30th Aug 2018 4:30 pm
IRDA has mandated that four-wheelers will require minimum three-year insurance while two-wheelers will require a five-year policy.
The Insurance Regulatory and Development Authority (IRDA), the regulatory body for all insurance and re-insurance activities in India, has announced that all new two-wheeler and passenger-vehicle sales, starting September 1, 2018, will need to have mandatory five-year third-party insurance and a three-year third-party plan, respectively, in line with the recent decision taken by the Supreme Court.
The move is expected to increase prices for two-wheelers and four-wheelers as the cost of insurance is expected to almost double. For two-wheelers, the cost is expected to go up from around Rs 427 (for 1 year) to Rs 1,045 (for 3 years) on the initial purchase cost for a two-wheeler with an engine capacity not exceeding 75cc. The move will bump up retail prices of some premium two-wheelers (+350cc) and personal vehicles (+1,500cc).