Comparing private and commercial car insurance

blog-img

04 Aug 2023

All about Comparing private & commercial car insurance

In an event where your car is damaged, insurance might help you fulfill your financial obligations. Car insurance is crucial for protecting your vehicle from any losses or damages, whether it is a personal or commercial vehicle. Your car insurance should be calculated depending on the risk factor. A commercial vehicle may be used more frequently than a personal vehicle, necessitating specialized coverage for accidental losses or damages.

Continue reading this blog to find out how private and commercial car insurance plans are different, as well as the variables that influence each.

Private car insurance

Private Car Insurance refers to the insurance policy that protects a vehicle you own and use only for personal purposes. Comprehensive insurance is the most preferred insurance policy among vehicle owners because it contains own-damage insurance and third-party liability along with the facility to add other riders as per the requirement.

Commercial car insurance

Vehicles used for business purposes are covered by a special kind of insurance called commercial car insurance. As it contains additional risks, the type of insurance coverage under this group is significantly different. They include the driver, the passengers, and the regular financial coverage for car damage. Due to the potential effects on your business, getting insurance for your passenger vehicle or taxi becomes even more crucial.

Difference between private car insurance and commercial car insurance

Particulars

Private Car Insurance

Commercial Car Insurance

Coverage

Financial protection against theft, fire, natural disasters, riots, etc.-related losses or damages. Own-damage personal accident and liabilities to third party’s coverage.

Offers financial security against any commercial losses brought on by the commercial vehicle under insurance. Protects drivers, with optional passenger protection. It also covers losses caused by accidents, fire, natural disasters, theft, third-party, and other events.

Premium

Lower owing to fewer kilometers driven by the personal vehicle. Reduced premiums as compared to commercial car insurance.

Higher as a result of the commercial car driving more kilometers and increased insurance premiums.

Mandatory coverage

Third-party liability

Third-party liability, Driver & Passenger cover

Claim documents

The documents required include the driver's license, registration certificate, First Information Report (if applicable), a copy of the insurance policy, receipts for cash reimbursements, and the original repair invoice.

When filing a claim for commercial car insurance, you may need to provide the insurer with various documents, including your vehicle permit, load challan, trip sheet, fitness certificate, a copy of the First Information Report (FIR), your car's registration certificate (RC), your driving license, and tax records.

Claim process

While making a claim for private car insurance, it may not be obligatory to conduct a spot survey of the vehicle or file a First Information Report (FIR). Nevertheless, the specific process for filing a claim can differ among insurance providers.

When registering a claim for commercial car insurance, it may be necessary to file a Police First Information Report (FIR) and undergo a mandatory spot survey conducted by your insurer. Nonetheless, it's important to note that the precise claim procedure can differ among insurance companies.

Is it possible to change a commercial car insurance policy to a private car insurance policy?

Yes. Your insurance policy for commercial vehicles can be changed to a private motor insurance policy. Nevertheless, in order to do so, you must legally turn your car into a private one. Also, you might need to visit your regional transport office to register your automobile as a private vehicle. The car is often checked by authorized personnel during the conversion procedure.

Both private and commercial car insurance policies are uniquely created to accommodate two distinct car usages, business and personal. Insurance premiums and coverage are often higher for commercial car insurance. So, you must choose a personal car insurance plan if you just use your four-wheeler for personal purposes.

While there are several car insurance policies on the market, a person must invest some time and energy into determining which coverage best suits his or her needs. It doesn't matter if you get car insurance online or offline; just make sure you compare prices to get the best offer.

Related Blogs
Car Insurance Against Cyclone Damages
Difference Between First Party vs Third Party Car Insurance
Car insurance for CNG cars


author-img
Team Kotak GIC

The content of this blog has been created and carefully reviewed by the esteemed team at Kotak General Insurance, with the sole purpose of providing valuable guidance and sharing insights on the importance of general insurance. Our objective is to assist users in making informed decisions when purchasing or renewing insurance policies for their cars, bikes, and health. Our expertly curated information aims to empower our readers with the knowledge they need to protect their valuable assets and financial interests.