IRDA's premium revision faces opposition from unions

16 March, 2013

The Insurance Regulatory and Development Authority (IRDA) has passed regulations and has revised rules to bring about an amendment in the different sections of the insurance sector.

Based on the rules formulated by the Motor Vehicle Act, it has been made mandatory that all motor-owners are required to insure their vehicles and buy car insurance, which fulfills all the requirements set forth by the law. With changing times and rise and fall in the loss or profit made by the insurance sector, the premium rates are constantly revised so as to achieve some degree of stability in this fast growing sector of the Indian economy.

The IRDA’s decision to increase third party insurance premium rates for autorickshaws has led to distress in the autorickshaw union. Third party motor insurance is to settle the claims of victims, other than owners of the vehicles. According to the proposal pertaining to the premium hike, the IRDS suggest an increase of at least Rs 300 to 400. The autorickshaw union, however, has appealed for a reduction in premium amount and has also threatened to boycott the annual renewal of transport permits of autorickshaws from April.

Increasing the premium for other vehicles like motor insurance india online and two-wheeler insurance policy is comprehendible as accident rate by such vehicles is on the rise. Rickshaw Panchayat convenor Nitin Pawar has questioned the IRDA’s decision of premium hike as the accident and mishap rate of autorickshaws is minimal. He is of the opinion that the annual premium should be reduced if instances of accidents reported are less. This revision and rise in the premium cost will surely burden the autorickshaw operators.

Revision in the premium price of private vehicles does not prove to be burdensome, as such motor insurance india online policies are procured by individuals belonging to the high-income group. Also, with the type of facilities available when you buy car insurance, a price hike on the premium amount does not affect to a great extent.

This issue of premium hike was discussed by the chief minister of Maharashtra and the demands, however, were not accepted. Pawar further stated that this issue will now be discussed with the Regional Transport Office and seek a renewal in the annual permit should the government fail to stop the revision of premium.

The Rickshaw Panchayat also stated that the local administration along with the state government, failed to maintain adequate supply of CNG. After the compulsion of using LPG and CNG for public vehicles, the government has not made necessary arrangements to ensure that adequate supply of these fuels are present for public vehicles.

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COMMENTS (1)

Guest

Jeevan

This should be stopped immediately. On what basis is IRDA raising the rates? Are they facing a shortage of income these days even when car sales are high?