Insurance Regulatory and Development Authority of India (IRDAI) hikes motor third party premium by up to 41%

Vehicle insurance premium will go up from April 101,2017

The Insurance Regulatory and Development Authority of India (IRDAI) has increased rates by up to 41 per cent across various categories of vehicles.

The new premium rates applicable for fiscal 2017-18 was notified by the regulator on Tuesday.

The quantum of increase varies widely depending on the category of vehicles, such as two-wheelers, private cars, goods carrying vehicles (both public and private), motorised three-wheelers, and trailers.

In an exposure draft issued on March 3, the IRDAI had proposed an increase of up to 50 per cent for certain categories of vehicles.

The final order has, however, capped the maximum increase at 41 per cent.

“After examining the comments received from various stakeholders, the Authority has revisited the premium rates as the exposure draft has further moderated the premium rates in some categories,” Yajna Priya Bharath, Chief General Manager (Non-Life), IRDAI, said.

Small, large cars

Motor third party insurance premium for small cars (up to 1,000 cc) will remain at ₹2,055. However, the rate for premium cars powered by 1,000-1,500 cc engines will be 40 per cent higher at ₹3,132.

The 40 per cent hike for bigger cars and SUVs (above 1,500 cc) will mean owners will shell out ₹8,630 from April 1 as against the current ₹6,164.

A discount of 25 per cent will be allowed for private vintage cars certified by the Vintage and Classic Car Club of India.

Two-wheelers

The premium rate for two-wheelers up to 75 cc has not changed and it will reamin at ₹569.

But the premium for two-wheelers in the 75-150 cc category is up 16 per cent to ₹720, and for those in the 150-350 cc by 40 per cent to ₹970.

The premium for super bikes (above 350 cc) has been increased to ₹1,114 from ₹884, up 26 per cent

Rates for trucks

Premium rate for trucks less than 7.5-tonnes (gross vehicle weight) under the public carrier segment has not changed.

For trucks under the private carrier segment, there is a marginal increase for sub-7.5-tonne trucks, while for others the increase is in the 5-40 per cent range.

Insurers are not permitted to cancel the current insurance policies and issue fresh policies to effect new premium rates.