Everything You Should Know About Multiyear Motor insurance
Do you know that the Supreme Court ordered and IRDAI (Insurance Regulatory and Development Authority of India) made it mandatory to have a long- term third- party liability insurance cover, from 1st September 2018? Yes! The regulatory has already issued a notice and made it mandatory. This means that from now onwards whenever you are buying a new car you have to buy third- party liability insurance policy for a period of three years, whereas if you are purchasing a two- wheeler than you mandatorily have to buy five years third- party insurance policy for your bike. Still Confused?? Let’s make everything you should know about Multiyear Motor Insurance more clear and simple.
All the car lover and bike lovers should know that purchasing a new car or bike can be a bit expensive from 1 September 2018 onwards. As all new cars sold in India, will now come with a mandatory third-party insurance for three years which was earlier for one year. Until now, every car owner had to buy or renew insurance policy for his/her vehicle every year whether a comprehensive insurance or a third-party liability only. But from now onwards, if someone is buying only third-party insurance for his/her vehicle, he/she has to buy is for three years in case of car and five years in case of two-wheeler. Whereas, vehicle owners can still buy one- year comprehensive insurance policy for their vehicles, as per the notification. Moreover, there will be no change in insurance of the existing vehicles and shall be renewed annually.
Now, let’s have a clear picture of what premium a vehicle owner has to pay from now onwards under this multiyear insurance policy notification. Below table will clear all your doubts regarding long- term motor Third- Party premium for the policies sold during the period from 1st September 2018 to 31st March 2019:
For Private Cars
|Engine Capacity||Long-Term Third-Party Premium for Three Years (in Rs.)|
|Not exceeding 1000 cc||5,286|
|Exceeding 1000 cc but not exceeding 1500 cc||9,534
|Exceeding 1500 cc||24,305|
|Engine Capacity||Long- Term Third-Party Premium for Five Years (in Rs.)|
|Not Exceeding 75 cc||1,045|
|Exceeding 75 cc but not exceeding 150 cc||3285|
|Exceeding 150 cc but not exceeding 350 cc||5,453
|Exceeding 350 cc||13,034|
Hopefully you get an idea about the new order of The Supreme Court, now. So, according to the order, you have following three options in vehicle insurance in case when you purchase a brand- new vehicle:
Option 1 – You can purchase only third-party liability insurance for three years.
Option 2 – You can purchase three years full Insurance which will be very expensive and not recommended.
Option 3 – You can purchase one-year full insurance which is comprehensive insurance along with three years Third party Insurance. This option is highly recommended.
Though the vehicle owners have no other choice other than paying more premium for an insurance policy, still they have got so many benefits to enjoy. Let’s have a look on the benefits of having third- party vehicle insurance for three years:
- Agree that initially you have to pay more premium, collectively for three years, as a third- party premium in advance. But once paid the premium, you need not to worry about renewing the insurance every year. Just pay the premium once and get a freedom from renewals for three years.
- The government increases third party rates every financial year. By paying the car insurance premium once, you will beat the price hike. Even if the premium rates increases, you need not to pay extra money as you have already paid the fixed premium amount for three years.
- You can still change your insurance company and get the best deal and better coverage as per your requirement at the time of renewals rather than getting stuck with one company and one plan for three years.
- This will also lead to lower uninsured cars on Indian roads, as people tends to overlooked the renewal dates for their vehicles’ insurance policy.