Motor insurance otherwise known as auto cover is one of the mandatory requirements before one is allowed on the road with their vehicle. The Kenyan traffic laws Act 405 makes it a basic requirement for all vehicles on the road to have such cover. The same rule holds in other countries. Getting a good motor insurance cover thus becomes essential. Insurance companies offering motor covers are growing in numbers making it a bit of a challenge to choose the best cover. The players in the motor insurance industry are currently in a state of cut-throat competition.  Some offer genuinely attractive packages while others offer rather questionable deals. The question then is; what makes a good motor vehicle cover?
Why motor insurance?
It is mandatory in most countries’ legal framework. This is majorly because it helps compensate other road users in the event of an accident. The Third Party Policy serves this role. It insures other road users like pedestrians and buildings that might be damaged as a result of the accident. This is the basic form of motor vehicle insurance.
With time however there came the realization of the need to indemnify the vehicle owner in the event of an accident. This is because a vehicle in itself is an asset in which a lot of investments have been put into. It is common knowledge that no one would want to lose an investment no matter the situation. This is why financial institutions have agreed that they be used as collaterals for loans. As an investment therefore, the need for insurance made sense. Motor comprehensive was thus brought in as fall back plan for the vehicle owner in the event of an accident.
What factors are considered when signing up a vehicle owner for a motor vehicle cover?
- The experience of the driver
- Age of the insured. Young persons are still adventurous and tend to involve themselves in highly risky activities hence the need to take note of the age question.
- The insurance history of the vehicle. How often has the vehicle been involved in accidents and claims made?
- The condition of the vehicle. Evaluation has to been done to establish this.
- What activities is the vehicle going to be involved in? Is it for commercial or private purposes?
- Does the vehicle have pre-installed anti theft tracking device?
- What make/model is the vehicle?
When taking up a comprehensive motor cover, what special features should one consider?
Different insurance companies have tailor made their motor vehicle covers in a quest to keep their heads above the water in this overcrowded industry. But as a consumer, one should pay attention to the extra stretch the company goes in the reference to the following;
- Does it include a separate cover the vehicle’s separate parts e.g. wind screens?
- Do they extend their coverage outside the tradition to cover riots & strikes
- Does the cover include ‘special perils’ i.e. acts of God like floods, earth quakes
- While the vehicle is being repaired for damages resulting from an accident does the company offer a courtesy car?
- How much are the excess protector?
- Do they consider the element of ‘no blame no excess’?
These terms mean:
Excess
It is that part of a loss that is borne by the insured. It is normally charged by the insurance company in order to make the vehicle owner be a responsible and careful driver. It saves the insurance company the costs resulting from the driver’s negligence.
No blame no excess
It is a policy abstract that states who to blame for the accident. This basically means that in case the driver is not to blame then they can’t pay the excesses.