The Motor Vehicle Act is the one that governs the use of automobiles in India. While it is typically laden with legalese, breaking it down for purpose of simplicity reveals several key aspects about it. One such aspect being car insurance in India. The law states that one cannot drive a vehicle on public roads without being covered by motor insurance.
A quick search for motor insurance online results in a few dozen hits from all the major insurance providers in the country. While the product offerings may vary, there’s two key types that come to the fore: comprehensive insurance and third-party car insurance. A mandatory requirement, it covers the legal liability of the motorist towards damages caused to others (human/property).
Let’s understand this aspect of car insurance in India via the following scenario: You’re turning into a lane and enter it a little quicker than usual. But there’s a hold-up at the other end of the corner, and you only realize it when it is too late, thereby crashing into the rear of the car in front of you. Both cars are damaged in the process and a heated argument typically ensues. Much time gets wasted as responsibility is sought & details of the payment for the damages caused are sorted out.
Ideally speaking, in the above scenario, the third-party car insurance cover should be useful in making right the wrong. It is meant for just this purpose - that of making good the damages caused to the car of the opposite person. Thus, it is not meant for the driver or their own car, but for others - the fellow motorists on the road.
The sad reality is that most motorists continue to be ignorant (sometimes, even by choice) of this vital documentary-legal compliance. For the sake of a few hundred/thousand rupees, they risk legal complications in the face of an incident. In doing so, they fail to realize that third-party insurance is meant to be a critical safety net to protect others from the implications of your actions. The scenario is changing slowly though, especially in major cities and towns, as law enforcement improves. With punitive fines being levied for offenders who drive on the streets without third-party insurance coverage, motorists are slowly starting to get the point.