Motor insurance: Types of coverage plans, add-ons that vehicle owners should opt for during monsoon season

The monsoon is wreaking havoc across several states in the country and the Indian Meteorological Department has predicted even more rains in several hill states. During the monsoon season this year, we've seen numerous pictures circulating online showing overflowing rivers, waterlogged streets, landslides, and damaged bridges. We have seen Mumbai, Rajasthan, and Delhi suffering from the havoc of this monsoon season, and witnessed vehicles and cars being washed away in flood waters leading to severe financial loss for vehicle owners. The rainy season brings about several risks and challenges that can adversely affect vehicles, leading to various damages, and adequate vehicle insurance coverage can help one recover from the financial loss caused due to vehicle breakdowns.

It is pertinent to choose the right protection against vehicle damage caused due to heavy rains as the water can enter the engine, causing severe damage to the vehicle. In flood-affected areas, the risk of vehicle theft can also rise. Sometimes, floods can lead to debris and falling objects that may damage parked vehicles.

Firstly, let us understand the two main types of vehicle insurance policies — 

a) Third Party Plan: Every vehicle plying on the roads in India is bound by law to be covered by atleast the mandatory third party plan. With the vehicle owner and the insurer being the two parties involved in the insurance contract, the third party in this case refers to any person who is involved in an accident with the insured vehicle. In the case of third party insurance, the coverage covers any damage or injuries to third parties and their property due to the insured vehicle. 

b) Comprehensive Plan: As the name suggests, the comprehensive plan covers not just the third party but also the vehicle owner for any damages to the vehicle or the person driving it. With these add-ons, the comprehensive cover is more expensive than the third party insurance plan, however, it does offer more coverage, security and peace of mind in case of an accident or theft of the vehicle. 

The third party insurance cover is mandated by the government, and the comprehensive plan is optional.

Alongwith third-party insurance coverage and comprehensive vehicle insurance plan, relevant add-ons can give maximum protection to one's car or motorcycle during monsoons and flooding. 

Avinash Gaikwad, Chief Strategy Officer (CSO) of Bimaplan, says, "Insurance acts as a valuable tool, instilling financial security and reassuring that unexpected losses and damages can be handled without a significant financial burden. By investing in comprehensive insurance coverage and relevant add-on covers during the monsoon season, individuals can effectively manage the financial strain of unpredictable weather events."

He suggests these four useful add-ons for vehicle owners — 

1) Zero Depreciation Cover: Zero depreciation cover ensures that the vehicle owner gets the full claim amount without deducting for depreciation. "This is particularly useful when claiming damages caused by floods and monsoons," says Gaikwad.

2) Engine Protection Cover: As flooding can damage the vehicle's engine, this cover protects against engine-related repairs and replacements. However, the vehicle owners must take a flooded vehicle to the service station and not try switching it on, because that leads to hydro-locking of the engine and insurance companies consider it a negligence on the owner's part.

3) Roadside Assistance Cover: This cover can be beneficial during monsoons when vehicles are more prone to breakdowns. "It provides services like towing, fuel delivery, battery jump-start, and assistance for minor repairs," Gaikwad informs.

4) Property insurance cover: Property insurance during the monsoon is vital to protect against water intrusion, flooding, and roof leaks where the vehicles are stored. It ensures coverage for repairs and restoration, safeguarding homeowners and businesses from the financial impact of monsoon-related damages.

Gaikwad points out that it is essential to recognise that insurance is not a one-size-fits-all solution, as each individual has unique needs and vulnerabilities. Therefore, he says, it is critical to tailor insurance coverage to specific requirements. 

It is advised that individuals carefully assess their risks and consult with insurance professionals to take the right coverage to protect themselves from the financial fallout of vehicular issues and monsoon-related problems.