IRDA sets up committee on third party motor cover

IRDA sets up committee on third party motor कवर

New Delhi: Insurance regulator IRDA today set up a committee to look into issues related to third party insurance cover for motor vehicles.

The IRDA constituted a committee under chairmanship of M Ramaprasad Member (non-life) and 12 other members, including representatives from non-life insurance industry.

A third party insurance is a policy under which the insurance company provides cover for motor vehicles for injuries or damage done to a third party.

"Offering motor third party liability cover to commercial vehicles has been a challenge for non-life insurers in view of the tariff controls prevailing and non-availability of credible data and statutory provisions," Insurance Regulatory and Development Authority (IRDA) said in an order.

It further said that since 2006, many issues relating to the adequacy of the premium charged for the cover and various alternatives to address the issue were brought to the notice of the insurance regulator.

The terms of reference of the committee are to review.the current arrangement and examines the possibility and modalities to be adopted for creating declined pool of commercial vehicles to ensure the availability of third party liability cover to all commercial vehicles.

Besides, to examine the possibility to provide third party liability cover to the driver, in addition to the vehicle.

Also, the methodology of pricing to provide the necessary adequacy and reasonableness of third party insurance cover. The time frame for submission of the recommendations by the committee is three months,