Centre notifies third party insurance premium for unlimited liability

The Centre on Thursday hiked the third-party motor insurance premium for various categories of vehicles from June 1, 2022. According to the Ministry of Road Transport and Highways, private cars having an engine capacity of 1,000 cc will attract rates of Rs 2,094, a 1.06 per cent increase from the premium price in 2019-20. On the other hand, vehicle owners of private cars having engine capacity between 1,000 cc and 1,500 cc will have to pay third party insurance premium of Rs3,416 as compared to Rs 3,221. However, the owners of cars with engine capacity above 1,500 cc will witness a marginal dip in premium from Rs 7,897 to Rs 7,890. 

In case of two wheelers of engine capacity between 150 cc and 350 cc, the premium has been capped at Rs1,366, while those buying two-wheelers of above 350 cc need to pay Rs2,804. The road transport ministry also set premium for the electric private cars of less than 30 kilowatts will attract a premium of Rs1,780 while those between 30 kw and 65 kw to have premium of Rs 2,904. The premium for goods carrying commercial vehicles exceeding 12,000 kg but not 20,000 kg will increase to Rs 35,313 from Rs 33,414 in 2019-20.In the case of goods carrying commercial vehicles exceeding 40,000 kg, the premium will increase to Rs 44,242 against Rs 41,561 in 2019-20.

This is the first instance when the road transport ministry has notified the third-party motor insurance rates. Earlier, these rates were usually notified by the Insurance Regulatory and Development Authority of India (IRDAI).The third-party insurance cover is basically for other than own damage and is mandatory along with the own damage cover which is purchased by the vehicle owner. In simple words, this cover is for any collateral damage to a third party, usually a human being in case of an accident.