New Delhi: Third-party insurance premium for cars, two-wheelers and transport vehicles may go up with the regulator Irdai proposing substantial increase in premium rates for the current financial year.
The Insurance Regulatory and Development Authority of India (Irdai) has proposed to increase the Motor Third Party (TP) premium rates for cars below 1000 cc to ₹2,120 from the existing ₹1,850 for the fiscal 2019-20.
Similarly, for cars falling between 1,000 cc and 1,500 cc also, premium is being proposed to be increased to ₹3,300 from the existing ₹2,863. However, for luxury cars (with engine capacity of over 1,500 cc) no change in TP premium has been proposed from the existing ₹7,890.
Normally, the TP rates are revised from 1 April. However, this time, the Irdai had decided to continue with the old rates until further order.
Now, the regulator has come out with a draft of new rates for TP premium for the current financial year. It has sought comments from stakeholders on the proposed rates till 29 May.
According to the draft, TP for two-wheelers below 75 cc is proposed at ₹482, up from ₹427. Hike has also been proposed for those between 75 cc and 350 cc. However, no rate hike has been proposed for superbikes (exceeding 350 cc).
Also, no change has been proposed in the single premium rate -- 3-year for new cars and 5-year for new two wheelers.
The Irdai has also proposed a discount of 15%, on Motor TP premium rates for electric private cars and electric two-wheelers.
It also does not propose to raise TP premium rates for e-rickshaw. However, the rate could go up in case of school buses.
Rate increase has also been proposed for taxis, buses and trucks.
The premium on tractors may also up.
Irdai said the data provided by the Insurance Information Bureau of India (IIBI) has been used for arriving at the Motor TP premium rates and the claims paid data in respect of each of the accident years starting from the year 2011-12 up to 2017-18 has been considered.
Also, gross written premiums for the 2011-12 to 2017-18 have been considered, it added.