Tractor Insurance: Coverage, Claim & Exclusions

Updated: 26-10-2022 13:20:58 PM

In India, a tractor is a key asset for people who are associated with farming. Any damage to the vehicle can lead to big financial losses for these people. Thus, it is important to protect the tractor against all possible damage and other risks. This can be done through a tractor insurance.

What is Tractor Insurance?

A tractor insurance is a type of commercial vehicle insurance that provides a comprehensive coverage to the insured vehicle and third parties. The Own Cover section protects the tractor and the owner of the tractor from external damage like burglary and theft. Commercial tractor and farm tractors are insured under different categories of Motor Vehicles Act. Third-party liability compensates any loss or damage to another vehicle or person due to the insured tractor.

What Tractor Insurance Covers?

Tractor insurance safeguards the vehicle from all possible damage and risks. Following are the coverage offered.

• Damages or loss to the tractor due to natural calamities like floods, earthquake, fire, and landslide, etc.
• Personal Accident Cover for the owner, driver and the passengers of the tractor
• Covers risks, such as theft, accidents, burglary, strikes, riots, etc.

Eligibility Criteria

The policy term for tractor insurance policy is one year and the sum insured depends on the Insured Declared Value (IDV)

Claim Process  

In case of an accident, or theft of the tractor or its damage, you need to file claims immediately to reap the benefits on time.

• The policyholder needs to submit basic details like Insurance Policy Number, the name of the insured and contact details
• Along with it, one also needs to gather details related to the vehicle, including the location where the loss or damage to the vehicle has occurred, registration number of the vehicle, and the current location of the vehicle for inspection, etc.
• More legal aspects of the situation will be explored by the insurance company, including details of the police station if informed already, the name of the driver, brief description of the event and names of the persons injured/dead or any claims that may arise due to third-party intervention, etc.
• If approved, the claim amount is credited to the claimant’s account

Documents Required for Claim Process

Once the FIR is shared with the insurance company about the tractor, the company requests the policyholder for the submission of below-mentioned documents to process the claim:

• Claim Form duly filled and signed by the policyholder
• Copy of Registration Certificate, Driving License, FIR copy, Original Repair or Replacement Bills, etc.
• Photographs of the damaged vehicle, Subrogation, Discharge Voucher from the garage, etc.

Exclusions 

Below are some of the exclusions where the insurance company is not liable to pay:

• Normal wear and tear of the tractor due to use
• Losses incurred by the farmer due to depreciation of the tractor
• Mechanical, electronic, and electrical breakdown in the tractor which is not covered in the insurance policy chosen by the farmer
• Improper usage of the vehicle for which they are not permitted under guidelines
• Damage or loss incurred by the farmer or the tractor owner if he/she does not have a valid driving license
• In case, the tractor driver is intoxicated or under the influence of drugs and other external substance, etc.

Time Taken to Settle Claims

After all the basic documentation is collected from the policyholder and internal processes of the insurance companies are completed to validate claims, then the claims are processed on the name of the beneficiary. There are two scenarios in which the claim amount is disbursed by the insurance company and these are:

1. If the tractor is repaired in the Network Garage, then both cashless and non-cashless reimbursements are provided and payments will be made to the tractor garage
2. For non-network garages, the policyholder is reimbursed within 7 days directly to his/her bank account

Renewal Process 

One can renew Tractor Insurance policy online by logging into the provider home page and entering the required details of their tractor. Apart from it, the insured can also renew their policy by visiting the branch and give the renewal notice and cheque to the branch office.

Insurance Companies offering Tractor Insurance in India

Some of the insurance companies offering tractor insurance in India are as follows:

• HDFC ERGO
• IFFCO Tokio
• SBI General

Important Aspects

Certain points need to be kept in mind before buying the plan or while filing the claims. Let us look at some of them:

• All the policies have mandatory third-party liability cover as per the guidelines of the Motor Vehicles Act
• The insured needs to intimate the company before removing the vehicle from the spot in case of an accident so that the insurance company can arrange for spot inspection of the damage
• In case of injury, death and third-party damage, immediate intimation to the police station should be done

Advantages of Tractor Insurance

There are numerous benefits that farmers can avail from the tractor insurance policies offered by either the government or private insurance companies in India. Below are some of the benefits:

• The policy also covers damage or loss to the tractor itself in the event of any accident
• Some companies have options of adding Riders to the policy and providing additional legal liabilities towards the paid driver and an employee
• Bi-fuel kits like CNG or LPG, electrical, and electronic parts are also insured at an extra cost
• No Claim Bonus is also provided to the tractor owner as a discount for not making a claim in the previous policy year
• Some private insurance companies also provide cashless claim facility at hundreds of pre-approved garages including the authorized service centers of the tractor manufacturer in various cities

FAQs

Q1. What decides the premium for tractor insurance?

The insurance company considers the following factors to finalise the premium:

• Insured declared value
• Type of vehicle
• Age of the vehicle
• Place of registration
• Fuel type

Q2. What is no claim bonus?

It is a discount which is given in case there is no claim made by the insured during the previous policy year. No claim bonus or NCB is usually given at the time of renewal of the policy.

Q3. Is Tractor Insurance available online?

Yes, Tractor Insurance is available online on IIFCO-TOKIO official website where individuals can purchase the policy.

Q4. Is it mandatory to purchase Tractor Insurance Policy?

Under Motor Vehicles Act, 1988, it is mandatory for individuals to own an insurance policy for the vehicles, at least a Third Party Liability coverage.