Key highlights
- Third-party insurance premium likely to be revised soon
- A hike of up to 10% is expected soon
- Segments like the school buses will witness a minimal hike
Continuing the discipline of revising the third-party insurance rates annually, the government has decided to hike the premium rates by up to 10% for 2025. Read all the details about the new insurance premium rates below.
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Third-party insurance to get costlier soon
As per an online report, the Ministry of Transport (MoRTH) has decided to increase the premium rates for the third-party insurance due to the consistent pressure from the insurers.
The report states that the government is expected to hike the insurance rate of the third-party by up to 10%, depending on the vehicle category.
Mind you, the rates for the vehicle insurance premium are revised annually. However, since 2021, the rates have witnessed a minimal hike.
The new insurance premium rates are expected to affect the private four-wheelers and two-wheelers majorly. However, the segments like school buses are likely to undergo a minimal hike.
It is also reported that the insurers had written to the government in April 2025 that they require at least a 5-15% hike in the rates to remain rational.
Due to the upfront customer claims, distorted claim cycle in the pandemic, and rising court awards, the insurers are undergoing difficulties in operations and claim settlements.
As far as the third-party insurance rates are concerned, cars up to 1,000cc have a premium of Rs 2,100, while the cars ranging from 1,000-1,5000cc have a premium of Rs 3,400 currently.
Our verdict
The annual revision of the insurance rates is a regular process. However, a 10% hike is a steep increase in the rates. The official announcement is due now. More clarity will be achieved once the new insurance premium details are out.