Petrol and diesel prices are already rising day by day. Insurance companies are all set to hike insurance premiums this year. Companies plan to increase third party motor insurance by 15 to 20 per cent. In a proposal sent to the Insurance and Regulatory Development Authority of India by insurance companies, the insurance companies have sought approval to increase third party insurance by 15 to 20 per cent in view of the losses incurred by companies due to corona. If the companies' demand is met, it will have a direct impact on millions of vehicle owners in the country.
According to Zeebiz, there are about 25 general insurance companies in India. The companies hope that IRDA will approve their proposal. Companies say the corona is causing a lot of damage. The current premium for third party insurance is not good. Companies are losing money. The situation of some companies is such that their solvency has gone below their prescribed limits. Third party insurance claims have also increased. This has also increased the pressure on companies.
Following the Supreme Court decision in 2018, it is mandatory to take 5 years third party insurance when buying a new two-wheeler and 3 years third party insurance for four wheelers. According to the Motor Vehicle Act, any vehicle traveling on the road must have third party insurance. Insurance premium is determined by IRDAI. The premium changes every year.