Vehicle insurance

INTRODUCTION

Vehicle insurance (also known as car insurance or motor insurance) is insurance purchased for cars, trucks, motorcycles, and other road vehicles. Its primary use is to provide financial protection against physical damage and/or bodily injury resulting from traffic collisions and against liability that could also arise there from. The specific terms of vehicle insurance vary with legal regulations in each region. To a lesser degree vehicle insurance may additionally offer financial protection against theft of the vehicle and possibly damage to the vehicle, sustained from things other than traffic collisions.

                      You need motor insurance when you buy a motor vehicle. Motor insurance covers your vehicle, be it a motorcycle, a car or a lorry, in case of accidents or theft.

           There are three common types of motor insurance available: third party; third party, fire and theft; and comprehensive cover. The level of your coverage dictates what you can claim if your vehicle sustains loss or damages.

History

Widespread use of the automobile began after the First World War in the cities. Cars were relatively fast and dangerous by that stage, yet there was still no compulsory form of car insurance anywhere in the world. This meant that injured victims would seldom get any compensation in an accident, and drivers often faced considerable costs for damage to their car and property.

A compulsory car insurance scheme was first introduced in the United Kingdom with the Road Traffic Act 1930. This ensured that all vehicle owners and drivers had to be insured for their liability for injury or death to third parties whilst their vehicle was being used on a public road. Germany enacted similar legislation in 1939.

Public policies

In many jurisdictions it is compulsory to have vehicle insurance before using or keeping a motor vehicle on public roads. Most jurisdictions relate insurance to both the car and the driver, however the degree of each varies greatly.

Several jurisdictions have experimented with a "pay-as-you-drive" insurance plan which is paid through a gasoline tax (petrol tax). This would address issues of uninsured motorists and also charge based on the miles (kilometers) driven, which could theoretically increase the efficiency of the insurance, through streamlined collection.

               

When it comes to buying a policy, always:

·         Check the market value price of your vehicle. If it is a new vehicle, the insured value will be the purchase price.

·         Ensure that your vehicle is adequately insured as it will affect the amount you can claim.

·         Give all material facts about your vehicle, including previous accidents (if any), modification to engines,etc. When in doubt, it is best to ask your insurance company.

HOW MUCH SHOULD I COVER?

Make sure that the amount covered in your motor insurance certificate reflects the market value of your vehicle and not any other value to avoid over-insurance or under-insurance. You may check the market value of your vehicle

HOW DO I MAKE A CLAIM?

If you are involved in a motor accident and have a comprehensive cover, you may either make an own damage claim or a third party claim. There are different procedures involved. Inform your insurance company immediately and act according to their instructions. You may need to send your damaged vehicle to an approved workshop. You may check for the list of approved workshops from your insurance company. Make sure you send all relevant documents to support your claim to your insurance company as soon as possible.

CANCELLIN YOUR POLICY:

·         You may cancel your motor insurance policy at any time by notifying your insurance company in writing, inclusive of the date you want to stop the policy.

               

·         It is a good idea to have a new policy in place before cancelling your previous one so there is no gap in between coverage.

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·         Insurance companies also generally offer a refund premium based on how old your current insurance policy may be, the newer it is when you cancel it, the more refund you will receive.