Third-Party Motor Insurance Premium to Cost More in India

Every year, the IRDAI revises the rate structure of third-party car insurance plans in March, considering inflation and other necessary factors. After two years, the insurance regulatory board has determined to increase the price of premiums for different categories of vehicles in 2022. The transport ministry of India has confirmed that changes in the premium price are to be applicable from June 2022.

Change in the Price of Insurance Plans

Following are changes in the rate-structure of third-party motor insurance premiums, listed according to the vehicles’ engine capacity:

1. Revised Third-Party Car Insurance Premiums

Here you can find the change in this premium for private cars:

• Private cars with an engine capacity up to 1000 cc: You need to pay Rs. 2,094. Earlier, you had to pay Rs. 2,072.
• Private cars with an engine capacity between 1000 cc and 1500 cc: The premium is to be increased from Rs.3,221 to Rs. 3,416.
• Private cars with an engine capacity above 1500 cc: The cost of a third-party car insurance policy is to be increased from Rs. 7,890 to Rs. 7,897.

2. Revised Third-Party Two-wheeler Insurance Premiums

Following are the changes in the premium price of bikes:

• Bikes with an engine capacity under 75 cc: The increase in the premium price will be from Rs. 482 to Rs. 538.
• Bikes with an engine capacity between 75 cc and 150 cc: There has been no increase in the cost of third-party insurance plans in this category. You need to pay Rs. 714.
• Bikes with an engine capacity between 150 cc and 350 cc: The premium will increase from Rs. 1,193 to Rs. 1,366.
• Bikes with an engine capacity above 350 cc: The price is to inflate from Rs. 2,323 to Rs. 2,804.

3. Electric Vehicle Insurance Premiums

IRDAI has also determined the costs of third-party insurance policies for electrical vehicles (EVs) according to power outputs. These are as follows:

• Cars with an engine output of below 30 KW: You have to pay a premium of Rs. 1,780.
• Cars with an engine output of between 30 KW and 65 KW: The premium in this category will be Rs. 2,904.
• Cars with an engine output over 65 KW: The premium will be Rs. 6,712.
• Bikes with an engine output below 3 KW: The premium will be Rs. 457.
• Bikes with an engine output between 3 KW and 7 KW: The premium will cost Rs. 607.
• Bikes with an engine output between 7 KW and 16 KW: The cost of the premium will be Rs. 1,161.
• Bikes with an engine output over 16 KW: The price of this premium will be Rs. 2,383.

Whatever the price of this third-party car insurance policy may be, you must ensure that your vehicles are covered under it. According to the Motor Vehicle Act of India, 1988, driving your vehicle with an active third-party insurance policy is mandatory. Else, you may encounter severe penalties and litigation hassles.

Inclusions of a Third-Party Insurance Policy

This motor insurance policy lets you cover the following aspects:

● Damage to Third-Party Property

If accidents cause damages to third-party property, the insurer will give compensation for the loss up to the sum insured.

● Third-Party Injuries

If the accident leads to bodily injuries to a third person, the policy lets your cover the medical expenses. This way, you do not have to bear the financial loss after on-road mishaps.

Exclusions of a Third-Party Insurance Policy

You cannot get policy benefits under the following conditions:

• Any damage caused to the third-party properties/people when you are under the influence of any kind of intoxicants, including drugs, alcohol, etc.
• You cannot get policy benefits if you ride/drive without a valid driving license.
• Insurers will exclude you from getting the policy benefits if you break any traffic rules.
• Injury or damage to you or your own vehicle will not be covered under a third-party insurance policy.

How to Buy a Third-Party Insurance Plan

Here is a step-wise guide for buying this motor vehicle insurance plan:

Step 1: Visit the official website of the online marketplace of motor insurance plans

Step 2: Select an insurance plan after checking various factors, including the coverage and premium amount

Step 3: Get the application form

Step 4: Fill in this form with necessary details and attach the required documents

Step 5: Pay the policy price

After these steps, your insurer will send you the policy document in your email ID.

In conclusion, IRDAI has determined to increase third-party insurance premiums after 2 years. Still, as per the Motor Vehicle Act, you must ensure that you have at least a third-party insurance plan. It helps you avoid any financial liabilities if the accident with your vehicle leads to damages or injuries of third-party property or people.