Policies are an essential aspect of society. They give support in times of need. For this reason, various government organizations and private business entities have created different policies to provide support at bad times.
It helps individuals and businesses to recuperate their loss, and they can start the beginning of life afresh.
CPM and Motor are two specific policies that give individuals and contractors the required support in their time of need. An individual’s vehicle is one of his topmost assets and liabilities. Similarly, for a civil contractor, the equipment and machinery are his most significant asset and liability.
Key Takeaways
- CPM policy stands for Comprehensive Policy for Mobile, while Motor policy is a type of insurance policy that provides vehicle coverage.
- CPM policy covers damage or loss to mobile phones due to factors like theft, accidental damage, and fire. In contrast, the Motor policy covers vehicle damage or loss due to accidents, theft, or natural disasters.
- CPM and Motor policies are insurance policies that protect against unexpected events but cover different types of assets.
CPM Policy vs Motor Policy
The difference between CPM Policy and Motor Policy is that CPM Policy is a system of insurance that takes care of the claims arising from an accident. Motor Policy is a system of insurance that takes care of the liabilities or penalties arising from the accident.
Comparison Table
| Parameter of Comparison | CPM Policy | Motor Policy |
|---|---|---|
| Intended for | Contractor’s equipment and machinery | Engine-powered motor vehicles |
| Covered objects | Cranes, Rollers, Excavators, Dumpers, Drilling Machines, Earthmovers, etc. | Car, two-wheelers, commercial vehicles. |
| General Coverage | Accidental and weather damage to the machinery & equipment. Malicious Damage from theft, burglary, riot, terrorism, etc | Accidental damage to the vehicles and victims. Malicious Damage like theft, burglary, and loss of the car. |
| General Exclusions | Negligence against the equipment, damage due to war or warlike commotion, general wear and tear, etc. | If the vehicle was used for any illegal activities, If the driver’s license becomes invalid, or during the time of the accident, if the driver remained influenced by alcohol |
| Requirement | CPM policy is not mandatory in every state. | The motor policy is mandatory in every state. |
What is CPM Policy?
An insurance policy that covers the contractor’s part and machinery is universally known as a CPM policy. This insurance policy is a financial safeguard for plant and machinery damage.
This insurance policy offers financial security for various equipment and machinery like cranes, rollers, excavators, dumpers, drilling machines, earthmoving equipment, etc.
Generally, the CPM policy covers various types of accidental damage. It may include fire, earthquake, collapse, collision, impact, flood, storm, inundation, water damage, etc.
Alongside these damages, the CPM policy also covers various types of Malicious Damage like theft, burglary, riot, terrorism, etc.
Due to a few reasons, the insurance term can be voided. These general exclusions are willful acts or negligence against the equipment, damage due to war or warlike commotion, general wear and tear, Rust, lack of use, etc.
In these conditions, the insurance company may refuse to provide financial coverage on the contractor’s part and machinery.
The contractor can extend the CPM policy on certain things with an additional premium. It may include surrounding property of the owner, derby clearance, express freight, third-party liability, etc.
Even though the CPM Policy benefits the contractor, it is not mandatory for every state. The contractor can choose the policy according to his project location.
What is Motor Policy?
The objectivity of motor policy is to give vehicles financial protection from physical damages & loss which occurs from accidental and natural calamities. This insurance policy covers cars, two-wheelers, and commercial vehicles.
Usually, the motor policy gives financial protection to vehicles from road accidents, fire, theft, burglary, riot, flood, earthquake, etc. Alongside these damages, the motor policy covers third-party liabilities, health, and death-related compensation.
The motor policy insurance can be voided under a few circumstances.
The insurance company may refuse to pay for the damage if the vehicle is used for illegal activities, If the driver’s license becomes invalid, or during the accident if the driver is influenced by alcohol or drug abuse.
Few insurance companies also offer additional benefits to motor policies. In exchange for an additional premium, they offer depreciation cover, engine protection cover, road assistance, towing, and a cashless network garage.
According to the law of various government agencies, motor policy insurance is mandatory for every state. Driving a vehicle without valid motor policy insurance can be charged with a criminal offence.
Main Differences Between CPM Policy and Motor Policy
- The CPM policy is an insurance system for civil contractors and their machinery, whereas the Motor policy is an insurance system for vehicle owners.
- The CPM policy cover contractor’s equipment and mercenaries such as cranes, rollers, excavators, dumpers, drilling machines, earthmovers, etc. The Motor policy covers the insured car, two-wheelers, and commercial vehicles.
- General coverage against CPM policy is fire, water damage, accidental damage, theft & burglary, etc. On the other hand, the Motor policy gives insurance coverage for third-party liabilities, road accidents, death, loss of vehicle, etc.
- Exclusions from CPM policy are willful negligence against the equipment, damage caused by war, and general wear & tear. Exclusions from the motor policy can happen if the vehicle is used for any illegal purpose, if a void driving license is, or if the driver remains influenced by alcohol or drugs at the time of the accident.
- Around the world, the CPM policy is not mandatory everywhere; in many states, it is optional for contractors. However, in most states, the motor policy is mandatory, and the driver must have legitimate vehicle insurance.
- https://allidealinsurance.blogspot.com/2011/08/what-is-cpm-insurance.html
- https://www.policybazaar.com/motor-insurance/
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Piyush Yadav has spent the past 25 years working as a physicist in the local community. He is a physicist passionate about making science more accessible to our readers. He holds a BSc in Natural Sciences and Post Graduate Diploma in Environmental Science. You can read more about him on his bio page.
