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Govt proposes to hike third-party motor insurance premium from next fiscal

Govt proposes to hike third-party motor insurance premium from next fiscal

After moratorium of two years due to COVID-19 pandemic, the revised third party insurance premium will come into effect from April 1.

According to the proposed revised rates, private cars with 1,000 cubic capacity (cc) will attract rates of Rs 2,094 compared to Rs 2,072 in 2019-20. According to the proposed revised rates, private cars with 1,000 cubic capacity (cc) will attract rates of Rs 2,094 compared to Rs 2,072 in 2019-20.

The Union Road Transport Ministry has proposed an increase in the third-party motor insurance premium for various categories of vehicles, which is likely to jack up insurance cost of car and two-wheelers from April 1.

According to the proposed revised rates, private cars with 1,000 cubic capacity (cc) will attract rates of Rs 2,094 compared to Rs 2,072 in 2019-20.

Similarly, private cars with 1,000 cc to 1,500 cc will attract rates of Rs 3,416 compared to Rs 3,221, while owners of car above 1,500cc will see a premium of Rs 7,897 compared to Rs 7,890.

Two-wheelers over 150 cc but not exceeding 350 cc will attract a premium of Rs 1,366 and for two-wheelers over 350 cc the revised premium will be Rs 2,804.

After two years moratorium due to COVID-19 pandemic, the revised TP insurance premium will come into effect from April 1.

Earlier, TP rates were notified by the insurance regulator IRDAI. This is also for the first time that the road transport ministry will notify the TP rates in consultation with the insurance regulator.

As per the draft notification, a discount of 15 per cent is proposed for electric private cars, electric two wheelers, electric goods carrying commercial vehicles and electric passenger carrying Vehicles.

The third party insurance cover is for other than own damage, that is for the vehicle. This is mandatory cover, along with the own damage cover, that a vehicle owner has to purchase.

This insurance cover is for any collateral damage to a third party, generally a human being, caused due to a road accident.

The ministry has invited suggestions from all persons likely to be affected by March 14.

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