Ministry of Road Transport and Highways issued notification
The Ministry of Road Transport and Highways, in coordination with the Insurance Regulatory and Development Authority of India (IRDAI), has decided to increase the premium rates for third party motor insurance. A draft notification has been issued for this in the ministry. The notification issued on March 4 proposes to increase third party premium rates for vehicles. These new rates, once finalized, will be applicable for the financial year 2022-23.
Let us tell you that this will be the first time in the last two years that the insurance premium in the motor vehicle category will be increased. This amendment was put on hold for the last two years due to the onset of the Corona epidemic. As per the draft released by MoRTH, the third party insurance premium for two-wheelers with more than 150 but less than 350 cubic capacity has been proposed at Rs 1,366. A premium of Rs 2,804 has been proposed for bikes with engines above 350cc.
According to this new notification, private four-wheelers up to 1,000 cc will be charged Rs 2,094, while it will increase to Rs 3,416 for vehicles with 1,000-1,500 cc engines. The proposed premium is Rs 7,897 for cars with engines above 1,500 cc. Whereas, third party insurance on commercial vehicles used for carrying public goods can range from Rs 16,049 to Rs 44,242. As per the draft notification, the premium for vehicles carrying personal belongings may range from Rs 8,510 to Rs 25,038.
Significantly, the ministry has also proposed to encourage the use of electric vehicles by offering a discount of 15 per cent for electric two-wheelers and cars as well as for electric passenger and commercial vehicles. According to the notification, a premium of Rs 457 to Rs 2,383 will be charged for electric two-wheelers depending on their kilowatt capacity, while for electric private cars it will be in the range of Rs 1,780 to Rs 6,712. The draft also states that hybrid electric vehicles will be eligible for a rebate of 7.5 per cent on third party premiums.