How car insurance policies will factor in driving behaviour. ReadThe Insurance Regulatory and Development Authority of India (IRDAI) has now allowed the general insurance companies to offer Pay As You Drive and Pay How You Drive policies based on the driving history of car owners.The insurers can also introduce a floater policy as add-ons for those with more than one vehicle or two-wheelers.The IRDAI’s move will make motor insurance more affordable and increase the penetration of vehicle insurance in the market. The car owners can now opt for insurance cover based on the number of kilometres they drive their vehicle.The new tech-enabled car insurance policies can be covered as add-ons along with the basic own damage (OD) covers. “Introduction of the options will aid in giving the much-needed fillip to Motor OD Insurance in the country and increase its penetration,” the IRDAI said in a press release.Every individual car owner has different driving needs. The new add-ons with the existing OD covers will offer more choices to the vehicle owners.The car owners can now choose insurance policies based on their driving pattern, vehicle usage and mileage. However, the finer details of the new motor insurance policies may vary depending on the insurer.Those who own vehicles with lower mileage can get more options to choose insurance policies as per their driving requirements.The car insurance premium will be decided per the owner’s driving needs, and those who use vehicles less frequently can benefit from it. Car owners don’t have the same level of requirement of vehicle usage, and now the new add-ons will help to do away with a standard premium for all practice. Those who maintain a good track record of driving can benefit from the IRDAI’s latest decision. A few industry insiders have raised concerns that the IRDAI’s decision would eliminate the cross-subsidy currently enjoyed by high usage customers.
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