The Department of Roads and Motorways has proposed new premium rates for motor liability insurance for various categories of vehicles, including two-wheelers, passenger cars and commercial vehicles, for the 2023/24 financial year.
According to a draft notice issued by the Ministry, base premium rates for motor vehicle liability insurance coverage were proposed at ₹2,094 for private cars under 1,000 cc, ₹3,416 for cars between 1,000 cc and 1,500 cc, and ₹7,897 for cars over 1500 cc.
The draft rule was prepared in consultation with the Insurance Regulatory and Development Authority of India (IRDAI).
The premium is ₹1,780 for electric cars with an output of no more than 30 kilowatt hours and ₹2,904 for 30 to 65 kW. The premium for electric cars with more than 65 kilowatt hours is ₹6,712.
A discount of 15% and 7.5% respectively has been proposed for electric vehicles and hybrid vehicles.
A 15% discount was proposed for educational buses and a 50% discount for a private car registered as a vintage car. For three-wheeled passenger vehicles, a reduction in the base rate of around 6.5% has been proposed.
The ministry has invited comments and suggestions from all stakeholders within thirty days.
Proposed tariffs for electric two-wheelers not exceeding 3 kW are ₹457, 3 KW to 7 KW (₹607), 7 KW to 16 KW (₹1,161) and for 16 kW and more (₹2,383).
For battery-powered goods used to transport commercial vehicles (other than tricycles) weighing not more than 7,500 kg, the proposed rate is ₹13,642, ₹7,500–12,000 kg (₹23,108), ₹12,000–20,000 kg (₹30,016), 20,000–40,000 kg ( ₹37,357) and for people over 40,000 kg (₹37,606).
According to Moody’s, Indian general insurers’ claims expenditures have increased in recent months due to inflation and a return to normal claims levels after a pandemic-related decline.
“In line with global trends, Indian general insurers’ claims are rising due to high inflation and a return to more normal claims frequencies after a pandemic-related decline in 2020. This is accompanied by higher reinsurance costs as global reinsurers seek to recover strongly.” “Catastrophic claims around the world and increasing natural disasters in India in recent years are putting pressure on their profitability,” the rating agency said in a statement earlier this year.
