Commercial vehicle insurance

Commercial Vehicle Insurance

Know about the types, benefits, and coverage details of a commercial vehicle insurance policy.

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3 Mins
25-July-2023

Commercial vehicle insurance is a tailored motor insurance policy for commercial vehicles. These insurance policies cover vehicles used for commercial purposes like vans, taxis, and buses. This also includes trucks, trailers, tractors, and more. For businesses or individuals relying on vehicles for commercial operations, commercial motor insurance is immensely important. It covers the damages and losses to the commercial vehicle during its daily run.

What is a commercial vehicle insurance?

Commercial vehicle insurance is a type of insurance policy that provides coverage for vehicles used for commercial purposes, as stated above. Commercial vehicle insurance is mandatory for all types of commercial vehicles, including trucks, buses, taxis, etc., in India. Commercial vehicle insurance includes truck insurance, commercial car insurance, goods carrying vehicle insurance, etc.

This insurance policy provides coverage against losses or damages incurred from accidents, theft, and natural calamities. It also covers the legal liabilities of the vehicle owner arising from third-party property damage or bodily injury. You can purchase commercial vehicle insurance online, which makes the process simple and convenient. Adequate commercial car insurance coverage can protect your vehicle and business interests from unforeseen circumstances.

Benefits of commercial vehicle insurance

Here’s a quick look at the benefits you get if you have a commercial vehicle insurance.

Key features

Benefits

Customisable IDV

Available

NCB benefits

Available

Cashless claims

Available

Coverage for damages to third party 

Available

Personal accident cover

Available

24x7 claim support

Available

Own damage cover

Available only in comprehensive policy

Online renewal

Available


If your business owns one or many commercial vehicles, commercial motor insurance becomes a must for you. It financially covers your business from several losses and damages caused to and by your vehicle. Below are a few benefits of having commercial vehicle insurance:

  • Comprehensive coverage
    Policyholders get comprehensive coverage for both private and public commercial vehicles.
  • Third-party insurance
    The insurer takes care of the third-party liabilities in case of an accident, causing damage or injury to third party. It covers damages caused to the third party’s vehicle or property. It also covers any injury caused to the third party, even death.
  • Personal accident cover
    A personal accident cover provides financial coverage to the owner and the driver. This is in case of accidental injuries leading to hospitalisation.
  • Financial support
    Individuals with commercial vehicle insurance online can rest stress-free as the possible vehicle-related financial concerns will be taken care of by the insurance provider.

Who needs commercial vehicle insurance?

Any business, that operates vehicles like trucks, buses, taxis, etc., for commercial purposes, need to get a commercial vehicle insurance policy. This policy provides financial coverage in case of accidents, thefts, natural calamities, or any other unforeseen circumstances. Additionally, it covers the legal liabilities of the vehicle owner arising from third-party property damage or bodily injury.

For example, if you have a car used for commercial purposes, you should buy commercial car insurance. You can purchase commercial car insurance online, which is a quick and convenient way to ensure that your vehicles have the required insurance coverage.

Different types of commercial vehicle insurance

Primarily, there are two types of commercial car insurance policies:

  • Comprehensive commercial vehicle insurance
    Commercial vehicle insurance plan covers damages caused to the insured's vehicle due to robbery, theft, or fire. Also, due to floods, earthquakes, etc. This commercial insurance policy also covers the benefits of third-party insurance.
  • Commercial vehicle's third-party liability insurance
    A third-party commercial car insurance policy is mandatory by law. The policy covers damages and losses caused by your vehicle to any third party or their properties.

Add-on covers available on commercial vehicle insurance

You can also opt for several add-on covers with a commercial insurance policy. Some of them are:

  • Consumable cover
    This option covers screws, bolts, grease, and engine oil if any damage is caused by an accident.
  • Engine and gearbox cover
    This add-on coverage takes care of damages such as fluid leakage or water ingress.
  • EMI protection cover
    This add-on cover helps pay the EMI for a loan taken to buy the vehicle.
  • Roadside assistance
    Those opting for this additional coverage get roadside assistance if their vehicles break down due to a flat tyre, accident, or problems with the battery.
  • Loss of revenue
    The insurer compensates the loss of income if the vehicle is at a garage for repair due to accidental damages sustained.

Factors to look for while buying or renewing a commercial vehicle insurance policy

Here are some pointers to keep in mind while buying or renewing a vehicle insurance policy:

  • Third-party insurance
    The Indian Motor Vehicles Act mandates every vehicle owner to have a third-party insurance policy to drive legally on the Indian roads. Hence, while choosing an insurance policy, ensure you get coverage for third-party liability.
  • Insured declared value
    The insurance companies consider the vehicle’s Insured Declared Value (IDV) to the set the maximum sum insured in the policy. Basis the IDV, you will get the sum insured in case of total loss or damage caused to your vehicle.
  • Claim settlement ratio
    Check the claim settlement ratio and process before buying a commercial vehicle insurance policy. Knowing the claim settlement ratio will help you understand the insurer’s credibility to pay the claim amount. Also, know the claim settlement process to avoid any hassle when making the claim.
  • Cashless garages
    Check the number of network garages associated with the insurer and their location. This will help you get cashless services to repair your vehicle hassle-free.
  • Deductibles
    You can opt for deductibles if feasible. You will have to pay a certain portion of the claim amount from your pocket. Check the terms and conditions applied to deductibles and how much percentage does the insurer offer. Based on that, evaluate whether you can afford it. If you choose deductibles, your premium value reduces.
  • NCB/discount
    For every claim-free year, you get a No Claim Bonus (NCB). Check the accumulated bonus value when renewing/transferring your commercial vehicle insurance policy.
  • Add-on benefits
    Comprehensive commercial insurance policies give you the option to add the add-on covers to your policy. You can enhance your regular insurance policy with add-on covers to stay adequately covered.

Key inclusions of a commercial vehicle insurance

A commercial car insurance policy covers the damages caused due to the following incidents:

  • Accidents
  • Theft
  • Fire
  • Natural disasters
  • Personal accident
  • Third-party losses
  • Towing disables vehicles

Key exclusions of a commercial vehicle insurance

A commercial vehicle insurance policy does not cover the damages caused in the following situations:

  • Own damages for the third-party policyholder
  • Drunk driving or driving without a licence
  • Contributory negligence
  • Consequential damages

Types of commercial vehicles covered

Here are the types of commercial vehicles covered under a commercial vehicle insurance policy:

  • Passenger-carrying vehicles, such as cabs, taxis, auto-rickshaws, private buses, etc.
  • Goods carrying vehicles, such as trucks, lorries, etc.
  • Miscellaneous and special vehicles, such as mining and farming vehicles.

How to file a claim for commercial vehicle insurance?

One can follow these simple steps to raise a claim online:

Step 1: Contact the insurer and fill up the claim form.

Step 2: Submit all relevant documents.

Step 3: A surveyor will conduct an evaluation of the damages in the vehicle and report the same to the insurer.

Step 4: After the insurer accepts the claim, you will receive the claimed amount.

Commercial vehicle insurance from Bajaj Finance: What makes it a good decision

Bajaj Finance partners with top insurers to offer the best insurance policies, considering customer’s demands and requirements.

Here are the reasons to opt for a commercial vehicle insurance policy from Bajaj Finance:

  • Comprehensive coverage for a wide range of losses and damages
  • A paperless policy claim process
  • 24-hour customer support team
  • Lucrative facilities, such as personal accident cover, compulsory deductibles, legal liability cover, etc.
  • Online insurance purchasing and renewal

If you are searching for a dependable commercial vehicle insurance plan, choose from a selection of plans available on Bajaj Finance Insurance Mall.

Frequently asked questions

Do I have to change my car insurance policy if I change the car registration from private to commercial?

Yes, you need to buy a new commercial car insurance policy. The coverages offered under commercial insurance policies differ from regular car insurance policies. You can check with insurer whether you can transfer any benefits from your previous car insurance policy. This would depend on the insurer’s terms and conditions.

What documents you need to submit when filing a commercial vehicle insurance claim?

You need to share the following documents with the insurer when raising a commercial vehicle insurance claim.
1. Duly signed claim form
2. Vehicle registration copy
3. Driving licence copy
4. Original policy documents
5. FIR copy
6. Routes permit
You must check with your insurer if more documents required. The document requirements vary from insurer to insurer.

What is the difference between comprehensive and third-party commercial vehicle insurance?

A third-party insurance for commercial vehicles only covers damages and losses caused to a third party. For example, their property, vehicle, or the person. The Motor Vehicles Act mandates every vehicle owner to have a third-party insurance policy.
A comprehensive commercial vehicle insurance covers third-party liabilities and damages caused to own vehicle. This insurance policy comes at higher premium than a third-party insurance policy, as it provides comprehensive coverages.

What kind of risks does a third-party commercial vehicle insurance cover?

A third-party insurance policy covers the death or injury of a third party due to an accident where you are at fault. It also covers the damages caused to the third party’s property or vehicle.

Where can I repair my commercial vehicle in case of damage?

You can get the vehicle repaired at any of the insurer’s network garages. This will give you the benefit of cashless repair services. If you choose to get the vehicle repaired at any of your preferred garages, you may have to clear the bills. You can later submit the bills to the insurer to get a reimbursement.

What should I do if my commercial vehicle gets into an accident?

Contact your insurer to inform about the accident and the extent of damages sustained. If you choose cashless services to repair the vehicle, the insurer will send someone to tow the vehicle to the nearest network garage.
Meanwhile, you need to lodge an FIR at the nearest police station. Get a copy of the FIR to submit to the insurer. Record the incident on the phone and take photos of the damages caused to the vehicle. You will have to share these proofs with the insurer when raising claim.
Read the policy documents when buying the commercial vehicle insurance to know the procedures in detail. You will know about the benefits, coverage, and limitations in the policy documents. It will help you when raising the claim for damages or losses.

What is IDV in my commercial vehicle insurance policy?

IDV stands for ‘Insured Declared Value’. It is the vehicle’s current market value and is the maximum amount that your insurer will pay in case of theft or total loss. The insurer calculates the IDV of your commercial vehicle based on its age, make, model, and other factors.

How do I calculate the commercial vehicle Insurance premium?

Commercial vehicle insurance premium depends on factors such as the vehicle type, location, vehicle age, the purpose of use, and risk. The higher the risk, the higher the premium. The premium amount can also vary depending on the coverage options selected, including third-party liability, comprehensive coverage, and add-ons.

What is the policy term of a commercial vehicle insurance policy?

The period of a commercial vehicle insurance policy can vary from one year to three years. The policyholder can choose the policy term as per their preference. However, you must choose a longer policy term to avoid the hassle of renewing the policy every year.

How do I cancel the commercial vehicle insurance plan?

If you wish to cancel your commercial vehicle insurance plan, you can contact your insurance provider and submit a written request for cancellation. The insurance provider will then initiate the process of cancellation and refund the premium amount based on the terms and conditions of the policy.

What does commercial car insurance cover?

Commercial car insurance covers the risks involved in using a vehicle for business purposes. It offers financial coverage against losses or damages resulting from accidents, thefts, and natural calamities. It also covers third-party liabilities, including property damage or bodily injury caused to them. You can customise commercial car insurance with add-on covers as per your requirements.

Do I need commercial car insurance?

If you use your vehicle for commercial purposes, then commercial car insurance is mandatory as per Indian law. Commercial car insurance covers the risks involved in using the vehicle for business purposes, securing you financially in case of any unforeseen circumstances.

How to make a claim on commercial car insurance?

In case of an accident or any loss or damage, the policyholder should immediately inform the insurance provider and file a claim. To file a claim, you must furnish documents like the claim form, FIR (in the case of accidents), repair bills, and other relevant documents. The insurance provider will then assess the claim and initiate the settlement process as per the terms and conditions of the policy.

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Insurance is the subject matter of solicitation. *T&C Apply - Bajaj Finance Limited (‘BFL’) is a registered corporate agent of third party insurance products of Bajaj Allianz Life Insurance Company Limited, HDFC Life Insurance Company Limited, Future Generali Life Insurance Company Limited, Bajaj Allianz General Insurance Company Limited, SBI General Insurance Company Limited, ACKO General Insurance Limited, ICICI Lombard General Insurance Company Limited, HDFC ERGO General Insurance Company Limited, Tata AIG General Insurance Company Limited, Niva Bupa Health Insurance Company Limited , Aditya Birla Health Insurance Company Limited, Manipal Cigna Health Insurance Company Limited and Care Health Insurance Company Limited under the IRDAI composite CA registration number CA0101. Please note that, BFL does not underwrite the risk or act as an insurer. Your purchase of an insurance product is purely on a voluntary basis after your exercise of an independent due diligence on the suitability, viability of any insurance product. Any decision to purchase insurance product is solely at your own risk and responsibility and BFL shall not be liable for any loss or damage that any person may suffer, whether directly or indirectly. Please refer insurer's website for Policy Wordings. For more details on risk factors, terms and conditions and exclusions please read the product sales brochure carefully before concluding a sale. Tax benefits applicable if any, will be as per the prevailing tax laws. Tax laws are subject to change. BFL does NOT provide Tax/Investment advisory services. Please consult your advisors before proceeding to purchase an insurance product. Visitors are hereby informed that their information submitted on the website may also be shared with insurers. BFL is also a distributor of other third party products from Assistance Services providers such as CPP Assistance Services Pvt. Ltd., Bajaj Finserv Health Ltd. etc. All product information such as premium, benefits, exclusions, sum insured, value added services, etc. are authentic and solely based on the information received from the respective insurance company or the respective Assistance service provider company.

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