Auto insurance

Now pay the car insurance premium based on “the way you drive”. Check the new rules here

Giving way to “archaic” car insurance policies, the Insurance Regulatory and Development Authority of India (IRDAI) has now decided to allow insurance companies to introduce Pay As You Drive, Pay How You Drive and floating (for those who have more than one vehicle) in addition to a car insurance policy based on the owner’s driving history, i.e. how he drives the car.

The concept of car insurance is constantly evolving. The advent of technology has created a relentless pace for the insurance fraternity to meet the interesting yet challenging demands of millennials. The general insurance industry must keep pace and adapt to the changing needs of policyholders, a said the IRDA in the notification.

And in an effort to facilitate technology covers, IRDAI has allowed general insurance companies to introduce the technology concepts for engine damage (OD) cover, he added.

Here are the 3 types of insurance coverage

Pay while you drive: This will allow users to pay for insurance based on their usage. That is, the customer must make an approximate statement of the intended use which can then be tracked using an application with geolocation. Meanwhile, the insurance company will also need to clarify the process for settling a claim in case the customer exceeds the declared usage.

Pay how you drive: This add-on will depend on how you drive your car. For this, customers will have the option to choose a live tracking of their driving in terms of speed and usage etc. The insurance company, for its part, will propose pricing based on these parameters.

Floating policy for vehicles belonging to the same individual owner for two-wheelers and passenger cars: In case a customer owns more than one vehicle – two-wheeler and four-wheeler, he can opt for this coverage for all vehicles.

How will this benefit the insured?

With these, customers will be able to better manage their multiple vehicle insurance policies and benefit from affordable premiums as they will pay based on how their vehicles are used and how they drive them, Naval Goel pointed out. , founder and CEO of PolicyX.com.

“Riders like ‘Pay How You Drive’ result in lower premiums being charged if a customer drives conscientiously, thus promoting good driving patterns.”

Meanwhile, speaking about the floating policy, Ashwini Dubey, Head of Auto Insurance Renewals, Policybazaar.com said, “It’s a win-win situation for customers who have more than one car or don’t drive not that much. For example, if person A drives their car 200-300 km per month and person B drives their car 1200-1500 km per month, they do not have to pay the same premium under the “pay as you drive” model. “.

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