New automobile and two-wheeler buyers must pay upfront for insurance coverage that lasts at least three and five years, respectively. Long-term premium payments would avoid customers from the hassle of regular renewals while correspondingly increasing the initial outlay on new cars.
The Custom Of Paying An Annual Premium
Buying third-party car insurance online is required for all road-worthy vehicles, however, the SC has instructed insurers to give long-term, third-party covers due to lower penetration.
Many owners either avoid annual renewals or purchase policies that may not completely cover risk as vehicles get older and their depreciation increases. This programme aims to increase the number of vehicles covered while improving sector-wide penetration. The debate over having car insurance or not will be resolved. There will be better and more insurance coverage for third-party automobiles.
In the event of responsibility claims for fault, the insured amount is limitless. Separately, the insurance regulator instructed insurers to start distributing long-term plans on September 1 and use their underwriting standards.
Both the long-term package cover for “own-damage” and “third-party” and a combination of long-term third-party and one year for own vehicle damage are options that insurers can provide. *
For new vehicles, the period is three years, and for two-wheelers, it is five years. The regulator has instructed insurance companies to collect the whole term’s premium at the moment of sale.
Except in cases of double insurance, vehicle disuse, sale, or transfer, third-party coverage cannot be canceled by either the insurer or the policyholder during the policy term of car insurance. Additionally, the own-damage component would only be eligible for the no-claim incentive once the insurance term had expired. The commission for long-term coverage will be separately prescribed by the regulator, and it will only be paid out on the gross written premium recognised for the year. *
Purchasing car insurance for 3 years cover is a crucial step that new vehicle owners must take. Not only does it offer financial protection in case of unforeseen accidents or incidents, but it also ensures compliance with legal requirements. It is essential to carefully review and compare policies to select the most suitable coverage option that meets individual needs and budgets.
The new regulation of purchasing long-term insurance coverage is a significant step aimed at enhancing road safety and ensuring financial security. It not only simplifies the insurance process but also promotes responsible ownership by ensuring continuous coverage for a longer duration. By adhering to this requirement, new vehicle owners can better protect themselves, their vehicles, and other road users, contributing to an overall safer and more responsible driving environment.
* Standard T&C Apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.