Page 19 - Insurance Times November 2021

by several times compared to premium rates of 2002-03. This increase ranges from 3 to 13 times, depending on the
category of vehicle. And average (weighted) increase comes to 6 times (1754/298).

Going by the data on incidence analysed in the previous paras, and presuming all factors other than incidence to have
remained unaltered/constant, logically the premium rates should have come down. But in reality the rates have gone up.
How come the premium rates have galloped over the years, when the incidence of accidents has been continuously falling?
Had the rates been in tune with the falling incidence of accidents (keeping for a moment, the operation of other factors
constant), they would have looked like the numbers given in table below.

Indian Motor third party premium rates applicable during 2002-03 and 2019-20 (in rupees)
Adjusted to incidence of claims

Category of Vehicle Sub Category Rates Rates Premium
for for rates for
2002-03 2019-20 2019-20
adjusted for
incidence of
accidents
Private Cars Not exceeding 1000 cc 65 276 13
Exceeding 1000 cc but not exceeding 1500 cc 77 428 15
Exceeding 1500 cc 90 1049 18
Two Wheelers Not Exceeding 75 cc 95 356 19
Exceeding 75 cc but not exceeding 150 cc 113 555 23
Exceeding 150 cc but not exceeding 350 cc 124 881 25
Exceeding 350 cc 134 1716 27
Goods Carrying Vehicles Public Carriers Other Than GVW not exceeding 7500 kg 541 2022 108
Three Wheelers GVW Exceeding 7500 kg but not exceeding 12000 kg 574 3458 115
GVW Exceeding 12000 kg but not exceeding 20000 kg 591 4291 118
GVW Exceeding 20000 kg but not exceeding 40000 kg 607 5526 121
Goods Carrying Vehicles Private Carriers Other Than GVW Exceeding 40000 kg 657 5336 131
Three Wheelers GVW not exceeding 7500 kg 485 1083 97
GVW Exceeding 7500 kg but not exceeding 12000 kg 515 2209 103
GVW Exceeding 12000 kg but not exceeding 20000 kg 528 1396 106
GVW Exceeding 20000 kg but not exceeding 40000 kg 545 2244 109
GVW Exceeding 40000 kg 587 3188 117
Goods carrying Motorised Three Wheelers and Motorised
Pedal Cycles Public Carriers Except e-carts 149 525 30
Goods carrying Motorised Three Wheelers and Motorised
Pedal Cycles Private Carriers Except e-carts 140 503 28
Four Wheeled Vehicles used for carrying passengers for hire
or reward - Capacity not exceeding 6 passengers Not Exceeding 1000 cc 285 1653 57
Exceeding 1000 cc but not exceeding 1500 cc 337 1754 67
Exceeding 1500 cc 375 2188 75
Three Wheeled Vehicles used for carrying passengers for
hire or reward - Capacity not exceeding 6 passengers Except e-rickshaw 233 1289 47
Motorised Three wheeled vehicles used for carrying
passengers for hire or reward - Capacity exceeding 6 but
not exceeding 17 Motorised Two Wheelers used for carrying
passengers for hire or reward Not Exceeding 75 cc 106 1064 21
Exceeding 75 cc but not exceeding 150 cc 124 1064 25
Exceeding 150 cc but not exceeding 350 cc 138 1064 28
Special type of vehicles Exceeding 350 cc 148 2093 30
Pedestrian controlled agricultural tractors with HP rating
not exceeding 6 HP, and Plane Loaders 62 199 12
Hearses 19 199 4
Other Miscellaneous and special type of vehicles 130 879 26
Average Rate 298 1754 60

(Incidence adjusted premium is calculated by dividing the premium of 2002-03 by five)

The Insurance Times, November 2021 19