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Traffic rules will have to be breached heavily, preparations are being made to apply traffic violation premium on insurance

This premium has been suggested to be kept in addition to the motor’s own losses, basic third party insurance, additional third party insurance and compulsory personal accident insurance premiums.

A working group of insurance regulator Insurance Regulatory and Development Authority of India (IRDAI) has recommended introduction of ‘Traffic Violation Premium’. This premium will be with insurance for self and third party losses.

What is this premium: The group constituted by the regulator has also suggested to add a fifth clause in motor insurance for this. Under this, it has been suggested to add “Traffic Violation Premium”. This premium has been suggested to be kept in addition to the motor’s own losses, basic third party insurance, additional third party insurance and compulsory personal accident insurance premiums.




In the draft issued by IRDAI, necessary suggestions have been sought from the concerned parties till 1 February 2021 on these recommendations. According to the proposal this premium will be related to the future of the vehicle. In respect of a new vehicle it will be nil. This premium will be determined by different violations such as driving drunk and parking the wrong place. Insurance companies will get the invoice data for violation of traffic rules from NIC (National Informatics Center).

Traffic violation premiums will be payable by the registered owner of the vehicle, whether the person or the entity. The traffic violation point will be assessed when the motor insurance buyer approaches the General Insurance Company for taking any type of motor insurance. Accordingly, the premium will have to be paid.

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