Irdai raises minimum driver insurance cover to Rs 15 lakh

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New Delhi | Updated: September 22, 2018 12:11:58 AM

Insurance Regulatory and Authority of India (Irdai) in its circular has asked insurers to enhance capital sum insured in compulsory personal accident cover for owner-driver under motor insurance policies to Rs 15 lakh.

Irdai raises minimum driver insurance cover to Rs 15 lakh

Insurance Regulatory and Authority of India (Irdai) in its circular has asked insurers to enhance capital sum insured in compulsory personal accident cover for owner-driver under motor insurance policies to Rs 15 lakh.

Currently, the mandatory cover is capped at Rs 1 lakh for two-wheelers and Rs 2 lakh for private or commercial cars, respectively. The premiums for Rs 15-lakh cover have been fixed at Rs 750 per annum.
Stakeholders in the industry say even as premium rates go up, coverage will also increase, and it’s a very welcome move for the policyholders. Earlier, the premiums were Rs 50 for two-wheelers and `100 for cars.

Speaking on the new circular from Irdai, Tapan Singhel, managing director & chief executive officer, Bajaj Allianz General Insurance, said, “This move of enhancing the Capital Sum Insured (CSI) of Compulsory Personal Accident (CPA) cover to `15 lakh is a step in the right direction. I strongly believe that it’s vital to have an appropriate personal accident cover since it provides the much-needed financial support to the policyholder and their family members if s/he is disabled or succumbs to an injury due to an accident. We, as a company, support and welcome this move.”

The regulator also said a higher CSI may be provided over and above Rs 15 lakh through optional covers under liability only and under Section III of package policies/bundled covers on the payment of additional premium at the option of the insured. Policyholders who buy a new vehicle would get higher cover, but their premiums will also go up. The new third party long-term policy for two-wheelers is for five years whereas for four-wheelers, it is three years .

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