IRDAI suggests increasing premium by 18-25%, know why it is necessary and how much more you will have to pay
Getting third party insurance for your vehicle can be expensive. According to media reports, the Insurance Regulatory and Development Authority of India (IRDAI) has suggested the government to increase the third party insurance premium.
IRDAI has suggested an average increase of 18% in the premium, while in some vehicle series this increase can be from 20% to 25%. Now the final decision on this proposal will be taken by the Ministry of Road Transport and Highways. A decision on this can be taken in 2 to 3 weeks.
Once the ministry approves it, a draft will be shared with the public to get their opinion. After this, other processes like taking suggestions and reviewing will be done, only after which these changes will be implemented. No change has been made in the premium of this insurance for the last three years.
How much will the third party insurance premium of two wheelers increase?
|
Engine capacity |
Current Insurance Premium |
After 18% Increase |
Difference |
|
Up to 75 cc |
Rs 568 |
Rs 635 |
Rs 67 |
|
75 to 150 cc |
Rs 752 |
Rs 887 |
Rs 135 |
|
150 to 350 cc |
Rs 1,366 |
Rs 1,612 |
Rs 246 |
|
More than 350 cc |
Rs 2,804 |
Rs 3,309 |
Rs 505 |
How much will the third party insurance premium of four wheelers increase?
|
Engine capacity |
Current Insurance Premium |
After 18% Increase |
Difference |
|
1000 cc |
Rs 2,094 |
Rs 2,471 |
Rs 377 |
|
1000 to 1500 cc |
Rs 3,416 |
Rs 4,270 |
Rs 615 |
|
More than 1500 cc |
Rs 7897 |
Rs 9871 |
Rs 1421 |
This calculation is approximate
Now understand what is third party Insurance?
Third-party insurance is a basic type of vehicle insurance that is required by law in India. It protects you from having to pay for damage or injury caused to other people or their property in an accident.
Meaning of third party insurance: This insurance compensates for the damage caused by your vehicle to a third party (such as a pedestrian, other driver or their property). It does not cover damage caused to you or your vehicle, but provides protection for damage caused to other people.
Understand this with an example: Suppose your car causes an accident in which someone else's vehicle is damaged, or someone is injured, or their property is damaged. In such a situation, third party insurance covers the damages, such as repair costs or medical bills.
What is covered?
- Compensation in case of injury or death to a third party (up to ₹7.5 lakh).
- Compensation for damage to a third party's property (such as another vehicle, shop or house).
Why is third party insurance necessary?
- This is legally mandatory. Driving without third party insurance is illegal, and can result in fines or legal action.
- It saves you from the financial burden, if your fault causes damage to someone else, the insurance company compensates for it.
What does it not cover?
- Damage to your own vehicle (for this you will have to take comprehensive insurance).
- Your own injuries or medical expenses.