Importance of Commercial Truck Insurance For Your Business
After a sluggish start in 2021, the trucking industry is looking forward to better opportunities and more open market access for 2022.
The global pandemic taught us the importance of being prepared for adverse health conditions, i.e., having comprehensive Health Insurance. And, the trucking industry has a lot to learn from it.
Get your vehicle secured with comprehensive truck insurance from unforeseen adversities.
So, in today’s topic, we will discuss commercial truck insurance in detail.
Before we get to the heart of the story, let’s read some data points about India’s logistics and the trucking industry to understand the impact it creates.
Amongst all the modes, rail and road transport are the most significant. Road transport holds a substantial share of 65% compared to road and rail.
One of the primary reasons is its flexibility to extend to any location across the country and provide door-to-door service.
Thanks to the continuous expansion of connectivity via road.
Currently, this ever-growing transport sector offers employment opportunities to 22 million (approx.) of the population, from freight operators to transporters to humble truck drivers.
Approximately 8.5 million trucks of all shapes and sizes run across different parts of the country. Out of that, most of them are family-owned and driven by owners or their relatives.
It shows our trucking industry is just more than an excellent mode of freight transportation, providing income for livelihood for millions of people.
So, if your vehicle is a critical component of your livelihood, you definitely will not want anything happening to it that obstructs your business operation.
In that case, buying commercial vehicle insurance is the answer to securing your vehicles and taking care of the bills arising from any unforeseen adversity when your vehicle is ferrying on the road.
Whether you own a truck or a fleet of trucks, insurance is essential to absorb those financial burdens.
A truck insurance policy covers all types of commercial trucks – mini, light, medium, and heavy-duty trucks.
There is no one size fits all insurance model for commercial trucks. Even though you can have basic truck insurance, it may not provide comprehensive insurance cover to your vehicle.
Classification of Commercial Truck Insurance
Depending upon the level of coverage, there are two types of commercial truck insurance:
- Liability Only Truck Insurance
- Comprehensive Truck Insurance
Liability Only Truck Insurance:
This is the most common insurance type availed by truck owners in India. It is also called third-party liability insurance. It covers any damage caused by the insured vehicle to a third party. Therefore, this insurance covers damages incurred to the third-party vehicle and a person.
Along with that, it also offers personal accident cover for the owner/driver of the truck.
Comprehensive Truck Insurance:
This type of insurance is a complete solution to the insured truck and the owner/driver, along with covering the third-party liabilities in case of any damages.
It financially covers the insured truck from the damages caused due to fire, accidents, theft, natural disasters, etc.
Check out the infographics to understand the difference between Third-party liability only truck insurance and comprehensive truck insurance
Third-party liability only truck insurance
Comprehensive truck insurance
Third-party person or vehicle damage caused by the insured truck
Third-party person or vehicle damage caused by the vehicle being towed by the truck
Personal accident cover for owner-driver of the truck
Own damage cover
List of Beneficial Features Of Commercial Truck Insurance
By availing a commercial truck insurance policy, the insurer can get to access a variety of features. Some of them are
1.Cashless Vehicle Assistance/Repair: You can get your truck repaired at any of the network garages of the insurer without having to spend from your pocket. This feature comes in handy while ferrying goods to a different state or city.
2.Insurance Claim Assistance: When it comes to any motor vehicle, accidents tend to happen than never. In that time of need, the truck owner can contact the support team of the insurer at any time for claim assistance. Getting their help at the right time will help register the claim successfully and stay at ease.
3.No Claim Bonus: If the truck’s insurer hadn’t made any claim for the previous policy period, the insurer could avail of the discount on the commercial truck insurance cost with No Claim Bonus (NCB)
4.Add-on Insurance Cover: As I said before, there is no one size fits all model when it comes to insurance. Every fleet owner / single truck owner have varying requirement of what needs to be covered under their insurance.
It is necessary to take stock of your condition and choose the policy with add-on covers per your need.
Though add-ons come with extra cost, it will be completely worth it at the time of need. Some of the add-ons cover include Zero-depreciation cover, roadside assistance cover, etc.
If you are still not convinced and looking for some solid reasons to buy a truck insurance cover.
Key Reasons To Buy Commercial Truck Insurance
1.Legal mandate: In India, as per the Motor Vehicle law, it is legally mandatory to have a valid third-party liability insurance policy for all the trucks plying on Indian roads.
If you fail to have truck insurance, you can be penalized under the law.
2.Mitigate Financial Losses: All trucks are used for commercial purposes, which means it’s most often plying from one place to another. In such cases, damages or losses incurred to or by the truck can be of major financial burden. To avoid monetary loss, it is wise to buy the best truck insurance that suits your need.
3.Prepare for Unforeseen Circumstances: While your truck is on the road, accidents are an unavoidable part of the business. Accidents or emergencies come unannounced. When it happens, it does not just damage your vehicle but also leads to loss of life.
In such cases, comprehensive truck insurance will adequately prepare you for any unfavorable circumstances.
List of Things Covered Under Commercial Truck Insurance
Before you choose commercial truck insurance for your vehicle, it is necessary to know what things can be covered under a policy.
1.Accidents: Damages caused due to accidents to the insured vehicle are covered.
2.Natural Calamities: Extreme climatic conditions and calamities like floods, lighting are regular occurrences these days.
3.Theft and Vandalism: It is a matter of great shock when a truck goes non-existent (theft) or gets smashed into pieces during unfortunate circumstances. It is always of great relief to have your losses covered under an insurance policy during these instances.
4.Personal Accident Coverage: Just like insuring your vehicle, having personal accident coverage to take care of the owner-driver in case of injury or death due to accidents is of great importance. You can get this covered under commercial truck insurance.
5.Third-party losses (Personal & Property): In case of your insured vehicle causes any damage to the third-party vehicle or person, your liability insurance coverage will come to the rescue to take care of the financial need.
6.Towing Disabled Vehicle: In the case of heavy-duty trucks, your commercial truck insurance covers the damages caused to the third-party vehicle by the insured vehicle.
List of Things Not Covered Under Truck Insurance
As discussed above, truck insurances are good enough to save yourself, and your vehicle from unforeseen adversity, but not all adversities can be covered under commercial truck insurance.
In such cases, it is wise to know the list of exclusions from the truck insurance coverage.
1.Driving without a valid license: Whenever an owner-driver is on the road, it is important to have a valid license in hand. If not, you will have to pay the penalty for your negligence and along with that, you will not be able to claim your insurance for the losses you have suffered.
2.Contributory Negligence: Any kind of damage or losses incurred due to contributory negligence will not be covered under the insurance.
Example: If you are driving your truck despite the flood and any mishap happens. In that case, an insurance claim cannot be made.
3.Drunk Driving: If the truck driver is driving the truck under the influence of alcohol, in such cases, any damage that happens to the vehicle or himself will not be covered with the insurance. Such claims will be rejected.
4.Consequential Losses/Damages: If any damage or loss happens to your truck that has not been directly linked to an accident of any kind, then your insurance coverage cannot be put to use to make up for the losses incurred.
Example: If you damage your truck due to mishandling of the vehicle post an accident.
Now, you have a clear idea of under what circumstances one can claim insurance.
Let’s plunge into one of the topics I introduced earlier – Add-on Insurance.
Add-on insurance cover costs extra than the default truck insurance, but add-ons, as the name suggests, come with an enhanced insurance feature under your policy. It gives you and your truck some extended coverage, which wasn’t originally part of your default insurance plan.
Let’s see a list of add-on covers offered by commercial truck insurance:
As a truck driver/ owner, any incident that goes against your trip plan is an emergency. Common emergencies that require a fix are flat tires, battery assistance, minor repairs, fuel assistance, towing facility, etc.
For all the issues mentioned above, roadside assistance/ support will be or great support at the time of need. If you have this add-on under your insurance cover, it is like adding extra muscle power to your business. It’s worth considering it.
2.Gearbox and Engine Protection Cover:
As the anime suggests, this policy provides coverage specifically to your truck engine and gearbox during any consequential damages.
3.No claim bonus protection:
This is an additional cover that comes on top of the original No Claim Bonus which would be covered in your comprehensive truck insurance.
It means, even if you have made an insurance claim in a particular year, still will e be eligible to make an NCB claim.
4.Zero Depreciation Cover:
It ensures that you get the full claim amount without any deduction related to your truck depreciation due to age/repair and replacement of parts.
5.Loss of Revenue Cover:
This protection add-on will cover the loss incurred during this period in which your vehicle is under repair/maintenance in the garage.
Once you have insurance for your vehicle, you are good enough to conduct your business without worrying about the possible financial burden that arises out of adverse conditions.
If anything happens, you need to make cashless truck insurance claims. Here are the steps to follow:
Steps To Follow For Cashless Truck Insurance Claim
- As owner-driver, you need to inform about the emergency incident to the insurance company immediately.
- Make sure your insurer conducts a physical inspection of the truck to assess the nature of the incident and claim.
- Get the estimate from the network of garages authorized under your insurance.
- Get the estimate from the insurer and repair your vehicle.
- Post-repair, submit the bill to the insurance company, fill up the claim form and submit all other required documents.
- Finally, your bill amount will be directly settled with the network of the garage.
List of documents required to make a truck Insurance claim:
1.Registration Certificate of the truck.
2.Original loss estimate
3.Original repair bill
4.Final receipt of repair bill
5.Police FIR copy, in case of third-party liabilities
6.Car keys and Non-traceable certificate, in case of theft.
To wrap it up
When your life and your family’s livelihood depend on a truck or a fleet of trucks, then you need to take all necessary precautionary measures to safeguard it. – Insurance is the best way to do it.
Insurance can help you run your trucking business smoothly and keep you away from your financial burden.
Never let your journey make an unnatural halt – be it your business or life.