By Rahul M Mishra
Possessing a vehicle has become a necessity in the contemporary world since it allows individuals to travel wherever they want at any time. While they may love their liberty, the possibility of an unanticipated accident is always present. Following such possibilities, the Government of India has made it mandatory for all vehicle owners to possess a legal insurance plan under the Motor Vehicles Act. It specifies the procedure for registering vehicles and issuing driver's licenses. It also establishes road restrictions, such as speed limits, parking laws, and traffic lights. In addition, it requires vehicle owners to undertake third-party insurance to cover liabilities that may arise due to accidents.
Moreover, purchasing motor insurance is a legal necessity and a crucial step towards protecting important goods and financial stability. Nevertheless, motor insurance is sometimes regarded as a trivial formality, with many vehicle owners purchasing it without much consideration. Choosing the correct motor insurance can be challenging owing to the variety of companies and policy options available. This is where the role of a point-of-sale person (PoSP) comes into play. They help potential customers choose an insurance policy that meets their needs and is reasonably priced, while also offering detailed information on the plan. With the guidance of PoSPs, people can efficiently filter through misinformation and myths to find the right policy. Thus, whether the individuals are seeking help from a POSP or researching on their own, it is imperative for people to avoid common misconceptions before purchasing a motor insurance policy.
Let’s debunk some of the common myths surrounding the motor insurance policy:
Myth: Old Vehicles Don't Need Insurance
Many people believe that the replacement value of an old car does not require the renewal of a third-party or comprehensive insurance plan. However, as per the government mandate, every vehicle needs to get insured, whether it is old or new. Furthermore, old cars have more chances of theft because of the demand for their parts. Thus, motor insurance is important for all vehicles and grants security to their owners and policyholders.
Myth: Insurance Covers Damage Only If Vehicle Owner Is Not Guilty
When an individual opts for a comprehensive motor policy, complete reimbursement is given for all types of accidents, including those in which the former is at fault. It protects vehicles against riots, floods, terrorism, mechanical issues, and other events. The only important requirement is that the vehicle owners need to submit their driving licenses while applying for a claim. While this policy protects both the vehicle and its owner against multiple events, it excludes damages caused when the driver is under the influence of drugs or alcohol. Therefore, people must understand that they need to use their vehicles while complying with the terms and conditions of this policy.
Myth: If An Individual Transfers His Policy To Another Insurer, He Will Lose His NCB
The reward that insurance companies offer to policyholders who do not file any claims throughout the policy duration is known as the No-Claim Bonus or NCB. It is an excellent method for customers to save money on their insurance premiums. In contrast to popular belief, it is passed on to the policyholder when he moves his insurance policy to another insurer, provided the transfer occurs within the stipulated timeframe, usually 90 days after the previous policy expires.
Myth: If A Person Sells His Car, The New Owner Will Acquire His NCB
The NCB reflects the driving skills and capabilities of the policyholder. Additionally, it does not get transferred to the new owner when a vehicle is sold.
Motor insurance is becoming increasingly important in today's world since it helps keep vehicles safe and also relieves individuals financially in the event of damage or an accident. By carefully analysing their requirements and avoiding common misconceptions, people can efficiently purchase a motor insurance policy that has the right coverage. While one can surely rely on their research to find an appropriate policy, the role of PoSPs cannot be overlooked. From understanding the insurance terminologies, choosing from the list of different policies, and facilitating seamless purchases, PoSPs play a vital role in helping people looking to get the right insurance.
The author is the Co-Founder and Director at Policy Ensure.
[Disclaimer: The opinions, beliefs, and views expressed by the various authors and forum participants on this website are personal and do not reflect the opinions, beliefs, and views of ABP News Network Pvt Ltd.]