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Digital Desk: With effect from June 1, the Ministry of Road
Transport and Highways (MoRTH) increased the third-party (TP) motor insurance
premium for various kinds of vehicles, a decision that is likely to raise the
cost of insurance for cars and two-wheelers.
According to the amended rates announced by the MoRTH, private
cars with a 1,000 cc engine would be charged Rs 2,094 instead of Rs 2,072 in
2019-20.
Similarly, private cars with engines ranging from 1,000 to 1,500
cc would pay Rs 3,416 instead of Rs 3,221, while cars with engines larger than
1,500 cc will pay Rs 7,897 instead of Rs 7,890.
Two-wheelers with a displacement of more than 150 cc but less
than 350 cc would be charged a premium of Rs 1,366; two-wheelers with a
displacement of more than 350 cc will be charged a revised premium of Rs 2,804.
The revised TP insurance price will take effect on June 1 after
a two-year hiatus owing to the Covid-19 pandemic.
The Insurance Regulatory and Development Authority of India had
previously announced TP rates (IRDAI). The MoRTH has notified the TP prices for
the first time in consultation with the insurance regulator.
According to the ministry's announcement, hybrid electric
vehicles would be eligible for a 7.5 percent premium reduction.
Electric private automobiles with less than 30 kilowatts will be
charged Rs 1,780, while those with more than 30 kilowatts but less than 65
kilowatts would be charged Rs 2,904.
In 2019-20, the premium for goods-carrying commercial vehicles
weighing more than 12,000 kg but less than 20,000 kg would rise to Rs 35,313
from Rs 33,414.
The premium for goods-carrying commercial vehicles weighing
more than 40,000 kg would rise to Rs 44,242 from Rs 41,561 in 2019-20.
Other than own damage, third-party insurance is required in
addition to the own damage coverage that a car owner must obtain.
This insurance covers any collateral damage caused by a road
collision to a third party, usually a human individual.
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