Motor Insurance Explained
Published on July 19, 2026 • 4 min read
While third-party motor insurance is mandatory by law in India, understanding the different types of coverage can save you from massive financial losses in case of accidents, theft, or natural disasters.
Third-Party vs. Comprehensive
Third-Party Cover: This only covers damages or injuries you cause to others. It does not pay a single rupee for the damages to your own vehicle.
Comprehensive Cover: This covers third-party liabilities AND damages to your own vehicle due to accidents, theft, fire, or natural calamities like floods.
The Importance of Zero Depreciation
Normal comprehensive policies factor in the depreciation of your vehicle's parts (like plastic, glass, rubber). If you have an accident, you will have to pay the depreciated amount out of pocket. Adding a "Zero Depreciation" (or Bumper-to-Bumper) add-on ensures the insurer pays the full cost of replacing parts without deducting anything for depreciation.
Return to Invoice Cover
If your car gets stolen or totally damaged, standard insurance only pays the current market value (IDV), which is much lower than what you paid for the car. "Return to Invoice" cover ensures you get the exact original on-road price back.