🚗 Types of Motor Insurance Policies

1. Third-Party Liability Insurance (Act Only Policy)

• What it covers: Liability for death, injury, or property damage caused to a third party.

• Legal Requirement: Compulsory under the Motor Vehicles Act, 1988.

• Property Damage Limit: Currently limited to ₹7.5 lakh.

• Who needs it: Every vehicle owner (private cars, bikes, commercial vehicles).

💡 Sales Tip: Position this as the minimum legal protection—but emphasize its limitations (doesn’t cover damage to own vehicle).

2. Comprehensive / Package Policy

• What it covers:

  • Third-party liability (as above).

  • Own Damage (OD): Loss or damage to the insured’s vehicle due to accident, fire, theft, flood, earthquake, etc..

  • Optional covers: Personal Accident for owner-driver, legal liability for paid driver, passengers, accessories.

• Best suited for: Customers wanting complete protection.

💡 Sales Tip: Present this as “peace of mind cover”—most valued by customers who want to protect their own vehicle investment.

3. Standalone Own Damage Policy

• Introduced after detariffing in 2008.

• Covers only own damage (accident, natural calamities, fire, theft).

• Needs to be purchased with a third-party cover to comply with law.

💡 Sales Tip: Position for customers who already have TP insurance but want added OD cover for flexibility.

4. Bundled Policies (Long-Term TP + OD)

• Introduced by IRDAI for new vehicles.

  • Cars: 3-year third-party cover bundled with 1-year OD.

  • Two-wheelers: 5-year third-party cover bundled with 1-year OD.

• Benefits: Reduces risk of lapses in compulsory cover.

💡 Sales Tip: Promote as a “set it and forget it” option for new buyers.

5. Specialized Motor Policies

• Fire & Theft Only Policies: Restricted covers for older vehicles where full OD is uneconomical.

• Motor Trade Policies: Cover vehicles under garage custody, testing, or trade certificates.

• Fleet Policies: For corporates with multiple vehicles.

• Usage-Based Insurance (Pay As You Drive): Premium linked to kilometers driven.

• Electric Vehicle Covers: Emerging segment with customized benefits.

💡 Sales Tip: Use these as niche solutions for businesses, fleets, and tech-savvy customers.

6. Add-On Covers (Enhancers)

Customers can boost their comprehensive cover with add-ons like:

• Zero Depreciation (full claim settlement without depreciation cuts).

• Engine Protect.

• Roadside Assistance.

• Consumables Cover.

• Return to Invoice (RTI).

💡 Sales Tip: Cross-sell add-ons to increase policy value and improve customer satisfaction.

Key Takeaways for Sales Managers

1. Start with TP as the legal must-have, then upsell to Comprehensive.

2. Highlight OD & add-ons as protection for customer’s own assets.

3. Leverage long-term policies to reduce renewals hassle and improve persistency.

4. Tailor solutions (fleet, EV, PAYD) for niche clients.

5. Educate customers that insurance is not just compliance—it’s a safety net.
   

✅ In short: Third-Party is the foundation, Comprehensive is the all-rounder, and Add-ons + Specialized covers help you tailor policies. The better you explain the differences, the easier it is to convert a sale into a lasting relationship.