Page 215 - Motor Insurance Ebook IC 72

Guide for Motor Insurance

promotion and coordination of Road research at the
national level.

c. The Road Wing of the Union Ministry of Shipping
and Transport is also engaged in road research
and promotion of application of new techniques in
the safe construction of roads and bridges.

Q 4. Discuss the underwriting considerations relating
Ans: to (i) The use of the vehicle and (ii) the
geographical area of operation.
Motor insurance business is generally considered to be
an unprofitable class of business. In recent years the
claims experience has shown signs of deterioration.
With the increase in the number of vehicles and traffic
density, higher costs of labour and spare parts and
escalating awards for third party claims, control of
claims cost is imperative.

It is therefore most essential to adopt a sound
underwriting policy which involves not only careful
selection of risks and imposition of appropriate terms
and conditions but also close monitoring of risks at
renewal, in the light of claim experience.

The first step in underwriting is a close scrutiny of the
proposal form which must be fully complete. The

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