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Individuals who drive two- and four-wheelers will now have a mandatory personal accident insurance of ₹15 lakh.
Under the existing norms, the compulsory personal accident (CPA) cover under both liability-only and package polices for two-wheelers and private cars/commercial vehicles is ₹ 1 lakh and ₹2 lakh, respectively.
But now, the Insurance Regulatory and Development Authority of India (IRDAI) has provided for a steep rise in the sum insured with immediate effect. “A minimum capital sum assured of ₹15 lakh should be provided under CPA cover for owner-driver under liability only, under Section lll of package policies to all classes of vehicles and bundled covers...’’ the regulator said in a directive sent to the general insurers.
The premium will be ₹ 750 per annum.
The significant increase in cover by the regulator came in the wake of a recent direction from the Madras High Court in a case between a public sector general insurer and an individual.
It asked the regulator to enhance the compulsory personal accident cover from ₹1 lakh to at least ₹ 15 lakh so that “it will add to some succor or solace to the victims of road accidents who are owners of the vehicle who may incidentally sustain bodily injury or death.’’
The owner-drivers also have the option of a cover over and above ₹ 15 lakh on payment of a higher premium.
For CPA cover under long-term motor policies, insurers may fix the premium in line with their current pricing methodology.
Impact
Given the increasing number of road accidents, the significant increase in personal accident over “provides much-needed financial support to the policyholder and their family members if she/he is disabled or succumbs to injury due to an accident,’’ Tapan Singhel, MD and CEO, Bajaj Allianz General Insurance, told Business Line .
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