With reference to motor vehicles insurance in India, which among the following statements is / are correct?
1. Under the Motor Vehicles Act 1988, motor vehicle insurance is mandatory for all new vehicle purchases
2. A third party insurance does not protect the vehicle owner and driver in case of an accident
Choose the correct option from the codes given below:
It is mandatory under the Motor Vehicles Act 1988 to get your car insured as soon as you purchase it.There are two types of car insurance: ‘Third Party Insurance’ and ‘Comprehensive Insurance’. Third party insurance protects a policy holder against losses which arise due to bodily injury/death to a third party or any damage to its property. It is mandatory by law to have third party insurance. However this insurance doesn’t protect you against losses which arise due to bodily injury/death to you, your vehicle and co-passengers. If you want to be compensated for any damages to you, your co-passengers and your vehicle in addition to third party coverage, then purchase comprehensive car insurance. Comprehensive car policy is better as it provides both third party coverage and damages/loss to one’s own vehicle, co-passengers or self.
This question is a part of GKToday's Integrated IAS General Studies Module