The Insurance Regulatory and Development Authority (IRDA), on Tuesday, allowed general insurance companies to provide third party motor cover for two-wheeler for three years instead of current practice of annual renewal, a move which could be replicated for four-wheeler and commercial vehicles.
However, the policy has to be renewed every year in case of own-damage cover. Own-damage cover risk pertains to damage of vehicle due to accident. The three-year standalone third party insurance cover would provide convenience to the user and help insurance firm in collection of premium in one go.
The IRDA said the new policy had been introduced following representation from various general insurance companies for long-term motor products.
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“The authority has perused the matter and decided to introduce the Stand Alone Motor Third Party Insurance Policy for two-wheelers for a period of three years subject to...conditions,” it said in a release.
Other conditions The other conditions include no revision in premium during the period of policy, no cancellation of standalone TP (third party) cover, except in case of total loss where premium for the full unexpired years have to be refunded.
No change in other terms and conditions as against the one year products, IRDA said.
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