Commercial Vehicle Insurance Add-On Covers

What are Commercial Vehicle Insurance Add-On Covers?

A commercial vehicle insurance add-on is an optional coverage that increases the coverage for various uninsured vehicle components. These covers are not included in the basic commercial vehicle insurance policies but can be selected as per requirements and budget.

Anyone who opts for a comprehensive commercial vehicle insurance can opt for add-ons to safeguard expensive accessories, avoid depreciation deductions during claims, or personal accident protection for owners and drivers. Add-ons provide the much-needed layer of security which are especially useful for goods-carrying and passenger-carrying vehicles.

List of Top Add-On Covers for Commercial Vehicle Insurance

Here are some of the most common add-on covers with a commercial vehicle insurance:

1. Zero Depreciation Add-On Cover

   The zero depreciation add-on cover is ideal for commercial vehicle owners who want a better reimbursement during claim settlement without any deductions for depreciation. Usually, insurers deduct depreciation cost on replaced and repaired vehicle parts, such as plastic, rubber, metal components, and more, while processing claims. The depreciation cost significantly reduces the claim amount. With this add-on, the commercial vehicle insurance company pays the entire cost of the replaced parts, ensuring that policyholders have to bear minimal expenses on their own. It is particularly beneficial for newly purchased vehicles, heavy-duty commercial vehicles, or those that are frequently used and incur wear and tear.

2. IMT 23 Cover

   The IMT 23 add-on provides coverage for parts of the commercial vehicle that are typically excluded from standard commercial vehicle insurance. This includes uninsured body parts, such as tyres and tubes, lamps, mudguards, side parts, bonnet, bumpers, headlights, and even the paintwork of the damaged section. With this add-on, the insurer compensates for damages to these parts after deducting the applicable depreciation costs. Without this add-on, vehicle owners would have to bear the entire expense themselves. It is apt for vehicles that are at a higher risk of damage due to heavy use or rough road conditions.

3. Electrical and Non-Electrical Accessories Cover

   The accessories add-on cover for commercial vehicles provides coverage for additionally-fitted electrical and non-electrical accessories. It covers damages caused to electrical accessories, such as fog lamps, air conditioning systems, entertainment units, etc. It also protects non-electrical accessories like seat covers, bumpers, or external fittings. It is a beneficial cover for passenger-carrying commercial vehicles, where such installations are common.

4. Personal Accident (PA) Cover

   This add-on offers financial compensation in the unfortunate event of injury, death, or disability of the owner-driver due to an accident involving the commercial vehicle. The add-on is very valuable due to the high risk associated with commercial vehicles and can be purchased even with a third-party commercial vehicle insurance. As per the IRDAI guidelines, every individual commercial vehicle owner must mandatorily opt for this cover, unless they already have a valid PA policy of at least ₹15 lakhs. The PA Cover for Owner-Driver is available only to individual vehicle owners and offers compensation in case of disablement or death resulting from a road accident. Policyholders can add a personal accident cover for paid drivers, conductors, and even cleaners to cover any damages caused to them due to the insured vehicle.

5. Roadside Assistance Cover (RSA)

   The RSA add-on cover is extremely beneficial as it offers help 24x7 in case the insured commercial vehicle breaks down anywhere and anytime within the prescribed geographical limit of the policy. It offers essential services, such as towing, fuel top-ups, battery jump-start, flat tyre assistance, on-spot repairs, lost key replacement, etc. It is a valuable add-on for commercial vehicles as it provides assistance in the case of emergencies in the middle of the road, providing peace of mind to the insured.

6. Consumables Add-On Cover

   Accidental claims can be very costly, as a standard policy does not reimburse for several parts and fluids. The consumables add-on cover offers coverage for common parts required during a vehicle repair, such as engine oil, nuts, bolts, lubricants, etc. This add-on helps to reduce out-of-the-pocket expenses, ensures a better claim amount, and helps to cover unexpected expenses.

7. Geographical Area Extension (IMT 1)

   The IMT 1 add-on cover with commercial vehicle insurance helps policyholders extend the prescribed area of coverage. The IMT 1 or geographical area extension helps to cover damages caused to the insured vehicle in neighbouring countries of India, such as Bhutan, Nepal, Bangladesh, etc. It offers protection against losses caused by natural disasters, accidents, collisions, etc.

8. Towing Add-On Cover

   The towing add-on cover with a commercial vehicle insurance policy helps to cover the additional cost of taking the insured vehicle to the nearest garage in case of a breakdown within a specific radius, as prescribed in the policy wording. It provides immediate assistance in case of breakdowns and is quite cost-efficient. Policyholders can purchase this add-on with the roadside assistance cover to also include other services like on-spot repairs, battery jump-start, and more.