Insurance classification
Insurance purposes generally divide the vehicles into four categories.
(1) Private cars
(2) Commercial vehicles refers to any type mechanically driven vehicle that is used in business or trade. They can be passenger vehicles, goods vehicles, or tractors.
(3) Trade vehicles.
(4) Motor bikes
Rates are set for each classification. Further classifications based on vehicle use are also made for rate-making purposes.
Tariff and Non Tariff Offices
There are two types of insurance companies. The members of Motor Tariff Association, or ‘Tariff Offices,’ are called “Tariff Offices” and the non-members of the Tariff Association, are called “Non Tariff Offices”. The majority of these companies are tariff offices. The Tariff Association regulates the premium rates and policy conditions for all tariff offices. There is one Tariff Association in Bangladesh for commercial vehicles. However, there are regional tariffs for private cars and motor-cycles. The country is divided into seven sections: Dhaka Rajshahi Chittagong Khulna Sylhet Barisal Rangpur and Chittagong. Any insurance company located in any of these seven divisions must join that regional Tariff Association. Although there are no geographical restrictions on driving vehicles in any particular division, insurance must be applied in that specific division. The same applies to vehicles in other regions. A tariff office within a region can insure them in another region. However, the Tariff Association of the area in which they are located must determine the conditions and the premium.
Types and types of coverage
The following types can be separated from each vehicle policy:
(1) Act Policy
An Act Policy covers all risks that are required to be taken by an owner of a motor vehicle under the Motor Vehicles Act. This Act requires that a policy be taken to cover the insured’s liability for bodily injury or death resulting from the vehicle being used in public places. Act also specifies the maximum amount that a policy must be taken. The Act also requires that a policy be taken to insure against liability for any death or bodily injury resulting from the Workmen’s Compensation Act (1923). This Act applies to employees who drive, are present on, or are transported in motor vehicles. These provisions, along with any exceptions, are all printed on the policy. You should know that insurance is only compulsory for personal injury, and not property damage.
(2) Third Party Policy
This policy covers third-party risks not only as required by law, but also includes risks for the insured that may be covered under common or Fatal Accidents Act 1855. The policy covers damage to third-party property for which the insured is responsible. In addition to compensating the insured, the insurer will also pay all amounts including the costs and expenses of the claimant for which the insured becomes legally responsible.
(3) Comprehensive Policy
Comprehensive policies cover a variety of risks in one policy. These are the most common risks that are covered by the policy. If you need additional coverage, it is possible to add to the risk insurance after paying extra premiums. These are some of the risks that a comprehensive private car policy covers:
(a) Damage or loss to the car. The car, along with the necessary Lamps and Tyres, is covered against damage or loss by fire, explosion or lightning.
(b) Any removal charges relating to the removal of your car from or to the premises of the nearest garage for any accident beyond a certain limit.
(c) Third-party liability refers to risks that are not covered by third party policies.
(d) All costs and expenses that are incurred with consent from the company
(e) Car accident repair costs for which the company is liable up to a certain amount.
(f) Medical expenses up to a specific limit that are incurred due to injuries sustained by the insured, or any occupants of the vehicle.
The insured can also receive additional benefits if they pay extra premiums. These benefits include: (I) death of the insured, alone, or with a spouse and unnamed passengers; (ii) riots or strikes, etc.; (iii] loss of rugs and coats or luggage due to theft, larceny, or f.re.
Commercial vehicles policies aren’t as comprehensive as private cars. There are two main differences: personal accident benefits are excluded and third-party indemnity for property damage is limited to Tk. For any one accident, 20,000 Motorcycle policies are issued in the same way as cars.
You should carefully consider the conditions of each policy.
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