Amid the recent changes made to third party motor insurance policy premiums, one will be able to purchase a standalone annual "own damage" insurance starting 1 September 2019. Both car and two-wheeler owners will be able to do so.
As per the Indian law, holding a third party damage cover is mandatory for vehicle owners. Until last year, vehicle owners could opt for one-year policies (for both the covers) with annual premium charges. However, the IRDAI made it mandatory for four-wheelers and two-wheeler vehicles to have three-year and five-year third party insurance policies, respectively. These policies can still be clubbed with own damage cover.
OD insurance covers protect a vehicle against repairs, theft and fire. Their purchase is not a compulsory and the decision to buy, remains in the hands of the vehicle owner.
If should be noted that while the IRDAI (Insurance Regulatory and Development Authority of India) has allowed insurers to offer package policies, in addition to stand-alone OD and TP policies, it was clarified that long term stand-alone own damage policy would not be permitted for the time being. These could be issued on an annual basis.
IRDAI has given policyholders the option to renew the own damage component of a bundled cover falling due on or after 1 September with the same insurer or a different insurer.