The e-Government of India will soon eradicate the upper cap for the insurance companies on liabilities on third parties in an event of road accidents or death. IRDAI (Insurance Regulatory and Development Authority of India) has sent an application to the government authority proposing that the third party insurance should be increased by 50 per cent for all segment of cars for the current fiscal year, excluding some vehicles like mini hatchbacks, vans, and small trucks.
The rates of premium for the insurance is updated by Insurance Regulatory and Development Authority of India every year. These revisions and updates are based on the number of insurance claims have been made and according to the loss suffered by the insurance companies.
The insurance companies might also push for another hike in the rates of premium after the Motor Vehicle Bill amendment is passed. The hike amount or percentage will depend on the type and displacement value of the vehicles. The figures are yet to be seen.
Third party insurance is taken in order to cover for any injury or death by an accident caused by you to an individual or property. This kind of insurance is comprehensive on cars and motorcycles. However, vehicle owners can also avail standalone for third party insurance.
The vehicles having a displacement of over 1,500 cc had seen the third party insurance premium rates get up by 25 percent, while the vehicles with displacement below 1,400 cc witnessed a surge of 40 per cent last year. On a similar note, for two wheelers with a displacement of below 150 cc, the rate went up by 10-12 per cent, while the motorcycles with a displacement value between 150-350 cc had a hike by 25 per cent. However, the motorcycles with over 350 cc displacement saw the rates going down by 10 per cent.
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