Costly proposal: 50 pc hike in motor insurance premium in the offing
New Delhi: The Insurance Regulatory and Development Authority of India (IRDAI) has proposed up to 50 per cent increase in insurance premium for cars, motor cycles as well commercial vehicles from April 1.
However, there is no proposal to increase the third party motor insurance premium for small cars (up to 1,000 cc) from Rs 2,055 currently. The hike proposed in mid-segment cars (1,000 - 1,500 cc) as well as bigger cars and SUVs is 50 per cent. The proposal is to increase premium to Rs 3,355 for cars up to 1,000 cc and Rs 9,246 for bigger ones.
Also, no change has been proposed for two-wheelers having engines up to 75 cc. However, for sports bikes and super bikes (more than 350 cc), Irdai proposes to increase the premium to Rs 1,194 from the present Rs 796, up 50 per cent.
Increase has also been proposed for entry level bikes (77-150 cc) and performance category (150-350 cc). Insurance Regulatory and Development Authority (Irdai) has released exposure draft on premium rates for motor third party insurance covers for the financial year 2017-18 and invited stakeholder’s comments till March 18.
Motor third party insurance is mandatory for vehicles. The rates are revised each financial year. Similarly, an up to 50 per cent hike in premium rates have been proposed for different categories of goods carrying vehicles.
The regulator proposes to increase the premium for tractors up to 6 HP from Rs 510 to Rs 765.
In case of vintage cars, it has proposed a discount of 25 per cent. A car is certified as vintage car by Vintage and Classic Car Club of India. Irdai also proposes to increase premium rates for e-rickshaw.
It said the proposed premiums for the next fiscal have been calculated on the accident related data from 2011-12 to 2015-16 provided by the Insurance Information Bureau of India (IIBI).