IRDA hikes third-party motor insurance premium

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IRDA hikes third-party motor insurance premium
The insurance regulatory body, IRDA, after coming out with the draft recommendations for hiking the premium amount for third-party motor insurance last month, has announced an hike effective April 1, 2014. Nonetheless, the quantum of the hike is substantially less than the proposed increase.

The hike in the passenger car segment across categories ranges anyway between 19-20% while for the two-wheeler the hike will be in between 9-10%. So, the hike thus has come as a relief to two-wheeler and car owners who could have been hit by the proposed hike of upto 137%.

The passengers car with a capacity below 1000 cc can now be insured at Rs. 1,129 as against the existing Rs. 941. For cars with still higher engine capacity of 1000-1500 cc, third-party insurance premium would amount to Rs. 1,332 as against Rs. 1,110. Cars with engine capacity of over 1500 cc shall then attract a premium of Rs. 4,109 in comparison to Rs. 3,424.

In the two-wheelers segment, the hike for two-wheelers with engine capacity of 350cc and above has been from Rs. 804 to Rs. 884. For lower capacity bikes, the insurance premium has been increased ro Rs. 464 and Rs. 462 respectively for 75-150cc and 150-350cc bikes.

The loss making general insurers has instituted IRDA to increase the third-party insurance premium by 50-60%. Though the third-party motor insurance is mandatory for all vehicles, the provision therein provides claim for any amount i.e. third-party motor insurance policies come with unlimited liability. Know about claiming motor insurance by clicking here.

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