What is MMV in Vehicle Insurance?

What is MMV?

MMV full form in Insurance : Make, Model, and Variant (MMV): This term is used in car insurance to describe the specific details of a vehicle, which are crucial for determining the vehicle's value and, consequently, the vehicle insurance premium.

Why MMV is important?

1. Determines Insurance Premiums: The make (brand), model (specific vehicle), and variant (trim level or features) directly influence the cost of insurance. For instance, luxury or high-performance cars like a Mercedes-Benz or Tesla Model S typically have higher premiums due to their higher repair costs, advanced features, and greater likelihood of expensive claims.
2. Reflects Vehicle Value: The MMV helps insurers assess the market value of the vehicle. Expensive cars or those with advanced features command higher premiums as they cost more to repair or replace in case of damage or theft.
3. Safety Features and Risk Profile: Different models and variants come with varying safety features, crash-test ratings, and theft likelihoods. Cars with better safety ratings or lower theft rates often have lower car Insurance premiums, while those with poor safety records or high theft risks are more expensive to Insure.
4. Customisation and Trim Levels: Variants within the same model can differ significantly in price and features (e.g., standard vs. luxury trims). Insurers consider these differences because they affect repair costs and claims frequency.
5. Claims History: Certain makes and models have higher claims frequencies or severity rates. For example, sports cars may have more accidents due to high speeds, leading to higher premiums for those vehicles.

In summary, MMV is critical for accurately pricing insurance policies, assessing risk, and ensuring adequate coverage tailored to the specific vehicle type. In summary, the make, model & Variant influence Car or Bike Insurance premiums by reflecting the vehicle's value, safety features, potential for theft, and historical claims data. 

Insurers may choose not to provide insurance for certain Makes, Models, and Variants (MMVs) of vehicles due to various risk-related factors. Here are few key reasons:

1. High Risk Profile : Certain MMVs are associated with higher risks, such as sports cars or luxury vehicles, which are more prone to theft, accidents, or expensive repairs. Insurers may avoid covering these vehicles or charge significantly higher premiums.

2. Age of the Vehicle: Vehicles that are older than a specific age (e.g., 10-15 years) or obsolete models that manufacturers have stopped producing may not be insured due to difficulties in determining their Insured Declared Value (IDV) and increased likelihood of mechanical failures. Certain vehicles are newly introduced in the market and Insurer might yet not considered it for insurance (example : Not all insurers provide insurance for EV vehicles)

3. Manufacturer-Specific Issues: MMVs with known manufacturing defects or poor safety ratings might be excluded from coverage due to increased liability risks.

These exclusions allow insurers to manage risks effectively while maintaining profitability and ensuring fairness in premium pricing across different vehicle types.