COMMERCIAL VEHICLE INSURANCE FAQs

What is the amount for which I need to insure my commercial vehicle? How is IDV connected to the amount needed to insure vehicle?

Commercial vehicles, like private vehicles, are insured as per their IDV. IDV is the ex-showroom price of a vehicle inclusive of sales tax. The IDV excludes costs like depreciation, registration, and insurance.

If a vehicle is stolen or the vehicle is totally damaged that no repair can redeem, the claim amount payable will be determined on the IDV value.

The IDV is calculated based on the vehicle’s listed price. This price depends on the brand and model of the car and the accessories. This price will be taken at the inception of the insurance policy by IFFCO Tokio.

IDV = Ex-Showroom price plus sales tax minus depreciation, registration, and insurance.

What kind of risks is covered by IFFCO Tokio third party policy?

The risks covered by this Third-Party policy include:

  • Death or injury to a third-party.
  • Damage of third party property.

In insurance, there are two main parties involved- the insurer and the insured. If the damages and loss occur to anyone else other than the insurer, it constitutes a ‘third-party’. When an insurer buys insurance, it wants to protect itself from its own damages and losses whether it was caused by its own mistakes or a third-party’s. The insured also wants to protect itself from any legal liabilities it may have towards a third-party if the fault was at his end.

Consequences if I forget to renew my commercial auto insurance on time

The following would be the consequences if a person forgets to renew his commercial vehicle insurance on time:

  • In the event the vehicle has an accident; the insurance company will not pay out claims.
  • No-claims bonuses will not be paid to the insured.
  • Driving a vehicle whose license has expired is illegal and can lead to fines.

Can I renew my commercial vehicle insurance with IFFCO Tokio?

Yes, you can choose to renew your commercial auto insurance with IFFCO Tokio. You will need to fill in a fresh proposal. IFFCO Tokio may also require a physical inspection of the vehicle. The best part of the facility is that the insured can transfer the accrued bonuses to the new insurance policy.

What is a No Claim Bonus?

If an insured doesn’t make any claims during the policy tenure, he becomes eligible to receive some benefits at the time of renewal of the policy. These benefits are known as no claim bonuses. This benefit goes on accumulating for every no-claim year. The final benefits can range from 20% up to 50% of the premium amount. In case a claim is made, the insured will not be able to avail of any no claim bonus.

The no-claim bonus is given to the insured and not to the vehicle. The implication of this is that on the transfer of the vehicle, the policy can be transferred to a new owner, but not the ‘no-claim bonuses’. The good part is that the original owner can avail the no claim bonus on a new vehicle purchased by him.

If I change my insurance company to IFFCO Tokio, will my no claim bonus get transferred too?

Yes, your no claim bonus will get transferred to your IFFCO Tokio commercial vehicle insurance at the time of policy renewal. However, you will have to submit proof of the no claim bonus earned. You can do this by submitting your original policy along with a certification that proves that you have not made any claims during the policy tenure. The proof can be in the form of a renewal notice or a letter from the insurer acknowledging the bonus accrued to the insured.

What is the meaning of “Deductible”?

Deductible or excess an insured will pay in an insurance claim before the insurance cover starts paying the insured. This is the out of the pocket expense of a policyholder. Under Motor Insurance policy, there is a normal standard/compulsory excess for most vehicles ranging from Rs 50 for two-wheelers to Rs 500 for Private Cars and Commercial Vehicles which increases depending upon the cubic capacity/carrying capacity of the vehicle.

The cubic capacity/carrying capacity of the vehicle increase this cost other than factors like the age of the vehicle or if there is a high frequency of claims made by the insured.

How is the premium determined in Commercial vehicle Insurance?

There are many factors on which premium amount is determined and there is some variation in the premium charged by different insurers on similar covers. The parameters for comparison are deductibles, coverage, and Insured declared value (IDV) of the vehicle.

Some insurers have lower premiums but higher deductibles, while other insurers offer lower coverage and lower insured declared value. At IFFCO Tokio, expect the best coverage for the premium you pay.

What commercial auto Insurance Cover should I buy? Why is a comprehensive policy more expensive than liability only?

In India, third-party liability insurance is a mandatory buy for all vehicles plying on the roads in India. The liability-only policy covers losses and damages to people and property caused by the insured to others. A comprehensive policy covers both ‘third-party liability’ and damage to the insured’s own vehicle. A comprehensive policy is broader and therefore more expensive than a liability-only policy.

I have lost my commercial vehicle insurance policy. Is it possible to acquire a duplicate one?

Yes, you can acquire a duplicate insurance policy. For this, please contact IFFCO Tokio on 1-800-103-5499 and place a request for the same. There may be a nominal charge involved in providing a fresh copy of the insurance policy.

If I buy my commercial vehicle in a particular city and then I move to another city, which premium rate will be applied?

The place where the commercial vehicle is registered is the place that will be considered for applying the premium rate. Even if you shift to another city or town, the same rate will be applied to your vehicle. If a vehicle is registered in a town viz- a -viz a city, the Zone B premium rate will be applied. For vehicles registered in cities, Zone A premium rate is applied to them.

What is the period of a commercial auto insurance policy?

A commercial vehicle insurance policy is usually of one-year duration in India subject to renewal before the due date. It is also mandatory upon the insured to pay the payment on time. In case, the policy lapses even for one day, the vehicle must undergo inspection. In case of a comprehensive policy, if it is allowed to lapse for more than 90 days, the accrued no claim benefit will be lost to the insured.

What are the different coverage limits an insured can avail?

An insured can avail sum insured for the vehicle which is called ‘Insured Declared Value’. The insured declared value reflects the current market value of the vehicle minus depreciation. Under liability coverage, the insured can avail third party liability cover. Insurers offer third party liability cover against injury and damage up to a sum of Rs. 7, 50, 000. However, there is an option to opt for lower coverage at Rs, 6000. A lower coverage will result in a lower ‘liability only’ premium.

Is service tax applicable on commercial vehicle insurance and by how much?

Service tax is applicable on the commercial vehicles as per the prevailing rule of law.

My address has changed. How do I get my new address updated in the policy documents?

If there are any changes in the information provided in the policy like change of address or changes to the vehicle or its use, a formal endorsement is needed to be done by IFFCO Tokio. For this, the insured must submit a letter to the insurer with proof of the changes. Some endorsements may require the insurer to pay an additional premium. It is advised that the insured checks for the correctness of the endorsement within the commercial vehicle insurance policy.

What is a certificate of Insurance under Motor Vehicles Act?

In motor insurance, a separate certificate of insurance is issued by insurers other than the policy. This document must be carried in the vehicle by the insured. The policy document must be preserved separately at home/office.

What are documents to be kept in the vehicle while paying plying on the road?

The following documents are to be kept in the vehicle while paying to ply on the road:

  • Certificate of Insurance.
  • Xerox copy of Registration Certificate.
  • Pollution Under Control Certificate.
  • Photocopy of Driving License of person who is driving the vehicle.

 

Is it possible to transfer my insurance to the buyer of my vehicle?

Yes, the insurance can be transferred to the buyer of the vehicle. However, the seller must inform in writing of such transfer to the insurance company. A fresh proposal form needs to be filled in. There is a nominal fee charged for transfer of insurance along with pro-rata recovery of NCB from the date of transfer till policy expiry. It may be noted that the transfer of ownership in cases of comprehensive covers has to be recorded within 14 days from the date of transfer. If the insured fails to do so, no claim will be payable for his own damage to the vehicle.

When exactly do I need commercial auto insurance?

A commercial auto insurance is required for any vehicle that you use for business purpose, provided it is also registered as a commercial vehicle. A commercial vehicle will also have a commercial license plate or tag.

The following functions are usually performed by commercial vehicles only and therefore need commercial auto insurance cover:

  • Using the vehicle to carry equipment and machinery.
  • Using the vehicle to transport flammable or hazardous material.
  • Using the vehicle to transport housekeeping equipment for business purpose.
  • Using the vehicle to tow other vehicles.
  • Using the vehicle to carry cranes plows etc.
  • Using the vehicle to deliver retail or wholes sale products.
  • Using the vehicle to deliver newspaper.
  • Using the vehicle to transport people as cab or auto rickshaw service.
  • Using the vehicle to run miscellaneous errands on behalf of a business.

Is it possible to continue the insurance in the name of the earlier owner even if the vehicle has been transferred to my name, and the same reflects in RTO records?

This is not possible because registration and insurance of the vehicle must be both in the same name and address. Once the vehicle has been transferred to the new entity, a fresh proposal form must be filled in. There is a nominal fee charged when a policy changes hands from one party to another.

What are the documents that must be submitted for a motor insurance claim?

Usually, most motor insurance companies require the following documents to be submitted during settlement of claims:

  • Registration copy of the vehicle.
  • Original estimate of loss.
  • Original repair invoice.
  • Payment receipt.
  • Non-traceable certificate in case of theft claim.
  • Keys to be submitted in case of theft claim.
  • Repair invoice in case cashless facility is availed.

What is a cashless vehicle insurance policy?

Cashless insurance policy is a facility wherein auto insurance companies have tie-ups with authorized garages. The insured can get his vehicle repaired at one of these garages after an accident. The insured doesn’t have to pay for the repair work; the insurance company will bear the expenses of the insured’s behalf.

What is depreciation in commercial vehicle insurance?

Vehicles depreciate with age. Usually, the depreciation of vehicle comes into play when there is claim for total loss. Total loss occurs when the vehicle is stolen. In a situation, where parts of a vehicle are damaged, the depreciated of parts of the vehicle will be considered at the time of settlement of claim, based on the rate of depreciation. This means, the payment is made for the reduced amount and not for the cost of replacement of the part. The rest of the cost of the parts will be borne by the policyholder out-of-pocket.

The rates of depreciation are as listed below:

  • For a typical paint job, a depreciation rate of 50% is applied to the material cost of the paint. However, if a consolidated amount is charged for the paint job, then the cost of paint material is considered to be 25% of the total cost and the 50% rate of depreciation is applied on it.
  • For all rubber/ nylon / plastic parts, tyres and tubes, batteries and air bags the depreciation rate will be at 50%.
  • For fibre glass components, the depreciation rate will be at 30%.
  • For all parts made of glass - Nil.
  • In the case of a paint job, which costs Rs. 15,000 and the cost of the paint in the job is Rs. 3,000, the insurance company will only pay 50% of the cost of the paint. So, Rs. 1,500 will be borne by the insured out of pocket.

What are the two types of deductibles in commercial vehicle insurance?

Compulsory deductibles: This is a fixed amount and depends on two factors: type of vehicle and the engine capacity of the vehicle. For older vehicles, the compulsory deductibles are set at a higher value by Insurance Regulatory and Development Authority of India (IRDA).

Voluntary deductibles: This is an optional amount that may be chosen by the insured at the time of buying the insurance policy. If an insured opts to pay higher deductibles, the vehicle premium will come down. It is generally recommended that if the policyholder doesn’t make frequent claims, he should pay a higher deductible and keep the premium at a lower level.

What are the exact steps to be followed to make a cashless claim?

When making a cashless claim, the following are the steps the policyholder must perform for ease of claim settlement:

  • Immediately after the vehicle is involved in an accident, the insured must contact the insurance company and report the incident. The insured is also required to inform the police and file an FIR if there are serious injuries or death following the accident.
  • The insurance company will get the vehicle towed to a network garage where the vehicle will undergo a physical inspection. The policy holder must not attempt to move the vehicle by himself without informing the insurance company.
  • The network garage will make estimation for the repair work, and this will be examined by the insurer. Following this, with the approval of insurer, the repair work will start.
  • The service station then repairs the vehicle and submits the relevant bills to the insurance company. The insurer will examine the bills and other documents submitted.
  • Once all the evaluation and verification is done, the claim pay-out process will start. The insured will have to pay the amount equivalent to deductibles and depreciation. The insurance company will pay the remaining amount directly to the network garage.
  • In a total loss situation, if the car was damaged beyond economical repair, the insurance provider will make a payment to the customer that is equal to the market value of the car after accounting for depreciation.

Why is it recommended to buy a RTI add-on?

RTI add-on is an option provided by insurers to bridge the gap between the invoice value of the vehicle and its insured declared value. With this cover, the insured can get a reimbursement of the on-road price of the car that was paid for the car. A cover with the RTI add-on costs around 10% more than a comprehensive car insurance policy but is very useful to recover the entire loss of the car.

When should an RTI be applied?

RTI can be applied under certain situations only:

  • An insured cannot make claims for small damages like cracks or dents. The RTI cover is useful to cover complete damage to the vehicle or when the vehicle is stolen.
  • RTI cover is for complete reimbursement of the cost of the vehicle at which it was initially bought. That is, it helps recover the on-road price of the vehicle.
  • The RTI cover is suitable for new vehicle owners because if a new vehicle is lost or completely damaged in an accident, a depreciation cost at the rate of 5 % in the first 6 months and 10 % in the following year is still levied on the vehicle. The depreciation rate keeps on increasing for each subsequent year. Therefore, it is prudent for the owner to include this add-on cover to a comprehensive car insurance policy.
  • When the insurer settles a claim with RTI add-on cover, they may either pay the insured the entire on-road price of the car or exclude the cost of specifics, like road tax, registration charges etc. Insurance companies at times compensate on percentage basis in addition to ex-showroom price of the vehicle.
  • RTI cover can be availed by vehicles not older than three years. For older vehicles than 3 years, the depreciation cost will be much higher and it will not make financial sense to the insurance company to give this facility to customers. The company would suffer losses if it were to give such a cover to customers.
  • A normal vehicle insurance cover will not fetch the insured an amount that is equal to the on-road price. Therefore the RTI add-on is beneficial to safeguard a new vehicle especially in areas where vehicle theft is common.

What is an endorsement in motor vehicle insurance?

An endorsement is a written evidence of the fact that there is a change in the terms of a policy or in the information provided by the insured. For example, if the insured’s address has changed, it has to be endorsed by the insurer.

Can I get my premium money refunded?

No, it is not possible to get the premium refunded unless the policy is cancelled. The insurer retains the premium on short period scale and refunds the remaining amount. Moreover, the insured can be eligible for refund only if there has been no claim during the policy period.

Are there any pre-conditions to cancellation of policy before its expiry date?

Yes, in general cancellation of motor insurance policy is allowed under the following two situations:

  • The insured has insured his vehicle with some other insurance company, at least for the third-party liability.
  • The vehicle has been sold or registered again.

Can we buy an add-on without a policy?

No it is not possible to buy only an add-on without purchasing a policy. Add-on covers are additional benefits offered along with an insurance policy.

Is any limit to the number of add-on covers an insured can buy?

No there is usually no limit. However, some add-on covers may not be applicable for older vehicles.

What are the benefits of purchasing motor vehicle insurance online?

A customer can buy motor vehicle insurance through a website very quickly. He can access free quotes, calculate the best premium rates, and buy with the same quote within a period of seven days. There is no paperwork involved and the customer can use his credit card, debit card or net banking to do the purchase.

How will I know which add-on is required for me?

Insurers provide customized recommendations based on the vehicle’s age, vehicle type, no-claims-bonus history etc. Many insurance companies have sections in their websites where all the user needs to do is key-in his details to retrieve add-on recommendations.

Moreover, a quick online research is not only quite easy and simple but will also provide the customer a fairly good idea of what add-ons can be beneficial to his requirement.

What will happen to my policy if I sell my car?

If you sell your car to another person, the insurance policy is transferred in the name of the new buyer. The new buyer will have to apply for transfer of insurance in his name within 14 days from the date of transfer of the vehicle in his name.

However, if the vehicle owner wants to substitute another vehicle of his to this policy, the policy will not be transferred to the buyer. For this, the buyer will need to buy a new insurance policy.

Is it possible to buy add-on covers that the insured didn’t buy initially with the policy?

Yes, it is possible to buy add-on covers other than during the time of buying the policy. Usually, it is recommended to buy the add-on cover at the time of renewal of policy. This can be done online easily. However, if the insured wants to buy new add-ons mid-way, he must contact the customer care representative of the insurance company for guidance.

What is meant by break-in insurance?

Break-in-insurance occurs when the insurance policy lapses due to non-renewal on time. Indian motor law makes it compulsory for every vehicle owner to have third-party liability cover. In case of break in, the insured must get in touch with the insurance company to renew the policy if it has been less than 90 days so as to retain the No Claim Bonus. In case, the insured has to buy a new policy altogether, he will have to get his vehicle inspected.

Is it possible to get new add-ons online at the time of policy renewal?

Yes, it is possible to get new add-ons online at the time of policy renewal.

Is it possible to transfer No claim benefit?

Yes, it is possible to transfer accrued benefits from one company to another provided the vehicle is insured within 90 days of renewal date of the policy.

What is a premium?

Premium is the fixed amount of sum paid over the period by the insured to the insurance company in exchange of benefits or covers availed as part of the insurance policy. The insurance premium is income for the insurance company and also represents a liability because the insurer must provide coverage for claims being made against the policy.

What is Personal Accident cover for passengers in a commercial auto insurance cover?

Personal Accident Insurance for Passenger covers monetary pay-outs towards injuries sustained to passengers in a commercial vehicle in an accident. The add-on covers:

  • Capital Sum Insured for which the maximum amount is Rs. 2 lakhs per person.
  • Permanent total disablement.
  • Permanent partial disablement.
  • Accidental Death.

Is it possible to pay commercial vehicle insurance premium in installments?

No, it is not possible to pay premium in instalments because as per Section 64 VB of Insurance Act, 1938, the insurer will not assume any risk unless the premium is paid in advance. Therefore, full premium will be collected from the insured before the start of the policy itself.

How do we define electrical and non-electrical accessories?

Electrical accessories are electrical or electronic equipment that are usually not fitted with the vehicle. Some examples of electrical accessories include:

  • Music system.
  • LCD mini TV.
  • Fog lights.

Non-electrical accessories cover any non-electrical/ non-electronic equipment that is not factory fitted with the vehicle. Some non-electrical/ non-electronic equipment include:

  • Mag wheels.
  • Leather seats.
  • CNG-kit.
  • Interior fittings.

How do we calculate the value of vehicle accessories?

Value of electrical accessories will be as declared by the insured.

What is a short period rate?

It is a type of method to calculate the penalty amount for cancelling a policy before its due date. A short period rate cancellation method allows the insurer to retain unearned premium (UEP) that is more than what is done in pro rata cancellation method. Therefore, it acts as a disincentive for the insured to cancel a policy before it expires.

What are the details that are required to be submitted while registering a claim?

The following details are required to be submitted while registering a claim:

  • Policy number.
  • Vehicle Registration Number.
  • Caller details / relation with insured.
  • Date / Time & Place of the incident/ accident.
  • Detail description of the incident/ accident.
  • Type of loss whether Own damage/Theft/third-party.
  • Type of physical injury or damage.
  • Whether the incident has been reported to police. If yes, the FIR no.
  • Name of the driver(This should be as per the name mentioned in driving license).
  • Current location of the vehicle.
  • Garage preference where the insured would like to get it repaired

Once the above information is provided, the call centre of the insurance company will provide the insured with a unique number known as claim no. The claim no will be used for all future correspondence.

How long does it take for a claim to get settled?

Once the insurer receives all relevant documents like original repair invoice, satisfaction voucher, discharge voucher, and necessary fund transfer details, the claim will get processed within 7 working days.

What is salvage and total loss?

Salvage is the value of wreck following an accident which renders the vehicle totally damaged so much that it no longer makes economical sense to repair the vehicle. For older model vehicles, sometimes a minor damage can render it useless because the total repair expenses will be more than what the vehicle is worth.

During the policy period if the insured adds accessories, will the policy cover them also?

Yes, they will be covered but the insured must make a written request to the insurer about the addition of new accessories in the vehicle. He must also provide description of the accessories and information on their value. An additional premium may be levied on the insured.

I own a vehicle which met with an accident two days back. But my original driver was not driving the vehicle. Can I still make a claim?

Yes, you can make a claim provided the following conditions are fulfilled:

  • Insurance policy for the vehicle should exist.
  • If you have paid the premium for a paid driver and the car was driven by him with your permission.
  • The person driving the vehicle is duly licensed because the premium is based on seating capacity and includes the person on driver’s seat.

My vehicle met with an accident but luckily the damages were really minor. Do I still have to lodge a claim or is it optional to lodge a claim especially when the damage is minor?

It is not necessary to always lodge a claim especially for minor damages. For very small damages, the claim amount will be very small and you will still have to pay for depreciation and excess. Most significantly, you will lose your no claim bonus at the time of policy renewal. However, once you have decided not to make a claim for a particular accident, you will not be able to make a claim for the same at a later stage.

Under what conditions, can a claim be rejected by an insurance company?

A claim may be rejected by an insurer under certain circumstances. Some of these circumstances are as mentioned below:

  • The policy has expired or has been cancelled.
  • The premium cheque has been dishonoured.
  • The date of accident is outside the policy period.
  • The person driving the vehicle at the time of accident didn’t possess a valid license.
  • The person driving the vehicle at the time of accident was under the influence of alcohol or drugs.
  • The vehicle has changed owners but the same has not been informed to the insurer within the stipulated 14 days..
  • The damages existed before the policy started.
  • The nature of damage doesn’t correlate with the cause of the accident.
  • The vehicle was used for some other purpose other than commercial business or what was mentioned in the proposal.

What is loading? What is the charge for loading?

Loading is an additional premium to be paid at the time of renewal of policy when the company feels that the insured is prone to risks. The additional premium helps the insurer cover losses which may be higher than what is anticipated.

In general, a vehicle which is more than 4 year old will be subject to 5% loading, and vehicle with age 7 and above will be loaded with additional 10%. Vehicles that are aged more than 10 years are subject to maximum 15% by some well-known insurers.

The loading charge is due to the anticipation that older vehicles are more prone to risks of accidents, damages, and other wear and tear.

Can a person be covered by commercial auto insurance policy when he uses his own vehicle on the job?

No. If an employee in a commercial business is using his own personal vehicle to run business errands or even to attend meetings he will not be covered under the commercial policy. In some countries like US, there is option to add an endorsement to the insurance policy to provide coverage for this type situation.

What should an insured do if his vehicle is stolen and he loses his original policy too?

The insured must report the matter to the insurance company, the police, and the RTO where the vehicle was registered. The RTO must formally acknowledge the letter sent by you informing them about the theft.

The insured must also call the insurance company to get a duplicate copy of the policy and to start the process of filing the claim. The insured will need to fill in a claim form and submit the police FIR to the insurer. An investigator will be appointed to trace the lost vehicle. Depending on the outcome of the investigations, the insurer will offer the insured a claim settlement. A few additional documents may be required during the claim settlement process.

What is meant by total loss?

By total loss, we mean damages incurred on the insured’s vehicle where the cost of repair amounts to more than 75% of the IDV on his policy.

What is the process for determining liability in a commercial auto accident?

Cases of accidents are assessed according to Tort Liability (that is, compensation must be paid by whomever is negligent or at fault), unless both parties to the accident are insured by companies that are bound by the Intercompany Settlement Agreement. This agreement specifies how claims would be adjusted given the particular scenario.

What is “Drive Other Car” coverage?

“Drive other car” insurance policy provides coverage for personal use of a non-owned commercial automobile by the insured.

“Drive other car” provides the following benefits:

Liability cover

Medical payments

Uninsured/Underinsured motorist coverage

Physical damage coverage

If an individual, for example, a company officer, does not have his own personal auto policy, and uses a corporate car for person use, this coverage is apt to protect them from exposures that may occur from using someone else’s car. Similarly, if an executive of a partnership or corporation or their spouse drives a non-owned vehicle that is rented or borrowed, the ‘the drive other car’ is useful.

Can other people drive a business vehicle owned by me?

Yes, other people may drive your business vehicle with your permission. However, make sure that they are listed on your policy if they are regular drivers of the vehicle.

Why does my private passenger vehicle have to go on my commercial policy?

If a private passenger vehicle (not a pick up or a van) is registered in the name of a business, it must be covered under a business auto policy. If the vehicle is registered in the individual’s name, but is used for business use, some uses may be covered under the personal auto insurance policy and the personal auto policy must be designated as business use.

How does the Common Law define ‘Negligence’?

Under common law ‘Negligence’ generally means careless or inadvertent conduct that results harm or damage which is quite common in automobile accidents. One can be negligent in two ways- First, by failing to do what needs to be done to avoid an accident. Secondly, by actively doing something (such as running a red light) that can result in an accident. Reckless or wanton conduct refers to intentional disregard for the safety and welfare of others. Strict liability under ‘Negligence’ may also be imposed in some cases, even in the absence of fault. For example, if the accidents involved certain defective products or extra hazardous activities such as the transporting of explosive chemicals without taking adequate safety measures and endangering others in the process.

If an insured lodges a claim after the vehicle insurance expires for an accident that occurred during the policy term, will the company reject the claim as invalid?

No, the claim will be valid. However, the insured must report the incident within seven days of occurrence of the event. An FIR should be lodged along with all required documents which will work as an evidence of the date of occurrence of the event. Upon failure to adhere to the above steps, the claim will be deemed invalid.

What is Vahan Vihan?

Ministry of Road Transport and Highways, Government of India has initiated Vahan Citizen services, an e-portal for payment of taxes and registration of vehicles. Vahan Online Services are available for different states/RTOs. If you want to know about the availability of the services in your state and also avail on these services, you need to enter the registration number of your vehicle. Please mind that the registration number should not have any gaps in between.

Does the owner of a commercial vehicle need to pay tax even when the commercial vehicle is not plying on road?

An owner of a commercial vehicle has the option to apply for tax exemption for the period when his vehicle was off the road. For this, he must approach the transport department to understand the process as every state has a different process.

Does Motor Vehicle tax differ from state to state?

Motor vehicle tax is under the purview of state government. Each state has its own motor vehicle act based on which tax calculated.

What is meant by additional MV tax? Does it apply to all types of commercial vehicles?

Additional MV tax is applied when certain parameters exceed the specified limits. For example, the unladen weight of vehicle exceeds 50000.

What are the forms that must be submitted while paying tax online?

There is no need to submit any form while paying tax online.

I entered vehicle registration number in the e-portal but got the message “Alert! This service has not been activated for the concern State/RTO.” What does this mean?

Online tax payment facility is not available for every state in India as of now. Only a few states and their RTO have online facility for tax payment.

Which mobile number do I have to use to avail the facility for online payment of motor tax?

You can use any mobile number to avail online payment facility for motor tax payment. Once you enter your mobile no, you will get OTP for confirmation of mobile number. After that, you can proceed to the payment process.

My transaction showed as pending when I tried to make an online payment. What could be the reason?

This could be because you earlier transaction for the same vehicle is pending. You are not allowed to start a new transaction without settling earlier transactions.

Why did I get a “No record found” for my commercial vehicle?

All states and their RTOs in India are not yet covered under the online facility for motor tax payment. It is also possible that some of records of registered vehicles have not been migrated to the online portal.

I am trying to pay motor vehicle tax online for my commercial vehicle. But I got the message “Alert!!! Vehicle is blacklisted”.

A customer with a blacklisted vehicle cannot avail services for online payment. The customer must approach the respective department to remove his vehicle from blacklist. Once the vehicle is removed from blacklist, he can avail Vahaan services for payment of taxes etc

Why does a customer sometimes get "Transaction failed, please initiate new transaction” despite making a payment online?

The amount may be debited from customer’s account but reconciliation may still be pending at bank’s side. A customer should therefore keep checking his transaction status through “check pending transaction”.

How exactly does cashless commercial auto insurance policy work?

There are few steps in cashless settlement of motor insurance policy claims:

  • The insured buys a vehicle insurance policy from a company that has tie-ups with a wide network of garages in the country.
  • If the insured vehicle damages itself during an accident, the policy holder can choose to get it repaired at one of the garages from the network.
  • The insurance company pays the garage directly for the repair work done on the vehicle.
  • The insured is only required to pay on the deductibles and for depreciation of replaced parts.

Can a commercial vehicle owner pay Motor Vehicle Tax online and where?

Motor Vehicle tax can be paid online through the e-portal parivahan.gov.in. Alternately, it can be paid via state transport portal.

How exactly does cashless commercial auto insurance policy work?

There are few steps in cashless settlement of motor insurance policy claims:

  • The insured buys a vehicle insurance policy from a company that has tie-ups with a wide network of garages in the country.
  • If the insured vehicle damages itself during an accident, the policy holder can choose to get it repaired at one of the garages from the network.
  • The insurance company pays the garage directly for the repair work done on the vehicle.
  • The insured is only required to pay on the deductibles and for depreciation of replaced parts.

What are the benefits of purchasing motor vehicle insurance online?

A customer can buy motor vehicle insurance through a website very quickly. He can access free quotes, calculate the best premium rates, and buy with the same quote within a period of seven days. There is no paperwork involved and the customer can use his credit card, debit card or net banking to do the purchase.

Is it possible to buy add-on covers that the insured didn’t buy initially with the policy?

Yes, it is possible to buy add-on covers other than during the time of buying the policy. Usually, it is recommended to buy the add-on cover at the time of renewal of policy. This can be done online easily. However, if the insured wants to buy new add-ons mid-way, he must contact the customer care representative of the insurance company for guidance.

Is it possible to transfer No claim benefit?

Yes, it is possible to transfer accrued benefits from one company to another provided the vehicle is insured within 90 days of renewal date of the policy.

What is Personal Accident cover for passengers in a commercial auto insurance cover?

Personal Accident Insurance for Passenger covers monetary pay-outs towards injuries sustained to passengers in a commercial vehicle in an accident. The add-on covers:

  • Capital Sum Insured for which the maximum amount is Rs. 2 lakhs per person.
  • Permanent total disablement.
  • Permanent partial disablement.
  • Accidental Death.

How do we define electrical and non-electrical accessories?

Electrical accessories are electrical or electronic equipment that are usually not fitted with the vehicle. Some examples of electrical accessories include:

  • Music system.
  • LCD mini TV.
  • Fog lights.

Non-electrical accessories cover any non-electrical/ non-electronic equipment that is not factory fitted with the vehicle. Some non-electrical/ non-electronic equipment include:

  • Mag wheels.
  • Leather seats.
  • CNG-kit.
  • Interior fittings.

What are the details that are required to be submitted while registering a claim?

The following details are required to be submitted while registering a claim:

  • Policy number.
  • Vehicle Registration Number.
  • Caller details / relation with insured.
  • Date / Time & Place of the incident/ accident.
  • Detail description of the incident/ accident.
  • Type of loss whether Own damage/Theft/third-party.
  • Type of physical injury or damage.
  • Whether the incident has been reported to police. If yes, the FIR no.
  • Name of the driver(This should be as per the name mentioned in driving license).
  • Current location of the vehicle.
  • Garage preference where the insured would like to get it repaired

Once the above information is provided, the call centre of the insurance company will provide the insured with a unique number known as claim no. The claim no will be used for all future correspondence.

During the policy period if the insured adds accessories, will the policy cover them also?

Yes, they will be covered but the insured must make a written request to the insurer about the addition of new accessories in the vehicle. He must also provide description of the accessories and information on their value. An additional premium may be levied on the insured.

What should an insured do if his vehicle is stolen and he loses his original policy too?

The insured must report the matter to the insurance company, the police, and the RTO where the vehicle was registered. The RTO must formally acknowledge the letter sent by you informing them about the theft.

The insured must also call the insurance company to get a duplicate copy of the policy and to start the process of filing the claim. The insured will need to fill in a claim form and submit the police FIR to the insurer. An investigator will be appointed to trace the lost vehicle. Depending on the outcome of the investigations, the insurer will offer the insured a claim settlement. A few additional documents may be required during the claim settlement process.

What is meant by total loss?

By total loss, we mean damages incurred on the insured’s vehicle where the cost of repair amounts to more than 75% of the IDV on his policy.

What is the process for determining liability in a commercial auto accident?

Cases of accidents are assessed according to Tort Liability (that is, compensation must be paid by whomever is negligent or at fault), unless both parties to the accident are insured by companies that are bound by the Intercompany Settlement Agreement. This agreement specifies how claims would be adjusted given the particular scenario.

If an insured lodges a claim after the vehicle insurance expires for an accident that occurred during the policy term, will the company reject the claim as invalid?

No, the claim will be valid. However, the insured must report the incident within seven days of occurrence of the event. An FIR should be lodged along with all required documents which will work as an evidence of the date of occurrence of the event. Upon failure to adhere to the above steps, the claim will be deemed invalid.

What is Vahan Vihan?

Ministry of Road Transport and Highways, Government of India has initiated Vahan Citizen services, an e-portal for payment of taxes and registration of vehicles. Vahan Online Services are available for different states/RTOs. If you want to know about the availability of the services in your state and also avail on these services, you need to enter the registration number of your vehicle. Please mind that the registration number should not have any gaps in between.

Does the owner of a commercial vehicle need to pay tax even when the commercial vehicle is not plying on road?

An owner of a commercial vehicle has the option to apply for tax exemption for the period when his vehicle was off the road. For this, he must approach the transport department to understand the process as every state has a different process.

What are the forms that must be submitted while paying tax online?

There is no need to submit any form while paying tax online.

My transaction showed as pending when I tried to make an online payment. What could be the reason?

This could be because you earlier transaction for the same vehicle is pending. You are not allowed to start a new transaction without settling earlier transactions.

Why did I get a “No record found” for my commercial vehicle?

All states and their RTOs in India are not yet covered under the online facility for motor tax payment. It is also possible that some of records of registered vehicles have not been migrated to the online portal.

My vehicle met with an accident but luckily the damages were really minor. Do I still have to lodge a claim or is it optional to lodge a claim especially when the damage is minor?

It is not necessary to always lodge a claim especially for minor damages. For very small damages, the claim amount will be very small and you will still have to pay for depreciation and excess. Most significantly, you will lose your no claim bonus at the time of policy renewal. However, once you have decided not to make a claim for a particular accident, you will not be able to make a claim for the same at a later stage.

I am trying to pay motor vehicle tax online for my commercial vehicle. But I got the message “Alert!!! Vehicle is blacklisted”.

A customer with a blacklisted vehicle cannot avail services for online payment. The customer must approach the respective department to remove his vehicle from blacklist. Once the vehicle is removed from blacklist, he can avail Vahaan services for payment of taxes etc