Insurance regulator recommends 3 years for cars, 5 years for two-wheelers
Regulator IRDAI on Wednesday proposed introducing three-year auto and five-year two-wheeler insurance plans aimed at giving customers more choice.
The Insurance Development and Regulatory Authority of India (IRDAI) has released a draft of ‘Long Term Motorcycle Products including Third Party Motorcycle Insurance and Private Damage Insurance’.
The draft proposal allows all general insurers to offer 3-year insurance policies for personal cars and 5-years for two-wheelers, concurrently with third-party liability insurance for motorbikes. .
Premiums for the entire policy term will be collected at the time of insurance sales.
Valuation, according to the draft, will be based on sound statistical principles, including long-term discounting and claims experience.
“The pricing of add-on and optional packages may also consider the cost-effectiveness of policy management,” the draft said, under which IRDAI invited stakeholders to comment before the date. December 22.
It also says the existing No Claim Bonus (NCB) for 1-year Motorcycle Damage policies will also be applied to long-term policies. The NCB applied at the end of the contract period in the case of a long-term contract will be the same amount as would be obtained if the contract was renewed annually.
In the case of long-term Independent Personal Damage policies issued in conjunction with Third Party Liability coverage for motor vehicles, the 9-month policy period may be considered a full year. for NCB to recognize during the year.
IRDAI has also released a draft of long-term firefighting products and allied hazards. It has proposed an insurance policy of up to 30 years for the home.
Housing includes stand-alone houses, villa complexes as well as apartment complexes managed by housing cooperatives or resident welfare associations or any other agency representing the owners. home.
Long-term fire coverage may be canceled during the term of the policy.
First published date: December 8, 2022, 07:50 AM IST