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Important Things to know before buying a Commercial Vehicle Insurance Policy

Coverage options: Understand the different types of coverage for your commercial vehicle insurance, such as third party liability coverage, first party coverage, comprehensive coverage, medical payments coverage, and uninsured motorist coverage. Assess your business needs and select the appropriate coverage options.

What is IDV?

The Insured Declared Value is the maximum amount your insurance provider can pay out in case your car is stolen or damaged beyond repair. This value is determined by the manufacturer’s selling price of your vehicle and its depreciation calculated.

What is NCB (No Claim Bonus)?

A No Claim Bonus (NCB) is a discount on premium given to the policyholder for having a claim free policy term. A no claims bonus ranges from a discount of 20-50% and is something you earn at the end of your policy period by maintaining a record of having no accidents caused by your commercial vehicle.

What are Deductibles?

Deductibles are the amount the policy holder is required to pay out during a claim. There are generally two kinds of deductibles; one that is compulsory and the other, the voluntary claim- that you can opt and choose according to how much your business can bear per claim.

The higher your voluntary claim, the lower is your premium. However, while choosing a voluntary deductible amount- make sure it is an amount you’ll be able to afford in case a claim arises.

What is a Cashless Claim?

If you opt to get your commercial vehicle repaired with a Digit Authorized Repair Center, we will make the payment for the approved claim amount, directly to the Repair Center. This is a Cashless Claim.

Please note, if there are any deductibles, like a Compulsory Excess/ Deductible, any repair charges for which your insurance doesn’t cover you or any depreciation costs, that is to be paid by the insured’s own pocket.

What do you mean by a Third-Party Liability?

A Third-Party Liability is when your commercial vehicle damages a third-party property, person or vehicle. In this case, your insurance policy (Liability only policy/Standard Package Policy) is liable to financially cover for the losses incurred towards it

Legal requirements: Familiarize yourself with the legal requirements for commercial vehicle insurance in your jurisdiction. Ensure that the policy you choose meets the minimum insurance requirements mandated by law.

Vehicle information: Provide accurate and detailed information about your commercial vehicles when applying for insurance. This includes vehicle make, model, year, usage, and any modifications. The accuracy of this information ensures appropriate coverage and accurate premium calculation.

Driver details: Disclose accurate information about the drivers who will be operating the commercial vehicles. This includes their driving records, experience, and any relevant qualifications. Providing false or incomplete driver information can impact the validity of the insurance policy.

Exclusions and limitations: Review the policy documents to understand the exclusions and limitations associated with the coverage. These may include specific types of accidents or damages that are not covered, as well as any restrictions on vehicle usage or driver qualifications.

Deductibles: Determine the deductibles associated with the policy. A deductible is the amount you agree to pay out of pocket before the insurance coverage comes into effect. Consider your budget and risk tolerance when selecting the deductible amount.

Policy limits: Understand the policy limits for each coverage type. Policy limits represent the maximum amount the insurance company will pay in the event of a claim. Ensure that the limits are sufficient to cover potential losses and liabilities.

Premiums: Consider the premium cost associated with the policy. Premiums can vary based on factors such as vehicle type, usage, driver records, and coverage limits. Compare quotes from multiple insurers to get a sense of the premium range and choose a policy that provides the best value for your business.

Claims process: Familiarize yourself with the claims process of the insurance company. Understand the steps involved in filing a claim, the required documentation, and the timeframe for claim resolution. A smooth and efficient claims process is crucial when you need to make a claim.

Insurance provider reputation: Research the reputation and financial stability of the insurance provider. Look for reviews, ratings, and customer feedback to gauge their reliability and customer service track record. Choose an insurer that has a solid reputation and a history of prompt and fair claims handling.

Additional benefits: Inquire about any additional benefits or services offered by the insurance provider. This could include roadside assistance, loss of use coverage, or fleet management tools. Assess if these additional benefits align with your business needs.

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