Just bought a new car? It is the high time for you to know details about car insurance or motor insurance. Because is forbidden in Bangladesh to drive without any motor insurance. So, it is mandatory for every car owner to know the pros and cons about car insurance. If you have any insurance against your vehicle then your vehicle is financially protected.
What is Car insurance?
Motor insurance, also called automotive insurance is a contract by which the insurer takes on the risk of any damage the owner or operator of a car may suffer through damage to assets or persons as the consequence of an accident. In Bangladesh, third party motor insurance is mandatory for the car owners. Because, if there is any accident or loss which is made by the car; the car owner is the liable person for that loss.
Different types of Motor insurance:
There are only two types of Motor insurance policy in Bangladesh.
1. First party insurance policy (Comprehensive Motor Insurance )
2. Third party motor insurance policy.
First party or Comprehensive motor insurance policy
First party or Comprehensive insurance is an non-compulsory motor insurance treatment that protects your car in contradiction of loss not resulting from an accident, as well as from theft. It covers a wide range of actions that can harm your car, including wreckage, fire. The premium rate of this insurance policy is fairly high.
Third party motor insurance policy
Third party Car insurance in Bangladesh is a common phenomenon for the car owners. In comprehensive insurance policy, 3rd party is not engaged in the agreement concerning the car owner and the insurance company. Insurance coverage confirms that the insurer will compensate losses incurred by the driver towards losses the driver may bear due to a claim by a third party. Basically If there is an occurrence relating to you, a different person if they were driving your car, third party car insurance will give you cover for any claim that may be made towards your insurance.
What do the Car Insurance policy covers?
Now, let’s take a look at what do the insurance policies cover
Comprehensive Policy (What it Covers):
- Explosion, self-ignition or lighting.
- Robbery, house-breaking or theft.
- Riot & strike including malicious and terrorist activities.
- Tremor (fire and shock damage).
- Flood, typhoon, inundation, cyclone, hailstorm, frost hurricane, storm, tempest.
- Accidental outdoor means.
- Whilst in transit by domestic waterway, lift, elevator or air road, rail.
Third party or Act Liability Policy (What it Covers):
- Death : Tk. 20,000
- Grievous Injury : Tk. 10,000
- Minor Injury : Tk. 5,000
- Property Damage : Tk. 50,000
Policy excludes
Not all the losses or damages are covered by the insurance policies. The following damages or losses are excluded from insurance policy.
- Substantial loss
- Decline, wear and tear
- Mechanical and electrical halt, disaster or fracture
- When automobile is used outside the geographical area
- Driven by a individual other than the driver stated in driver´s clause
- War dangers, nuclear perils and drunken driving
Important things you should know before buying car insurance policies.
- The conditions in which the insurance company is giving insurance policy
- Be sure about the insurance policy covers treatment cost in case of accidental injury
- Details of asset security
- In which conditions the insurance company covers the losses excluding road accidents.
It is important for the car owner, driver and passengers to be aware about motor vehicle policies to avoid any kind of loss or damage of asset and life caused by vehicle and natural calamities. Ensure your car’s safety and security after buying it. Insurance does not only protect your car, but also your and passenger’s life and asset.
