Repeat traffic offender? IRDAI panel recommends higher motor premiums for you

If you are a repeat traffic offender and have been penalised for violations while driving your car/bike, soon you will end up paying higher motor insurance premiums.

A working group set by Insurance Regulatory and Development Authority of India (IRDAI) has recommended that a 'traffic violation premium' section be inserted into motor insurance. This section will float over both own damage and third party segments. This means that irrespective of the motor cover sought by a customer, he/she will be subjected to traffic violation premium depending on their driving behaviour.

So, someone (vehicle owner) with rash driving records on the vehicle insured will pay higher premiums than a safe driver. There will be a points system maintained for every violation and those with higher violation points will pay additional premium. For instance, incidents like drunk driving has 100 points while wrong parking has 10 points. Those with 20 points or below don't have to pay additional premium. But from 21 onwards, the penalty premium starts kicking in.

It ranges from Rs 100-750 for two-wheelers and Rs 300-1,500 for four-wheelers and commercial vehicles. This additional premium is paid at the time of renewal. In case someone has bought a new vehicle or a pre-owned car, he/she will not be charged any traffic violation premium at the time of motor policy purchase.

The panel has recommended that this process be conducted on a pilot basis in National Capital Territory (NCT) Delhi. The working group report said that since this region has vehicles from across India, being the capital of the country, other state vehicles that cause traffic violation in NCT Delhi will have to pay traffic violation premium at the time of insuring their vehicle in their own states.

The Insurance Information Bureau of India (IIB) will coordinate with various states’ traffic police and National Informatics Centre to capture the traffic violation data. It will then calculate violation points of each violating vehicle and make this information available to all general insurers through IT system integration with insurers.