- Long-term policies withdrawn
- IRDAI saw a lot of issues
- Long-term third party will exist
The Insurance Regulatory and Development Authority of India (IRDA) has decided to withdraw long-term two-wheeler insurance policies from 1st August.
According to the insurance regulator, there were a number of reasons due to which this step was taken. There was a lack of uniformity in the no claim bonus (NCB) structure which could lead to a lot of confusion and dissatisfaction amount policyholders. The regulator said that it had noticed some issues and concerns in the performance of these long-term policies.
The insurance companies will continue to offer three-year or five-year third party policies. Third party insurance covers financial liabilities of two wheeler owners in case the vehicle is involved in an accident causing death/injury to a pedestrian or person(s) in another vehicle.
This new development is likely to bring the on-road cost of the bikes and scooters down that is bound to affect the sales in a positive way.
