Premium rates for third-party two-wheeler insurance has been raised. The Insurance Regulatory and Development Authority of India (IRDAI) has passed an order which instructs all insurance providers to increase premium rates for third-party insurance.
Different categories of two-wheelers see different rates of increase. Insurance is mandatory for all vehicles to be used legally on Indian roads. However, with time, the Insurance premium rates have been increasing and it is certainly becoming difficult for the common man to pay for insurance.
It was only a few months ago in 2018 that IRDAI instructed all two-wheeler dealers to make it mandatory for all two-wheeler buyers to get a five-year insurance cover right at the time of purchase.
This instantly pushed up prices of two-wheelers across the country even though ex-showroom prices remained the same. Now the IRDAI has hiked premium rates. Two wheelers with engine capacity less than 75cc face a hike of 12.9 percent, but we doubt this would affect anybody because there are barely any vehicles under 75cc in India.
Two-wheelers between 75cc and 150cc see a price hike of 4.4 percent. This is the category that has experienced and continues to experience the highest sales in India. A large majority of two-wheelers on Indian roads fall under this category and they might get affected by the hike.
The 150cc to 350cc category gets a nice, chunky hike. This category sees the highest hike of 21.1 percent. This is one is the rapidly growing segments in the Indian market. Motorcycles with engine capacity above 350cc do not get the hike in premium and they stick to the previously set amount of Rs 2,323.
The new guidelines by the IRDAI also specifies the insurance premiums for electric two-wheelers. Vehicles below 3kW have a set premium of Rs 410. Electric two wheelers with capacity between 3kW and 7kW are set at Rs 639.
Those with capacity between 7kW and 16kW will cost Rs 1,014 to insure while the powerful one's with capacity above 16kW will have a set premium of Rs 1,975. The new premium rates will be effective from 16 June, 2019.
Thoughts On Hike In Third-Party Insurance Premiums For Two-Wheelers
Though the largest hike has been implemented on two-wheelers between 150cc and 350cc, the motorcycle owners in this segment will not feel the pinch as much as those in the segment below.
Many two-wheeler owners in this category skip the annual insurance renewal premium but because they do not want to pay but because they feel the same money can be put to use in another way. The truth however is that this premium helps to protect them from any untoward incident which might cost them a lot more.