Come September 1, 2018, and you will buy a car or a two-wheeler more expensive as long-term third-party insurance policy has been made mandatory by the Irdai after a Supreme Court order. The three-year third-party insurance will come at a price of Rs. 5,286 for cars having an engine capacity of less than 1,000 cc, Rs. 9,534 (1,000 – 1,500 cc) and Rs. 24,305 for cars which have got an engine capacity of 1,500 cc and more.
And for two-wheelers, insurance for a term of five year-third party will come at a price of Rs. 1,045 for vehicles which have engine capacity below 75 cc, Rs. 3,285 (75-150 cc), Rs. 5,453 (150-350 cc) and Rs. 13,034 (exceeding 350 cc).
The Motor Vehicles Act makes third-party insurance mandatory.
And regarding the issue of comprehensive insurance, which comes with theft, damage and more coverage, the vehicle buyer would have the option to buy it for one year or a total three years for cars and five years in case of two-wheelers.
The court order had made it mandatory for all general insurance companies to issue a three-year third-party insurance cover for new cars and five-year third party (TP) insurance cover for new two-wheelers as a separate product or as part of a comprehensive insurance product.
Irdai was asked to implement the recent decision on policies sold from September 1, 2018.
In this regard, The Insurance Regulatory and Development Authority of India (Irdai) has issued a circular.
The circular directs general insurers to “offer only three-year Motor Third-Party Insurance covers for new cars and five-year motor third party insurance policies for new two-wheelers”.
There are two types of policies in the motor segment as of now – stand-alone Motor Third-Party policy and Motor Package Insurance policy for private cars and 2-wheelers.
Further to that, Irdai said that an insured should be given two options after the introduction of long-term Motor TP arty insurance – Long-term package cover offering both Motor TP insurance and own Damage insurance for three years or five years as the case may be or a bundled cover with a 3/5-year term for the TP component and a one-year term for the own damage.
Despite all these, there are some cars and bikes that may prove cost-effective along with performance to suit your budget. Buyer should do a good research before finalizing any good product. Brand is not the main thing for us to finalize any product, but performance is the most valued asset to take note.