Get ready to pay up to 11% more for third party motor insurance

New Delhi: Soon, you may have to pay up to 11% more for your car and two-wheeler third party insurance if a draft proposal put out by the Insurance Regulatory and Development Authority of India (Irdai) gets approved by the government.

In the draft proposal, IRDAI has recommended 5% hike in annual premium for car insurance for hatchbacks (not exceeding 1,000cc) and sedans (1,000-1,500cc) to Rs 2,182 and to Rs 3,383 respectively. For SUVs (above 1,500cc), Irdai has kept rates steady at Rs 7,890, the Times of India mentioned in a report. Those who will buy multi-year car policy may see a 15% increase in premium. Irdai has proposed increasing premium for three-year policies for cars below 1,000cc by 15% to Rs 6,079. However, for autos, the regulator recommended a 50% cut to Rs 1,241, the publication mentioned.

Five-year premiums are set to rise 15% for two-wheelers (below 75cc) and (75-150cc) to Rs 1,233 and Rs 3,845 respectively. For bikes (150-350cc), insurance cost will increase 19% to Rs 6,505. Irdai kept rates steady for high-end bikes (above 350cc) at Rs 13,034, the daily mentioned.

While Irdai has also recommended that insurance premium for cars that are 1,000-1,500cc be increased by 6.5% to Rs 10,149, for luxury cars, the regulator kept rates steady at Rs 24,305.

For two-wheelers, insurance is set to rise 2-11% with the highest increase of 11% for high-end bikes (above 350cc) and 9% for power bikes (150-350cc) to Rs 1,301. Mopeds and scooters (below 70cc) will see an increase of 5% to Rs 506, while scooters and bikes (75-150cc) insurance will see a hike of 5%. However, it remains to be seen if the government agrees to this. It is possible the government might keep rates steady or cut prices for trucks in deference to representations made by the trucking industry, the publication said.

For private goods carrying commercial vehicles, Irdai has proposed a 2% increase for trucks of capacity below 7,500kg, 7,500-12,000kg, 12,000-20,000 kg, and 20,000-40,000kg, as well as trailers (above 40,000 kg) to Rs 8,607, Rs 17,549, Rs 11,094, Rs 17,827 and Rs 25,323 respectively. The insurance regulator has also proposed 5-10% increase in third party premium for state-owned vehicles will be the 5-10% increase proposed by Irdai. State-owned vehicles (of the same capacity) are already charged 60-200% higher than their private counterparts.

Source: ET Now