Motor insurance got recently a great momentum. In
the older times, personal, who were injured or killed through the negligence of
the motorists, could not get financial redress either to them or to there legal heirs because no scheme of
insurance was present at that time. To mitigate the financial hardship caused to
the persons, the Motor vehicles Act. 1939, as amended from time to time, has
made it compulsory for the motorists to insure against the risk of liability to
third parties.
The rate of premium is standardized because the
business is tariff. No insurer can charge lower rates then the tariff rates
& no insurer can grant benefits exceeding than those prescribed by the
tariff.
Vehicles for the purpose of insurance are
classified as below:-
(i) Private Cars (not used for carrying passengers
for hire or reward).
(ii) Commercial vehicles such as goods carrying
vehicles, passenger vehicles, tractors & others.
(iiI) Motor cycles, scooter & auto cycles. 
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