Accident: Any Unforeseen and unexpected event is considered an accident. For insurance purposes it should be due to external, physical and violent means.
Break In: A comprehensive policy that has expired and the customer propose to seek insurance for the same vehicle is a break-in policy.
Cancellation: Insured can at any given point of time during the currency of policy can cancel the policy and can get the refund of premium on short period scale basis by a providing a notice of 7 days before the date of such cancellation. Insurer can also opt for cancellation, firstly a notice needs to be provided and the refund of premium is based on pro-rata basis.
Certificate of Insurance: This is a document evidencing that a motor vehicle is insured against TP liability as required under the Motor Vehicle Act, 1988.
Comprehensive Motor Insurance: A kind of policy where in the coverage is provided both for Third Party liability as well own damage to the motor vehicle.
Constructive Total Loss: A loss of sufficient amount to make the cost of salvaging or repairing the property equal to or greater than the value of the property when repaired.
Cover Note: A cover note is a temporary insurance certificate that is issued before the actual policy is issued to the insured, only after he has paid the premium for the insurance.
Coverage: The scope of protection provided under a contract of insurance; any of several risks covered by a policy.
Deductibles: It generally is the amount that is to be borne by the insured for any claims arising under the policy, this is arrangement is made by the insurer as to avoid frequent small claims.
Depreciation: A decrease in the value of property over a period of time due to wear and tear or adolescence. Depreciation is used to determine the actual cash value of property at time of loss.
Endorsement: It is documents which incorporates change or alteration in the existing policy. Endorsement is a duly signed written document which is attached with the policy document. An endorsement might or might not attract an additional premium.
Exclusion: These are conditions and perils which are generally not covered under the policy. No claim is provided on operation of such perils.
Insured’s Declared Value: It is the value for which the motor insurance is provided for. Such value is obtained from the seller’s price after providing the appropriate depreciation to the value. It also includes the cost of accessories installed in the vehicle. Depreciation is provided as per table specified by the India Motor Tariff.
Insured: One who buys and holds the insurance.
Insurer: One who provides the insurance.
Liability Only Policy: It covers the third party liability for bodily injury or death and property damage arising out of use of the insured vehicle. PA cover for owner driver is also covered in this. This is a mandatory cover by the MV Act, 1988.
No Claim Bonus: It is a discount offered by the insured on renewal if there has been no claim during the previous policy period, it increase every year. The discount so provided is on Own damage premium. The discount is capped at 50% of the total OD premium.
Own Damage: Damages which happens to the insured vehicle during an accident.
Owner Driver: A person owning a car and holding the driving license is known as owner driver.
Partial Disability: if due to an accident, the insured person due to injury is not able to do one or more of his work, then such a disability is known as partial disability. It can be permanent and temporary as well.
Personal Accident Claims: If due to an accident, injury or death of the owner driver or the co passengers happens and claim arises, then such claims are known as personal accident claims.
Policy Period: It is the period for which the insurance is active. Motor insurance generally used to be of yearly basis but now a day’s some insurers have started providing it for more than a year. This is period is mentioned on the insurance policy.
Policy Schedule: It actually is the policy; it contains all the information regarding the insurance opted for such as period of insurance, what is covered and what is not covered.
Preferred Garages: Garages which are tied up with the insurance companies to provide quick and easy assistance. Such garages provide cashless facilities for the repairs.
Private Car: A car which is used only for personal use.
Proposal Form: It is a document which is required to be filled by the proposer of the insurance; it seeks the basic information about the proposer and about the vehicle which is being insured under the motor insurance.
Renewal: It is said as the repurchase of the insurance when the previous one is expired or is generally purchased before the expiry.
Roadside Assistance: During the happening of an accident while the vehicle is on road and away from the city lines, motor insurance provides for variety of assistance to the insured vehicle as well as to the insured.
Salvage: In general terms it is the damaged vehicle which is beyond repair and in return of claim is given to the insurer.
Sum Insured: It is the limit of liability of the insurer under the policy for a given period of time.
Third Party Claims: A demand made by a person against a policyholder and any payment that will be made by that company
Third Party Property Damage: It is damage to the property of the third party by using an insured vehicle. Property can be anything holding any value. The limit for such damage is 7,50,000 for four wheelers and 1,00,000 for two wheelers.
Total Loss: The complete loss or destruction of the motor vehicle insured under the policy.
Total Theft Claims: It is claim for the vehicles which are stolen.
Zero Depreciation: It is an additional cover under which, if opted for then the insured won’t be charged the cost of depreciation on parts which otherwise would get deducted from the final claim amount and required to be borne by the insured himself. Although it is applicable only for partial loss claims.
