Third-party motor insurance to increase from tomorrow: Things you should know

If you are looking to buy a new car or a two-wheeler tomorrow or later, get ready to shell out more to drive them out of the showroom. Price of passenger vehicles is set to rise as the rate of third-party motor insurance has been hiked across various categories. The new rates will be applicable from tomorrow, June 1. A notification issued by the Ministry of Road Transport and Highways had earlier shown how the new rates will affect pricing of new cars and two-wheelers in coming days.

New cars and bikes will cost more as third-party insurance rates hiked from June 1. (MINT_PRINT)
New cars and bikes will cost more as third-party insurance rates hiked from June 1.

According to the new third-party motor insurance rates, passenger cars with an engine of 1.0-litre capacity will have to pa of 2,094, up by 22 from 2,072 paid earlier. Third-party motor insurance rates for passenger cars in the 1,000 cc and 1,500 cc bracket used to be 3,221. From June 1, customers will have to pay 195 more for the same. However, those looking to buy cars with engine capacity of more than 1,500 cc will have to pay less, but it is a nominal 7 difference.

Thos looking to buy two-wheelers above the 150cc category will see an increase of 15 percent in the rate. Bikes or scooters with engine capacity between 150cc and 350cc will have to dish out a premium of 1,366. Those looking to buy two-wheelers with more than 350cc capacity engine will have to pay 2,804 as premium

There is some relief for those looking to an electric vehicle or a hybrid vehicle. The new rates will offer a discount of 7.5 per cent on the premium for hybrid electric vehicles. Pure electric cars which do not have more than 30KW of battery will have to pay a premium of 1,780. For EVs with battery capacity between 30 KW and 65 KW will attract a premium of 2,904.

The third-party insurance cover is for other than own damage and is mandatory along with the own damage cover that a vehicle owner has to purchase. This is the first time that the ministry itself has issued a notification on the third-party motor insurance rate hike. Earlier, the third-party rates were notified by the Insurance Regulatory and Development Authority of India (IRDAI).

First Published Date: 31 May 2022, 14:50 PM IST
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