Installing CNG kit in diesel car attracts additional premium

Published in Mint on October 30th, 2013, Written by Kapil Mehta

Some insurers may ask you to have the CNG kit registered on the vehicle’s RC.

I plan to install compressed natural gas (CNG) system in my diesel car. My car is insured. Will the cover be enough?
—Dhruv Mahajan

The existing cover will not be enough. You must notify the insurer who will charge an additional premium. The premium is typically 4% of the CNG kit value and about Rs.60 more towards liability cover. Some insurers may ask you to have the CNG kit registered on the vehicle’s registration certificate.
What charges are levied while switching to a new insurer?
—Kashish Sethi

I am not sure which specific insurance you are referring to—rules can vary depending on the type of insurance. Typically, there are no charges in a general insurance if you shift to a new insurer at the time of annual renewal. If you plan a change during the policy term, then the premium is likely to be refunded based on the short premium scale. For example, if you have had the insurance for less than three months, then only half the premium will be refunded.

I am a fund manager and invest clients’ money in property. Can I insure the risk of a contractor committing fraud?
—Tarun

This particular insurance is not available “off-the-shelf”. However, insurers would be willing to tailor a specific product for you that mitigates third-party fraud. Approach an insurer you are familiar with or an experienced intermediary.

I plan to open a shop that will sell valuables, including jewellery. Can I insure my shop?
—N. Rai

You can purchase an insurance called jeweller’s block. This insurance will cover your shop for all risks such as fire, burglary and theft. It will also insure for burglary when the valuables are being transferred from the warehouse to the shop or back. Standard exclusions to this insurance are theft by an employee or damage at an exhibition outside your shop.

I am a doctor and forgot to renew my professional indemnity insurance on time? Is there a time bar for renewal?
—Bhargav

Most insurers will provide you a new professional indemnity insurance at a price similar to the one that lapsed. However, they are unlikely to provide you the benefit of a prior retroactive date. The retroactive date refers to the period for which an insurer is liable to pay a claim. If the professional indemnity is properly renewed then the retroactive date is the date on which the insurance was first purchased. Consider a case wherein you operate upon a patient this year and the patient sues you two years later. If your professional indemnity is properly renewed for two years, then the claim will be covered.

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