Buying a car or a two-wheeler is likely to be expensive from June 1. The Centre on Thursday hiked the third-party motor insurance premium for various categories of vehicles, PTI reported. The hike in the third-party motor insurance comes at a time when the citizens are battling inflation and increase in petrol and diesel prices.
The third-party insurance cover is basically for other than own damage and is mandatory along with the own damage cover which is purchased by the vehicle owner. In simple words, this cover is for any collateral damage to a third party, usually a human being in case of an accident.
According to the Ministry of Road Transport and Highways, private cars having an engine capacity of 1,000 cc will attract rates of ₹2,094, a 1.06 per cent increase from the premium price in 2019-20.
On the other hand, vehicle owners of private cars having engine capacity between 1,000 cc and 1,500 cc will have to pay third party insurance premium of ₹3,416 as compared to ₹3,221. However, the owners of cars with engine capacity above 1,500 cc will witness a marginal dip in premium from ₹7,897 to ₹7,890.
In case of two wheelers of engine capacity between 150 cc and 350 cc, the premium has been capped at ₹1,366, while those buying two-wheelers of above 350 cc need to pay ₹2,804.
This is the first instance when the road transport ministry has notified the third-party motor insurance rates. Earlier, these rates were usually notified by the Insurance Regulatory and Development Authority of India (IRDAI).
The road transport ministry also set premium for the electric private cars of less than 30 kilowatts will attract a premium of ₹1,780 while those between 30 kw and 65 kw to have premium of ₹2,904.
The premium for goods carrying commercial vehicles exceeding 12,000 kg but not 20,000 kg will increase to ₹35,313 from ₹33,414 in 2019-20.
In the case of goods carrying commercial vehicles exceeding 40,000 kg, the premium will increase to ₹44,242 against ₹41,561 in 2019-20.
said “It is a unanimous view of the road transport fraternity of India that the increase in third-party premium for goods and passenger commercial vehicles is uncalled for,” All India Motor Transport Congress (AIMTC) president Kultaran Singh Atwal told PTI.