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Motor Third Party Insurance Premium Set to Increase

The IRDAI, in its draft circular on third-party motor insurance premium, proposed a premium hike in the range of 10-29% from 1st April 2016.

What is third-party insurance?
Third-party insurance is mandatory for all motor vehicles in India. The premium of motor third-party insurance is fixed and revised every year by IRDA.

Existing Premium Rates Proposed Premium wef
01st April 2016
Private Cars
Not exceeding 1000 cc 1468 1908
Exceeding 1000 cc but not exceeding 1500 cc 1598 1998
Exceeding 1500 cc 4931 6164
Two Wheelers
Not exceeding 75 cc 519 569
Exceeding 75 cc but not exceeding 150 cc 538 619
Exceeding 150 cc but not exceeding 350 cc 554 693
Exceeding 350 cc 884 796

For FY 2016, IRDAI has proposed an increase of 29% from Rs.1,468 to Rs.1,908 in the third-party premium rate for a four-wheeler not exceeding 1,000 cc. For those cars between 1,000 cc and 1,500 cc, the proposed rate hike is of Rs.1,998 an increase of 25% from Rs.1,598 earlier. For cars that exceed 1,500 cc, a 25% premium hike is proposed, which takes the premium from Rs.4,931 to Rs.6,164.

The third-party cover for two-wheelers of upto 75 cc capacity would attract a premium of Rs.569 from current Rs. 519; 75 cc to 150 cc capacity would attract a premium of Rs. 619 from the current Rs. 538, and between 150 cc to 350 cc capacity Rs. 693 as against Rs. 554 at present.