New Delhi:
Car and two-wheeler insurance will cost more from June 16 with regulator Irdai increasing the mandatory third party (TP) motor insurance premium by up to 21 per cent for certain categories.
Normally, the mandatory motor TP insurance cover, whose rates are still regulated by the IRDAI, is revised from April 1. However, this time, the new rates for the fiscal 2019-20 will be applicable from June 16.
IRDAI in an order said the new TP insurance for smaller cars (less than 1,000 cc) will cost Rs 2,072 or 12 per cent from the existing Rs 1,850. The hike in insurance premium for cars with engine capacity of 1,000 cc to 1,500 cc has been increased by 12.5 per cent to Rs 3,221.
However, the TP premium for cars with higher engine capacity (1,500 cc plus) has been retained at Rs 7,890.
The new Motor TP Liability Insurance cover from June 16 will be Rs 482, up 12.88 per cent for two-wheelers with engine capacity of less than 75 cc and Rs 752 for those with engine capacity of 75-150 cc.
The maximum hike is for two-wheelers having engine capacity between 150-350 cc. The new premium will be Rs 1,193, up 21.11 per cent from the existing Rs 985. There will be no change in TP insurance premium for super bikes (350 cc plus).
Irdai has also increased the TP insurance for public as well as private goods carrying vehicles.
There is no change for rates in case of e-rickshaw. However, the third party insurance premium in case of school buses has been increased.
Also, there is no change in long-term single premium rates. In case of cars, the long-term premium is for three years, and for two-wheelers, it is five years.
IRDAI has been regularly increasing the Third-Party (TP) motor vehicle insurance rates for 5 years continuously since 2013, except in 2018-19. The average increase in the TP premium over the last 6 years for private cars was 29 per cent and for two-wheelers was 23 per cent, said analysts.
There has been a maximum increase of 12.5 per cent for private cars and 21 per cent for two-wheelers over the current premium after 2 years, they added.
The authority used the data provided by the Insurance Information Bureau of India (IIBI) for deriving the Motor TP premium rates and the claims paid data in respect to each of the accident years. The data into consideration has been taken from the year 2011-12 up to 2017-18.