In a meeting with the IRDAI, it was decided that the premium rates would be loaded only in proportion to the accidents caused by a particular category of vehicles after appropriate study.
The Madras High Court has issued a notice to the Centre and the IRDAI on a petition alleging disparity in fixing third party insurance premium rates for goods carriages by the regulator. When the plea by Tamil Nadu Lorry Owners Association came up recently, Justice T Raja issued the notice to the Ministry of Highways and Road Transport and the Insurance Regulatory and Development Authority of India, returnable by four weeks. The petitioner claimed that third party insurance premium rates for goods carriages have been increased by 1,117 per cent in the past 15 years, while that for private cars and two-wheelers have been substantially reduced by the IRDAI.
Owners of goods carriages are made to pay higher premiums rates year after year, the association alleged. It submitted that third party insurance is mandatory under the Motor Vehicles Act for all motor vehicles. Generally, goods carriages are covered by a comprehensive insurance policy, covering the vehicle and the third party, the association said. Since general insurance firms stopped providing insurance cover to goods carriages older than 10 years, such vehicles are covered with only third party insurance, it said. Considering the grievances of goods carriage owners, the ministry had assured them that the premium rates would not be increased further without consulting them, it said.
In a meeting with the IRDAI, it was decided that the premium rates would be loaded only in proportion to the accidents caused by a particular category of vehicles after appropriate study, the association said. Despite assurances, the IRDA on March 7 released a draft proposal to increase premium rates, it said. Challenging the move, the association has filed the plea.