One of the most misunderstood financial instruments is insurance. For instance when one has motor insurance they tend to think that the policy covers for every possible risk that the car is exposed to. So, it was least surprising to come across a query posted to us recently, where this gentleman wanted to know whether the policy will pay for damages to the car caused by his daughter, who has a learner’s license who smashed the car against a pavement. As the car is on his name, his apprehensions were valid if the insurer would pay the claim.

First things first; third party cover or liability only cover in a motor insurance policy covers compensation payable to any third party i.e. person other than insured and insurance company, for damage to its property (moveable or fixed) by the insured vehicle. For filing of this claim, the person driving the car should be holding a valid driving licence and should not be under the influence of intoxicating liquor or drugs.

In case the person driving the car at the time of accident is holding a learner’s driving licence two conditions must be satisfied for admission of claim. One, at the time of the accident, the vehicle must have displayed “L” plates both in front and in the rear of the vehicle and secondly one person holding permanent license should be sitting besides the learner. Once these conditions are met, the insurance company will settle the claim of the shop owner. The liability of the claim in these cases is to be determined by a court.

Safety check

It is common for those who are learning to drive to move around in their cars without knowing the fact that they are not following the proper rules and regulations. It is necessary that a learner, however proficient they may be should have with them someone sitting in the car with a valid license. There are many reasons for this other than legal, which goes under appreciated. Someone who knows to drive with a valid license would be able to instruct the learner as well as step in to take charge in case of emergencies. It will also help to avoid situations where an otherwise genuine insurance claim may go unclaimed or be rejected.

olmdesk@outlookindia.com