IRDAI allows insurance companies to introduce pay as many as you drive

The Insurance Regulatory and Development Authority of India IRDAI has granted general insurance companies permission to include add-ons in motor own-damage policies for two-wheelers and private cars called pay as you drive, pay how you drive, and floater policies for vehicles owned by the same individual owner.

According to the insurance regulators, the introduction of add-on alternatives would help give motor vehicle damage insurance in the country a much needed push and expand its penetration.

In its constant effort to protect the interests of policyholders and increase insurance penetration in India, IRDAI has tried to facilitate the industry to move with the times. As a step toward facilitating technology-enabled covers, IRDAI has allowed general insurance companies to introduce the following tech-enabled concepts for the Motor Own Damage OD cover, including Pay as You Drive and Pay How You Drive, according to IRDAI.

The insurance regulators have allowed the concepts of Pay As You Drive and Pay How You Drive apart from a floater policy on vehicles belonging to the same individual for two-wheelers and private vehicles.

While policyholders who choose the Pay as You Drive option can enjoy a comprehensive motor plan with premiums based on vehicle usage, those who choose the Pay How You Drive option can choose insurance based on their driving habits and behaviour. The floater insurance provision is intended to make life easier for two-wheeler and private automobile owners by removing the need to buy separate policies for each vehicle.

According to the statement by the insurance regulators, these covers will be offered as add-ons to the regular Motor-Own Damage or Motor-OD policy.