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You may soon be able to insure new cars and two-wheelers on the on-road price of the vehicle for three years from the date of purchase.
The sum assured will cover the on-road price including the invoice value, the road tax, the registration charge and the value of all the accessories fitted in by the manufacturer. as of ow, the cover is only for the invoice price.
This is one of the 24 key recommendations of a working group constituted by the Insurance Regulatory and Development Authority of India (IRDAI) to revisit the product structure for motor own-damage cover in the wake of fast-changing technologies and ecosystems.
Adoption of telematics
The group has made the calculation of depreciation and sum assured simple. It has recommended that telematics be adopted for motor insurance by pooling in data from various sources to arrive at a common platform. The Insurance Information Bureau of India will act as a data repository.
For vehicles older than three years, the sum assured will be arrived at on the basis of a new depreciation table suggested by the panel. The table has been suggested for 15 years.
For commercial vehicles, the sum assured should represent the current day invoice value plus the cost of the body building, it said. For total loss and theft claims, the amount payable should be the sum assured. The panel has also suggested a standardised no-claim bonus grid for long-term policies. The regulator is likely to come up with the new set of guidelines in a couple of months.
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