Till a month ago, Kapoor used to drive 20 km up and down a day, from his house in Hauz Khas to his workplace in Rajpath, New Delhi. He has now moved jobs, and his new office is just a 10minute walk from his home.
Kapoor expects to save a lot of money now; he will fuel only when he goes out with his family, possibly over the weekends. True, less use of the car is less spend on fuel. But the premium on the car insurance is still going to burn a hole in his pocket, isn’t it?
Not necessarily, if Kapoor buys any of the recently launched motor products under the ‘regulatory sandbox’ guidelines that offer usage-based cover. Last August, the Insurance Regulatory and Development Authority of India (IRDAI) came up with guidelines on the regulatory sandbox, and invited applications from companies to pilot innovative tech-based products.
The regulator received several proposals from insurers in the health and motor space. Among these is Liberty General Insurance’s ‘Pay for the Distance’ feature under its private car package policy that charges customers a premium only for the distance they drive. Another is ICICI Lombard’s floater cover for motor vehicles, where an app-based interface will link the multiple vehicles of the owner together and offer coverage. Yet another is Edelweiss General’s usage-based floater policy.
So, should you go for these policies? While Liberty General’s new product is already available online, the rest have launched pilots, but these are not open online.
What’s regulatory sandbox?
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