The Policy Bazaar Show is a brand- new series that decodes the grey areas of purchasing insurance. Through the 26-episode series, the show will highlight and discuss a magnitude of topics essential to everyone trying to secure their future. From purchasing the right cover, to switching policies while shifting jobs, to ensuring a comprehensive child cover, insurance experts deliberate, simplify and shine light on the complexities of purchasing insurance in India.
In this week’s episode, our eminent anchor Vivek Law decodes the recent recommendations that have been put forth by IRDAI with Sajja Praveen Chowdary, Business Head, Motor Insurance, policybazaar.com and Jagjit Siddhu, Head-Distribution, Kotak General Insurance.
The Insurance Regulatory and Development Authority of India (IRDAI) recently proposed recommendations in the motor insurance sector that will be beneficial to the policyholders. India is severely under penetrated when it comes to the penetration rate of insurance, more so, in the insurance of motor vehicles. The IRDAI proposed many revisions in the Own Damage policy segment. Even with the Motor Vehicles Act 2019, the awareness regarding the need and importance of insuring one’s vehicles remains low. The recommendations help in making the policy covers more transparent. The calculations of sum insured and no- claim bonuses are simplified. For new car owners, the sum insured will be based on the on-road vehicle price, manufacturer accessories, as well as the road tax/registration.
Other than ensuring that the consumers are more aware about the insurance sector. The IRDAI proposal is also focused on ease the depreciation norms. The calculation based on depreciation has been standardized, in terms of shifting the depreciation based on road car value instead of the ex-showroom price, which is the basic selling value of the vehicle. The depreciation is also based on age and partial losses. The new recommendations include add-ons and better flood damage coverage.
The IRDAI has also considered the possibility of a rise in the selling of hybrid and electric vehicles. The regulatory authority has also proposed changes like not taking the CC into consideration for the calculation of insurance premium. The inclusion of these changes promotes the government’s and corporate sectors’ initiatives for eco-friendly vehicles. The recommendations are made for providing the consumer, a better understanding of the claim process, and to convince them into investing in insurance.
Watch to know more about the new recommendations in the motor insurance sectors.