7 March 2016

Third-party motor insurance premium rates can go up by 30 per cent from April 1 if a proposal of the Insurance Regulatory and Development Authority of India (IRDAI) gets accepted.

The increase in the mandatory third-party insurance premium, however, varies depending on the category of vehicles (private/commercial) and their capacities.

For example, for four-wheeled vehicles not exceeding 1,000 cc, the basic premium is proposed to be hiked from ₹4,920 to ₹6,396 while for those exceeding 1,000 cc, it will be ₹8,408 (₹6,726).

The authority arrived at these figures after going through data supplied by the Insurance Information Bureau (IIBI) for the period from 2007-08 to 2014-15. The data included the number of policies, number of claims reported and amount of claims paid up to March 31, 2015 for each vehicle category.

The final decision on premium rates is expected by the month end as the authority wants feedback from all stakeholders to an exposure draft released last week.

Source: The Hindu Business Line