Not a very good news for people who will be purchasing or renewing their two-wheeler or car insurance shortly. The Insurance Regulator and Development Authority of India (IRDA) has decided to increase the insurance rates up to 40 per cent from the first day of April.The decision of the hiking up the prices related vehicle insurances came up to due to the increase in cost inflation index (CII) by 5.57 per cent when taking the last year’s finance into account.
The new third party premium rates for two-wheelers with engine capacity up to 75cc is now up to Rs 569 which was Rs 519 before. On the other hand when talking about two-wheelers from 75-150cc engine capacity will witness a premium increase of 15 per cent to Rs 619. And models falling into the gap of 150cc to 350cc will see an increment of 25 per cent. On the contrary there has been a reduction in premium for motorcycles falling into the category higher than 350cc.
So this year’s budget already increased the price of purchasing new vehicles and now also the increment in insurance price will further shoot up the cost of ownership of two-wheelers in our country. Like every year, the revision of premium rates is done by IRDAI by a comprehensive study done on the market numbers related to extent of claims made and loss ratios for the insurers.