IRDAI to Hike Motor Insurance Premium Rates From April 1

Effective from April 1, the decision will affect the insurance cost of both cars and bikes by up to 40 per cent.

By Carandbike Team

1 mins read

Published on March 30, 2016

Highlights

IRDAI (Insurance Regulator and Development Authority of India) will introduce a hike in motor insurance premiums. Effective from April 1, the decision will affect the insurance cost of both cars and bikes by up to 40 per cent. The insurance regulator cited the 5.57 per cent increase in cost inflation index (CII) over the previous year as the reason for the hike. From April 1, 2016 third party motor insurance premium for small cars (up to 1,000cc) will be 39.9 per cent i.e. Rs 2,055 instead of the current Rs 1,468. While that for mid-segment cars (1,000cc - 1,500cc) too is about 40 per cent. Bigger cars and SUVs (above 1,500 cc) will see a premium hike of 25 per cent; buyers will have to pay Rs 6,164 as against the current Rs 4,931. For two-wheelers, the new rate for vehicle up to 75cc will be Rs 569. Under the revised rates, a hike of 15 per cent for products that fall in the category of 75cc - 150cc, and 25 per cent for 150cc - 350cc bikes will be observed. Interestingly, motorcycles in the above 350cc category will pay a reduced premium of Rs. 884. One must note that basic third party (TP) premium for three-wheelers too has been increased. A new category 'e-rickshaw' (capacity of up to 6 passengers) has been introduced and the basic TP premium has been fixed at Rs 1,125. Cars: a. Up to 1000cc 39.9 per cent/ Rs. 2,055 b. 1000cc - 1500cc 40 per cent c. Above 1500cc 25 per cent/ Rs. 6,164 Two-Wheelers a. Up to 75cc Rs. 569 b. 75cc - 150cc 15 per cent c. 150cc- 350cc 25 per cent d. Above 350cc Rs. 884