General Insurance News: Motor third-party premium increases by 39% in Quarter 1

The general insurance industry has recorded a 22% growth in topline during the first quarter, registering a total premium of Rs 14,046 crore compared to Rs 11,478 crore in the year-ago period following an increase in motor third-party premium for vehicles. 
With effect from April 2011, insurance regulator IRDA had allowed insurance companies to hike premium on third-party cover by 10% for cars and by up to 65% for commercial vehicles. This increase has resulted in the third-party premium collections soaring by 39.2% to Rs 2,043 crore in the first quarter from Rs 1,467 crore a year ago. Third-party cover is the compulsory for vehicle owners as it compensate victims of road accidents.

Part of the increase is also on account of the increase in the number of vehicles. This is evident from the increase in motor own-damage cover, which compensates the owner for accidental damage to the vehicle. The own-damage premium for the first quarter rose 23% to Rs 3,201 crore from Rs 2,600 crore a year ago.

Data released by the insurance regulator shows that motor and health insurance continue to dominate non-life segment with market share of 60% and 26%, respectively.

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