[TusharK]

According to a media report, Bajaj Allianz has launched a new usage based short term motor insurance policy.



The new insurance policy enables users to insure their vehicles for a shorter period of time instead of a full year. The policy coverage is based on usage and number of kilometers covered.

It is aimed at those customers who won't be using their vehicles for a long time. Such customers can opt for theft and fire insurance policy and can plan their insurance coverage as per their usage. Instead of the full year policy, customers can pay a premium based on the number of km. When it expires, the policy can be topped up.

Source

Link to Team-BHP News

[bikertillidie]

This comes as a boon to folks who own multiple vehicles all of which are used sparingly..

Thanks for sharing.

[locusjag]

This seems to be a purely self-declaration based Usage based Insurance (UBI) product, compared to the Telematics enabled, actual miles measurement based UBI products that other insurance markets have. Self-declared UBI heavily relies on the honesty of the policyholder in accurately declaring their intended kilometres of usage. Any smart Alec who deliberately underreports their intended Kilometers for a cheaper premium and has a claim, will see scrutiny of their odometer and possibly have their claims cancelled due to the underlying fraud.

In any case, I have written about my experience with Telematics-backed Usage Based Insurance in the US - https://www.team-bhp.com/forum/india...-snapshot.html (My tryst with Usage Based Insurance - Progressive's telematics device, Snapshot)

[tp_dominator]

This will surely prove to be a boon for owners with multiple vehicle garages and as stated by locusjag above, it will depend heavily on the honesty of the policy holder.

Now, to clarify few things, this is basically a pilot project undertaken by some insurers with the approval of IRDAI. Also, you can purchase the policy cover for a maximum of 365 days and decide the number of days/kilometers you will be driving your vehicle. If the days/kilometers expire, you may top up your cover by paying additional premium.

Secondly, this is going to cover only the Own Damage (OD) portion of the insurance and one needs to have a separate Third Party (TP) insurance policy from either the same or any other insurer depending on your choice. Also, it will be governed mostly by mobile-phone apps and hence, no telematics here. The owner of all the vehicles need not be the same person but needs to be a blood relative of the original insured for him/her to be able to add other vehicles to their list.

Expect a few other insurers to come out with this product in the future, so one will also have a choice across insurers and be able to compare premiums and coverages.

[anandhsub]

I dont exactly understand how this "short term insurance" works and how usage comes into the picture. Not many details available online as well.

To me this makes sense only for those who spend like 6 months at home and 6 months away. Hence they can have insurance only for 6 months, let it expire and then renew again when they come back home. No need to pay for a full year's insurance when they are going to be using their car only for 6 months.

Not sure how it would work for those who have low usage through the year.

[paramesh3210]

Originally Posted by tp_dominator

This will surely prove to be a boon for owners with multiple vehicle garages and as stated by locusjag above, it will depend heavily on the honesty of the policy holder.

Now, to clarify few things, this is basically a pilot project undertaken by some insurers with the approval of IRDAI. Also, you can purchase the policy cover for a maximum of 365 days and decide the number of days/kilometers you will be driving your vehicle. If the days/kilometers expire, you may top up your cover by paying additional premium.

Secondly, this is going to cover only the Own Damage (OD) portion of the insurance and one needs to have a separate Third Party (TP) insurance policy from either the same or any other insurer depending on your choice. Also, it will be governed mostly by mobile-phone apps and hence, no telematics here. The owner of all the vehicles need not be the same person but needs to be a blood relative of the original insured for him/her to be able to add other vehicles to their list.

Expect a few other insurers to come out with this product in the future, so one will also have a choice across insurers and be able to compare premiums and coverages.

Absolutely my thoughts too! Since you have worded it I wont

In addition to that, we need to know how the Insurance providers will honor the claims based on ODO. The easiest excuse one can come up with is that you have a tampered ODO if they want to. How will a customer justify that its not tampered during a claim? Need to wait and see how this will help in the longer run.