[Arjun Reddy]

Originally Posted by greenhorn

If a car is totaled in the first year, will insurance companies give a refund of the remainder similar to the life tax refund?

A lot of grey areas. Until someone actually buys the bundled policy we will not know. Ideally they should refund if the car is totalled, just like you can claim the road tax back for the remaining years paid for.

I am actually worried as to how they will adjust the no claim bonus on FP Insurance if taken out for 3 years?

I expect big discounts on FP Insurance,if bundled for 3-5 years. The insurance company knows that you will remain with them.

[hemanth.anand]

Originally Posted by greenhorn

If a car is totaled in the first year, will insurance companies give a refund of the remainder similar to the life tax refund?

My guess...
If the terms and conditions say that refund is possible, then IDV also will change every year
If the IDV stays the same for the entire term of 3 years, Then refund will not be given

[Chethan B G]

IMO; Third party insurance should be mandatorily collected for the life of the vehicle, as is applicable for Road tax.

It is the duty of every citizen to ensure that he/she is able to cover the damages (if at all) done to a third party, who is a fellow citizen. Covering personal damages and that of the vehicle is ones own requirement which can be at the discretion of the individual.

But this can reduce the overall collection of the insurance companies, as majority of the people would shy away from getting the comprehensive insurance package added year on year.

While the revenue from TPI will increase, total revenues can decrease. This is like collecting 5k in the place of 30k.

[knightrider_7]

The new insurance rates from tomorrow (only for 3rd party insurance):

[saket77]

Originally Posted by knightrider_7

The new insurance rates from tomorrow:

This is only for the 3rd party premium. What about the extra payment required for 'own damages'? That payment will be substantial and the final outgo much higher than what's depicted in the picture.

Thanks,
Saket.

[knightrider_7]

Originally Posted by saket77

This is only for the 3rd party premium. What about the extra payment required for 'own damages'? That payment will be substantial and the final outgo much higher than what's depicted in the picture.

Thanks,
Saket.

Yes its only for 3rd party premium. Thanks for pointing out. I have added it to the above post.

The total premium including own damage premium will be much higher as you said.

Is there an option to purchase own damage policy cover on an yearly basis in this new scheme?

[saket77]

Originally Posted by knightrider_7

Yes its only for 3rd party premium. Thanks for pointing out. I have added it to the above post.

The total premium including own damage premium will be much higher as you said.

Is there an option to purchase own damage policy cover on an yearly basis in this new scheme?

As of now, there is no option to purchase 'own damage only' policy. Third party is & was mandatory, but first party isn't. I would be interested in knowing if insurance companies will be separately offering first party policies to those who have taken 3/5 year TP policies or it will be clubbed and sold as normal comprehensive policies?

Regards,
Saket.

[Chethan B G]

I think this will lead to multiple policies like what people generally have for medical insurance.

People will buy TPI from the dealer during the purchase for multiple years as this is mandatory. Later shop for top-up.

As this is not mandatory, consumer will not be in a hurry nor be obligated and will find plenty of options in the market.

This will be interesting and good for the consumer IMO. Good initiative by SC. 👍

[SJM1214]

New vehicle owners have to buy long-term cover.

Aug 30, 2018, 07.24 AM IST
From September, buyers of new cars and two-wheelers must purchase upfront insurance cover for at least three and five years, respectively. Long-term premium payments would proportionately raise the initial outgo on new vehicles, but save consumers the trouble of yearly renewals.

As the practice of annual premium payments gets a quiet burial, the initial insurance cover on a new private car exceeding 1500 cc will be at least Rs 24,305, up from abase of Rs 7,890 now. For bikes with an engine capacity beyond 350 cc, the buyer must pay Rs 13,024 against Rs 2,323 currently. Insurance premiums can vary across models.

On July 20, the Supreme Court ordered that third-party insurance cover for new cars be for a period of three years, and five years for two-wheelers. The order would apply to all policies sold from September 1. The SC directed insurers to offer long-term, third-party covers because of lower penetration, although insurance is mandatory for all road-worthy vehicles.

Full News at : https://economictimes.indiatimes.com...w/65589769.cms

[shibujp]

All this is a bit confusing. The intent of the judgement is to improve compliance of third party insurance. Why is any body's guess. Anyone who has pursued a motor vehicle case will know - between corrupt cops, an over loaded justice system and a lackadaisical attitude to determine accident cause - third pary is something that the third party almost never gets.

So what's the deal for renewals? Can policies be renewed for just a year once the three/five year period expires? Can I have a three year third party cover and a own damage cover that is renewed yearly?

Drive on,
Shibu.

[locusjag]

Originally Posted by greenhorn

If a car is totaled in the first year, will insurance companies give a refund of the remainder similar to the life tax refund?

The portion of the premium that is earmarked for the future (called "unearned premium" in the industry) should be refunded to you.

The insurance industry is very mindful of the fact that the upfront premiums are not really theirs until their customers' policy terms have been fully completed. Hence the unearned premiums remain on the liability side of the balance sheets of all insurance companies, with the tacit understanding that they must be returned to customers if they should cancel their policies at any time, or as in your example, if the insured object ceases to exist.

[Turbanator]

Again, one of judgement that is far off from the ground realities. I am yet to see anyone, be it be a 2 wheeler or 4 wheeler, not going for Full Insurance in the initial years of purchase. With no clarity on 3 Years only for 3rd party or complete, this will add up to the costs of new vehicles. Besides, 3 Years may be a long time to stick with one provider.

[Arjun Reddy]

Most importantly, Insurance is neglected once the vehicle is old and not when it is new.

Not sure how this will bring in the compliance after the third year.

The only way forward is to empower the traffic cops with steep fines for the same.

[Arjun Reddy]

Frequently asked questions answered by the Economic times.

https://economictimes.indiatimes.com...ign=ETFBWealth

[hemanth.anand]

I compiled the historical prices of Third party premium using the premiums I had paid, TBHP posts and some news reports.
In the last 3 years, the 2-wheeler Third party insurance premiums have increased considerably compared to cars (Especially vehicles above 350cc)
For cars, there is a gradual rise and the curves of all three categories are almost parallel to each other although premium for cars less than 1000cc has decreased.