The Insurance Regulatory and Development Authority of India (IRDAI) is planning to come out with its final report on telematics in motor insurance by the end of current financial year.
IRDAI Chairman Subhash C Khuntia said the regulator is going through the final report on telematics which will motivate people with better behaviour. Currently, motor insurance in India is being priced based on parameters like the make and model of the vehicle, its capacity, the geographical use etc. But in actuality, there are various parameters to be considered in the assessment of risks that a vehicle is exposed to such as the upkeep of the vehicle, how frequently it is driven, what distance it is driven for, the quality of roads it is driven, the driving habits of the driver and so on. “Consideration of these factors will lead to a more meaningful risk assessment and provide for a more accurate mechanism for pricing,” he said.
In telematics motor insurance, a telematics box (also commonly known as a black box abroad) is fitted to the car which then measures various aspects of how, when and where a person drives. Speaking at the CII’s Insurance and Pensions Summit, Khuntia said, “There are lot of complaints about insurance products which are misleading. If we have to put fixed deposits with the bank, we have no problem to look at terms and conditions because all banks will have similar terms and conditions ….”
‘Develop personal savings’
Mumbai: As the old age population is going to double in the next 30 years making it a big challenge for the government to provide for their care, developing personal savings is the only way to address this issue, Hemant Contractor, Chairman, Pension Fund Regulatory and Development Authority (PFRDA) has said.
“There are about 130 million old age people (above the age of 60 years) at present, and the number is likely to go up to 300 million by 2050, posing a big social challenge for the country to provide for their care if they are not saving for their old age,” Contractor said at the CII’s summit on Indian insurance and pensions sector. —ENS