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What is the Difference Between Private and Commercial Car Insurance?

What is Private Car Insurance?

What is Commercial Car Insurance?

What is the Difference Between Private and Commercial Car Insurance?

The difference between private and commercial car insurance is listed in the table below:

Category for Comparison

Private Car Insurance

Commercial Car Insurance

Risk Involved

Private cars have lesser risk exposure. Therefore, the premium is also low.

Commercial cars are more exposed to risks and have higher chances of getting into accidents. Thus, the premium is on the higher side.

Legal Mandate

It is mandatory for car owner’s to have a third-party liability cover with their motor insurance policy.

Owners must have a third-party liability cover, a legal liability cover for paid drivers, and a personal accident cover for the passengers.

Cover for Towing Disabled Car

Private car insurance does not cover the charges of any damage caused by the vehicle while being towed to a garage.

The charges for the damages caused by the vehicle while being towed to a garage are covered by the insurance policy.

Premium Rates

The premium rates depend on the cubic capacity. The rates are lower than that of a commercial car insurance policy.

The rate of premium depends on the cubic capacity, vehicle age and the risk involved. It is usually higher than a private car insurance policy.

Documents required to claim the insurance

A copy of FIR (if required), a copy of insurance policy, cash receipts (in case of reimbursements), original repair bill, Registration Certificate, Driving License, and Taxation Book.

FIR, Vehicle Permit, Policy document, Fitness Certificate, Registration Certificate, Load Challan, Driving License, Taxation Book, Permit, Copy of FIR, and Trip Sheet.

Can Private Car Insurance be Converted to Commercial Car Insurance?

FAQs About Commercial Car Insurance vs Private Insurance