death to person/s and- Damage to property. A
(Liabilities)
- Damage to the vehicle itself and
- Theft of parts or the theft of the B
Vehicle itself.
(Financial losses)
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TYPES OF POLICIESTYPES OF POLICIES
The policy which is mandatory to Be taken in order
to meet the Required of the motor vehicle Act is,
liability only policy, as Explained earlier.
The second policy is the choice of The owner of the
vehicle i.e. He May or may not take this policy, Known
as,package policy.
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INTRODUCTIONINTRODUCTION
Globally motor insurance is the Biggest and fastest
growing General insurance portfolio and India is no
exception to it.
It accounts for more than 45% of the Total generalinsurance premium Income in India.
In the year ending 2009, total nonlife Premium of the
industry was About 28,000 crores out of which Motor
share was about 13,000 crores.
However motor business was 25 Crores only at the
time of Nationalization.
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Conti..Conti..
Some of the factors responsible For this growth
are:
Increase in earning capacity of Individual
Change in priorities of life
Explosive growth of automobile Industry
Newer models being introduced in India and in theworld, the costlier Ones and the cheapest versions and
Introduction of cheap auto loans.
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GROWTHGROWTH
In 1951, there were 3,00,000 motor
Vehicles throughout india
The road network at that time
Was of 4,00,000 kilometers
By the year ending 2004, the
Number of vehicles has gone up
By 270 times, where asRoad network has expanded by
11 times only.
11
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GROWTHGROWTH
In india the vehicle population has
Already crossed 8 crores comprising
Of the followings:
Two wheelers: 6 crores
Motor cars : 2 crores
Commercial : 2 crores and
About 90 lakh motor vehicles (allTypes) are being added on indian
Roads every year.
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ACCIDENTSACCIDENTS
About 300 persons are being killed on
Road accidents daily and about 10,00,00
Are being injured annually and
The incidence of road accidents to
Number of vehicles in india isAlarmingly high in comparison to
Developed countries:
The number of road accidents per
10,000 vehicles in india is about 120 as
Against 10 in the developed countries
Of the world
The number of deaths per 10,000
Vehicles in india is 55 as against 2 in
The west.
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ACCIDENTSACCIDENTS
In 1990, traffic accidents were worlds
Ninth biggest cause of death and it is
Expected to become the third biggest
By 2020.
Study undertaken by the worldHealth organization reveals that
Road accidents are the second and
Third biggest cause of death in the
Age group of 5-29 and 30-44 yrs.
Respectively.
The indian situation is amongst the
Worst in the world i.E.
Share of road fatalities is around 86%.
Against 40% share of vehicle population.
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IMPLICATIONSIMPLICATIONS
It is therefore natural that in
A situation like this i.E.The
Widespread use of vehicle by the
Common man
Many vehicle owners and users
May not have the requisite
Financial capabilities ofCompensation to the victims of
The road accident.
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REMEDIESREMEDIES
The motor vehicle act has
Therefore made the third party
Insurance compulsory
It a punishable offence to use theVehicle without insurance
Necessary provisions for its
Enforcement are therefore are
Available with the authorities:Failure to comply the provisions of sec.146
Of the mv act is punishable by an
Imprisonment of three months or a penalty
Of rs. 1000 or both (sec.196 of the mv act).
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HISTORYHISTORY
Motor insurance is one of the
Most important portfolios of
Insurance industry and
It is mandatory/ compulsoryInsurance for the vehicles plying
On the roads
It is worthwhile to know that
The toll taken by road accidents
Is no less than the toll of a major
Natural or a man-made
Catastrophe (like 9/11).
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HISTORYHISTORY
1894: 1st motorcar introduced in
U.K. England.
1895: 1st motor policy only third
Party liabilities introduced.1899: accidental damage to car
Added comprehensive insurance
(Package).
1903: car & general insuranceCorporation ltd. Established
Mainly to transact motor
Insurance, followed by other
Companies.
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HISTORYHISTORY
Post world war- i: increase in
Number of vehicles and road
Accidents.
Road traffic acts: 1930 & 1934 -
Compulsory third party liability
Insurance.
Road traffic act 1960: compulsoryInsurance provisions of above
Acts was consolidated.
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HISTORYHISTORY -- INDIAINDIA
1939: motor vehicles act (mva) passed.
Compulsory 3rd party insurance
Introduced on 1st july, 1946.
Practice in india follows that of
U.K. Market.
Governed by a tariff: withdrawn in
Uk.Mva 1988, replaced the mva of 1939.
Effective from july 1st 1989.
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MANDATORY INSURANCEMANDATORY INSURANCE
The mandatory part of the motor
Insurance is known as
Third party insurance
This insurance was formed on the
Basis of motor vehicle act
The policy is being issued in
Accordance with the provisionsOf the m. V. Act, is now called as
The liability only policy & the
Coverages provided are:.
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LIABALITIES TO THIRD PARTIESLIABALITIES TO THIRD PARTIES
Death of or bodily injury to any
Person including occupants
(Provided such occupants are not
Carried for hire or reward) as per
Motor vehicles act, 1988.The company shall not be liable for
Death or injury arises out of and in
The course of the employment
Damage to property other than
Property belonging to the insured orHeld in trust/ custody or control of
The insured
All costs and expenses incurred with
Its written consent.
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LIABALITIES TO THIRD PARTIESLIABALITIES TO THIRD PARTIES
Any driver who is driving the
Vehicle on the insureds order
Or with insureds permission
Provided that such driver
Shall as though he/ she was
The insured
Observes & fulfill the termsExceptions and conditions of
This policy.
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LIABALITIES TO THIRD PARTIESLIABALITIES TO THIRD PARTIES
Any person entitled to
Indemnity, the company will
Indemnify such person or his/
Her personal representative
Provided
That such personal
Representative shall as thoughWas the insured, observe fulfill
The terms exceptions and
Conditions of this policy.
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PERSONAL ACCIDENT COVER FORPERSONAL ACCIDENT COVER FOR
OWNEROWNER -- DRIVERDRIVER
The company undertakes to pay
Compensation as per the
Following scale for bodily
Injury/ death sustained by the
Owner-driver of the vehicle
In direct connection with the
Vehicle insured or whilst:
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PERSONAL ACCIDENT COVER FORPERSONAL ACCIDENT COVER FOR
OWNEROWNER -- DRIVERDRIVER
Driving
Mounting into/ dismounting from
The vehicle insured
Whilst traveling in it as a co-driver
Caused by violent, accidental,
External and visible means
Which is independent of any otherCause
Shall within six calendar months of
Such injury result in:
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SCALE OF COMPENSATIONSCALE OF COMPENSATION
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LIMITATIONSLIMITATIONS
Provided always that
Compensation shall be payable under
Only one of the items (1) to (4) above in
Respect of the:
Owner-driver arising out of any one
Occurrence and
The total liability of the insurer shall
Not in the aggregate exceed the sum of
Rs. 2 lack during:Any one period of insurance.
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EXCLUSIONSEXCLUSIONS
No compensation shall be payable in
Respect of death or bodily injury directly
Or indirectly wholly or in part arising or
Resulting from or traceable to:
Intentional self injury suicide or attemptedSuicide physical defect or infirmity or
An accident happening whilst such person
Is under the influence of intoxicating
Liquor or drugs.
Such compensation shall be payable
Directly to the insured or to their legal
Representatives.
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LIMITATIONSLIMITATIONS
This cover is subject to:
The owner-driver is the registered
Owner of the vehicle insured
The owner-driver is the insured
Named in this policy
The owner-driver holds an
Effective driving license
In accordance with the provisions of
Rule 3 of the central motor vehiclesRules 1989, at the time of the accident.
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LIMITS OF LIABILITIESLIMITS OF LIABILITIES
Under section - ii of the policy:
Death of or bodily injury - such
Amount as is necessary to meet
The requirements of the motor
Vehicles act, 1988.Unlimited.
Under section - ii of the policy:
Damage to third party property:
Rs.6,000 / rs.7, 50,000 as the case may be.
P.A. Cover under section iii:
For owner-driver (csi):
Rs.2,00,000.
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TYPES OF VEHICLESTYPES OF VEHICLES
The indian motor tariff revised w.E.F.
1st july 2002, for the purposes of
Insurance
Has classified the motor vehiclesBroadly into three categories with
Further sub classification viz.
Private cars
Motorized two wheelers andCommercial vehicles.
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CONDITIONSCONDITIONS
Notice shall be given in writing Immediately for any accidental loss or
Damage to the vehicle
Notice shall be given in writing
Immediately of any writ/ summons along
With copy of any prosecution inquest or
Fatal inquiry
No admission, offer, promise, payment
Without the written consent
In case of theft, immediately inform the
Police
No admission, offer, promise, payment,
Shall be made without the written
Consent of the company..
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CONDITIONSCONDITIONS
The insured shall take all
Reasonable steps to safeguard
The vehicle from loss or damage
And to maintain it in efficient
Condition:Company shall have free and full
Access to examine the vehicle or
Any part thereof or
Any driver or employee of theInsured.
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CONDITIONSCONDITIONS
In the event of any accident or
Breakdown, the vehicle shall
Not be left unattended without
Proper precautions:
To prevent further damage or lossIf the vehicle be driven before the
Necessary repairs
Any extension of the damage or
Further damage shall be entirelyAt the insureds own risk.
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CONDITIONSCONDITIONS
The company may cancel the policy
By sending seven days notice & will
Return the premium paid less the pro
Rata portion thereof
The policy may be cancelled by theInsured on seven days notice:
Provided no claim has arisen during
The currency of the policy
Insured shall be entitled to a return
Of premium less premium at theCompanys short period rates..
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CONDITIONSCONDITIONS
Subject to retention of the minimum
Premium of rs. 100
Rs. 25 for vehicles specifically
Designed/ modified for use by blind/
Handicapped/ mentally challenged
Where the ownership of the vehicle
Is transferred, the policy cannot beCancelled unless:
Evidence that the vehicle is insured
Elsewhere is produced.
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CLAIMSCLAIMS
Type of losses:
Total loss (accidental)
When insured vehicle is damaged to the
Extend that repairs is uneconomical to the
Company or cost of retrieval exceeds the idv.
If assessed value of the loss exceeds 75% of idv
(Ctl).
Total loss (theft)
When physical presence of vehicle is not
There i.E.Vehicle is stolen.
Partial loss (accidental)
Repairable loss occurring due to an insured
Peril.
Partial loss (theft)
Theft of parts/ accessories.
Accessories covered only in private cars.
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CLAIM PROCEDURESCLAIM PROCEDURES
Immediate notice of loss in
Writing to be given
For accidental losses, estimate
Of repairs and claim form to beSubmitted
For loss due to theft of vehicle,
A copy of f.I.R. Along with a claim
Form to be given
To appoint a surveyor for
Assessment of loss/ an
Investigator to investigate the
Theft..
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CLAIM PROCEDURESCLAIM PROCEDURES
Original r/c, d/l to be produced
Repairs can be started in case of
Partial loss, after initial verification
By surveyors
Claims are subject to compulsoryExcesses
In case of total loss, limit of
Liability will be idv
Any dispute regarding quantum of
Claim amount has to be referred to anArbitrator
Time limit for filing a suit after
Disclaimer is 12 months from date of
Such disclaimer.
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THANKSTHANKS