As per a latest Supreme Court ruling, all general insurance companies will have to offer long-term third party motor insurance to owners of cars and bikes purchased after September 1. In a circular issued on August 28, the Insurance Regulatory and Development Authority of India (IRDAI) has directed all the insurers to provide only three-year third-party motor insurance cover for new cars and five-year third-party motor insurance policies to new two-wheelers from the start of the next month.
IRDAI says that this move is in conjunction with the latest Supreme Court order, which is dated 20 July, 2018. In this order, the apex court of India has said, We make it clear that the third party insurance cover for new cars should mandatorily be for a period of three years and for two-wheelers, it should mandatorily be for a period of five years.
This may be taken and treated as a separate product. The decision should be implemented from 1st September, 2018 on the policies sold. Currently, motor insurance premium has to be paid on an yearly basis. However, some general insurance companies were providing multi-year motor insurance policies.
Now, however, the regulatory authority has asked all general insurance companies to offer only 3- and 5-year third-party covers cars and two-wheelers respectively. Prices of the one-year comprehensive insurance policies for cars and motorcycles remain unchanged as of now. This simply means that there will be no immediate impact on the on-road costs of a vehicle.
Vehicle Category :
Less Than 1000cc :Rs 5,286
Exceeding 1000cc but below 1500cc :Rs 9,534
Exceeding 1500cc :Rs 24,305
Seen above are the costs of 3-year Third Party Motor Insurance Premium for the policies that will be sold in the period 1st September 2018 to 31st March 2019.