Beginning August 1, 2020, IRDAI said it will took off the shelf its long term motor insurance policy i.e. for a term of 3 years for 4-wheelers and 5 years for 2-wheelers. This is the comprehensive cover which included both third-party as well as own damage package elements in the cover.
The decision to make such a policy compulsory was taken in August and accordingly such decision had to be implemented from September 2018. And as per the decision of the insurance regulator, insurance companies could sell two kind of products i.e. 3-year TP and 3-year own damage for 4-wheelers and 5-year TP and 5-year own damage for 2-wheelers. The other being 3-year TP & 1-year OD policy For 4-wheelers & 5-year TP & 1-year OD policy for 2-wheelers.
Notably, the decision has been taken to withdraw the first combination of product. It is to be noted that long term motor third party policies shall still be mandatory i.e. premium shall be paid for 3-years in the case of 4 wheelers and 5-years in case of 2-wheelers.