Like many other things vehicle insurance premiums had also gone up in India over the years. This is about to change as the insurance companies will soon start offering analytics-based insurance where there will be option of ‘pay as you drive’. The premium of the vehicle insurance will also depend upon the driving behaviour. Insurance regulator IRDAI has announced the new policies and mentioned that these would be implement with immediate effect. With this new policy, the car owner can decide how much he wants to pay for the vehicle insurance. The regulator has also allowed insurance companies to issue floater policies for multiple vehicles belonging to the same owner.
The statement issued by IRDAI said, “The concept of motor insurance is constantly evolving. The advent of technology has created a relentless pace for the insurance fraternity to rise up to interesting yet challenging demands of the millennials. The general insurance sector needs to keep pace with and adapt to the changing needs of the policyholders. As a step towards facilitating technology-enabled covers, Irdai has permitted general insurance companies to introduce tech-enabled concepts for the motor own damage (OD) cover.”
The Insurance Regulatory and Development Authority of India (IRDAI) has approved the new insurance policies for insurance companies. According to the new motor insurance rule, one can fix the premium of the vehicle he or she uses depending up on the distance, the vehicle runs or a regular basis. This would help the people who do not take their vehicles out on the road frequently. The owner can also fix the maximum distance a vehicle will be driven in a month and can decide the premium on the basis of that. Customers will have a better control on the upfront insurance cost. For example with customer A drives 100-200 km a month and customer B driver over 1,000 kms a month. Both of them do not have to pay the same amount as insurance premium according to the new policy.
Along with this, driving behaviour of a car owner will also decide the premium. bad driving or rash driving will directly impact the insurance premium. It will be higher than that of a car that is normally driven on the road. it is said that the driving behaviour of a vehicle will be monitored through GPS. It is a said that a small device or application would installed in the car or the mobile phone which will share data related to driving style. With the help of the same devices, insurance companies can also track driving pattern of particular vehicle. After analysing the driving pattern and style, insurance companies will give scores and these scores would decide the insurance premium. Better the score, lower premium.
Along with this policy, a person can also opt for floater policies. If a person owns more than one vehicle, be it a four wheeler or a two-wheeler. Al these vehicles would be covered under this single policy. The owner does not have to go for individual policies for each vehicle. This new announcement by the authorities is believed to be make the insurance policies a lot more affordable to the owners.