MOTOR CIRCULARS FOR THE YEAR 2001

Sr. No.	Circular No.	Date of Circular	Effective date	Subject
1	IMT.01/2001	8.3.2001		Transfer of rights to the legal heir in case of death of Insured owner of vehicle.
2	IMT/02/2001	8.3.2001	1.4.2001	Amendment of General Regulation No.2 of India Motor Tariff.
3	IMT/03/2001	8.3.2001		Reintroduction of Depreciation clause for Private Cars and Two Wheelers
4	IMT/04/2001	16.3.2001		Reintroduction of Depreciation clause for Private Cars and Two Wheelers Circular No. IMT/03/2001
5	IMT/05/2001	22.3.2001		Reintroduction of Depreciation clause for Private Cars and Two Wheelers CircularNo.IMT/03/2001  No.IMT/04/2001
6	IMT/06/2001	27.3.2001		Inclusion of Mid-term cover during currency of the Motor Policy.
7	IMT/07/2001	27.3.2001	1.4.2001	Vehicles specially designed for use of handicapped persons.
8	IMT/08/2001	8.6.2001		Rating of Isuzu Rally
9	IMT/09/2001	27.7.2001		General Regulation No.2 of India Motor Tariff.
10	IMT/09/2001	10.11.2001		Rating of Three Wheeled Motorised Rickshaws for carriage of goods only - GVW exceeding 1200 kgs.

Ref.No. IMT/01/2001                                             8th March, 2001

sub: Transfer of rights to the legal heir in case of death of Insured owner of vehicle.

Insurers are aware that the existing India Motor Tariff as also the Motor Insurance Policy do not provide for automatic transfer of the rights to the legal heir in case of death of Insured Owner of vehicle.

In order to facilitate the smooth transfer of the rights to the legal heir, it was decided at the TAC meeting held on 10th Jan., 2001 to incorporate the following provisions as a part of policy conditions.

"In the event of the death of the sole Insured, this policy will not immediately lapse but will remain valid for a period of three months  from the date of the death of the Insured or until the expiry of this

policy (whichever is earlier). During the said period legal heirs of the Insured to whom the custody and use of the Motor Vehicle passes may apply to have this Policy transferred to his/her/their names or obtain a new insurance policy for the Motor Vehicle.

 Where such legal heirs wish to apply for a transfer of this policy  or obtain a new policy for the Motor Vehicle he/she/they should make an application as per his/her/their requirements within the

aforesaid period to the Company. All such applications should be accompanied by :-

 a) death certificate in relation to the insured

b) proof of title to the Motor Vehicle

c) copy of this Policy".

 The Company reserves its right to abide by any order of the court in regard to declaration about the legal heir/heiress and ownership of the vehicle and the nominee will not have any right to dispute such order of the Court.

 The above decision is effective from the date of this circular for all renewals and new business.  Insurers are requested to inform their operating offices accordingly.

Secretary           

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Ref.No. IMT/ 02/2001                                                 8th March, 2001

Sub : Amendment of General Regulation No.2 of India Motor Tariff

It can also be extended to cover additional liabilities provided in the Tariff.

Ref.No. IMT/ 03/2001                                         8th March, 2001

sub: Reintroduction of 'Depreciation Clause' for Private cars and Two Wheelers

Insurer's attention is drawn to Motor Circular No.IMT/REV/98(2.98) dated 1st June 1998 where in the 'Depreciation Clause' appearing in Private car 'B' policy and Motor Cycles 'B' policy is deleted with effect from 1st July 1998.

You are further advised that the Tariff Advisory Committee at its meeting held on 10th January 2001 has decided to re-introduce the 'Depreciation Clause' as prevailing prior to 1.7.1998 and to withdraw the loading of 10% on 'Own Damage' premium.

Accordingly schedule of premium of private cars and Motor Cycles/scooters shall be as under :-

PRIVATE CAR

 

Insured's Estimate of Value Rs.	CUBIC CAPACITY
	Not Exceeding 1500		Exceeding 1500
	Zone A	Zone B	Zone A	Zone B
15,000	510	720	-	-
20,000	618	868	-	-
30,000	833	1,163	878	1,238
40,000	1,048	1,458	1,093	1,533
50,000	1,263	1,753	1,308	1,828
60,000	1,478	2,048	1,523	2,123
70,000	1,693	2,343	1,738	2,418
80,000	1,908	2,638	1,953	2,713
90,000	2,123	2,933	2,168	3,008
100,000	2,338	3,228	2,383	3,303
110,000	2,553	3,523	2,598	3,598
120,000	2,768	3,818	2,813	3,893
130,000	2,983	4,113	3,028	4,188
140,000	-	-	3,243	4,483
150,000	-	-	3,458	4,778

MOTOR CYCLES & SCOOTERS

(Other than Auto Cycles Or Mechanically Assisted Pedal Cycles)

 

Cubic Capacity	Own Damage
Upto 150	Rs.80+ 1.00% on IEV
Upto 250	Rs.100+1.00% on IEV
Over 250	Rs.120 + 1.00% on IEV

 AUTO CYCLES OR MECHANICALLY ASSISTED PEDAL CYCLES:

Any Motor Cycle with an engine capacity exceeding 35 cc but not  Own Damage exceeding 75 cc with a constant gear ratio (and having pedals for ) self propulsion

Rs. 30+0.40% on IEV

The following clauses should be incorporated under Section I : 'Loss or Damage' of Private Car 'B' Policy and Motor Cycle/Scooter 'B' Policy as under :-

Subject to a deduction for depreciation at the rates mentioned below in respect of parts replaced :

1. For all rubber nylon plastic parts tyre and Battery - 50%

2. For all parts made of glass Nil

3. All other parts Nil

 

AGE OF CAR	% OF DEPRECIATION
Upto 6 months	Nil
Between 6 months and 1 year	5%
Between 1 year and 2 years	10%
Between 2 years and 3 years	15%
Between 3 years and 4 years	25%
Between 4 years and 5 years	35%
Between 5 years and 6 years	.40%
Over 10 years	50%

As a result of re-introduction of "Depreciation Clause" the word "Depreciation" should be inserted under exclusion (a) of Private Cars "B" Policy and Motorcycles/Scooter "B" Policy, between words 'consequential loss' and 'wear and tear'.

In view of the above amendments the Endorsement number 75 stands deleted.

The above amendments shall come into force for all new policies issued and existing policies renewed on or after 1st April, 2001.

Insurers are requested to inform their operating offices immediately.

Secretary    

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Ref. No. IMT/04/2001                                     16th March, 2001.

CORRIGENDUM

Sub: Reintroduction of 'Depreciation Clause' for Private Cars and Two Wheelers Circular No: IMT/03/2001

Insurers attention is invited to the Circular No: IMT/03/2001 dated 8th March 2001 in the above connection.

It may please be noted that a typographical error has occurred on the 3rd page in respect of deduction for depreciation against item 3 "All other parts" pertaining to

AGE OF CAR which should read as under:-

All other terms and conditions of the said circular remains unaltered.

The inconvenience caused is regretted.

Secretary    

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Ref. No. IMT/05/2001                                                 22^nd March 2001

Sub: Reintroduction of 'Depreciation Clause' for Private Cars and Two Wheelers Circular No: IMT/03/2001 and Circular No. IMT/04/2001

Insurer's attention is invited to the circular No. IMT/03/2001 dated 8th March 2001 and its' corrigendum IMT/04/2001 dated 16th March 2001 in the above connection. They are required to incorporate the following changes in the Tariff:

1) In view of re-introduction of the 'Depreciation clause' and withdrawal of 10% loading on 'Own Damage' premium, the N.B.3 of the Schedule of Premium (Private Car) RATES FOR OWN DAMAGE SECTION should be amended as follows:

N B 3:-Intermediate values and values in excess of those shown in the OD Schedule shall be charged at Rs.2.15% for Zone A and Rs.2.95% for Zone B calculated on the difference to the nearest rupee.

2) The Endorsement No.IMT 75 which was deleted vide Circular No. IMT/03/2001 dated 8th March 2001 has been re-instated in so far as it pertains to the mode of settlement of claim on total loss basis, with amendment as under:

IMT 75.(Applicable to Private Cars and Motor Cycles/ Scooters only)

"Notwithstanding anything to the contrary contained in Section 1 hereunder, it is hereby expressly understood and agreed that Total loss claims shall continue to be settled on the basis of Insured's Estimated Value (IEV) or the Market Value, whichever is less. Subject otherwise to the terms, exceptions, conditions and limitations of the policy."

3) In the Specimen Premium computation table for Motor Cycle/ Scooter Policy, the Own Damage (IEV) premium shall be amended to Rs.1.00% .

• All other terms and conditions of the circulars mentioned above remain unaltered. Insurers are requested to inform their operating offices suitably.

Secretary

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Ref. No. IMT/06/2001                                                 27th March, 2001

Sub: Inclusion of Mid-Term Cover during currency of the Motor Policy

Insurers are aware that the existing provisions in the India Motor Tariff does not allow grant of mid-term cover for earthquake, riot, strike and flood during the currency of the policy. TAC at its meeting held on 19th March, 2001 has decided to permit inclusion of mid-term cover for the above perils during the currency of the Motor policy by amending the existing General Regulation No. 25 as under:-

" 25. Addition of benefits during currency of policy / Mid-Term cover for riot, strike, earthquake, flood perils during currency of policy.

25(A) Addition of benefits during currency of policy

Any extra benefit may be added and limitation cancelled once only during the currency of an annual policy up to expiry date on a pro-rata basis subject to the minimum premium applicable. The conditions governing these exceptions will be found under the appropriate heading in the Tariff.

When an extra benefit has been so added or limitation so cancelled, no return of the additional payment by the Insured may subsequently be allowed.

25(B) Mid-Term Cover

Generally it is not permissible to grant mid-term cover for riot, strike, earthquake and flood perils. The following provisions shall apply, where such covers are granted mid-term:-

i) Insurers must receive specific advice from the insured accompanied by payment of the required additional premium

ii) Cover shall commence 15 days after the receipt of the premium

iii) Recovery of the discount already allowed in the Own Damage premium for deletion of the perils.

iv) Loading of 5% on the pro-rata premium for the balance period.

v) No Claim Bonus should not be allowed on the premium collected for Mid-Term cover. However, Malus if applicable, will apply on the additional premium collected. "

The above decision is effective from the date of this circular. Insurers are requested to inform their operating offices accordingly.

Secretary       

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Ref. No. IMT/07/2001                                                 27th March, 2001

Sub: Vehicles specially designed for use of handicapped persons

Insurers' attention is drawn to General Regulation No. 29 of India Motor Tariff wherein a discount of 33 1/3 % is allowed on the premium of vehicles specially designed for use of handicapped persons. TAC at its meeting held on 19th March, 2001 has decided to extend the above discount to the vehicles modified to carry physically handicapped persons also. In view of the above decision, General Regulation No: 29 is revised and the revised GR 29 shall read as under:-

"29. Vehicles specially designed / modified for use of or carrying handicapped persons.

A discount of 33 1/3% may be allowed:

(a) on private vehicles (including two/three wheelers) specially designed for the use of handicapped persons

OR

(b) to vehicles owned & used by Institutions engaged exclusively in services blind, handicapped and mentally retarded child/ adult.

OR

(c) on private vehicles (including two/three wheelers) specially modified for handicapped persons which have been suitably endorsed in the Registration Book by the Registering Authorities.

Minimum premium for the above policy will be Rs.15/-.

The above decision will be effective from 1st April, 2001. Insurers are requested to inform their operating offices suitably.

Secretary   

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Ref. No. IMT/08/2001                                                     8th June 2001

Re: Rating of Isuzu Rally

We have received a request for rating of the above rally, which is being held as under:-

a) Rishikesh - Leh : June 11 - June 26.

b) Leh - Rishikesh : June 29 - July 10

c) Rishikesh - Leh : July 13 - July 24

d) Leh - Rishikesh : July 27 - August 7.

Insurers are advised to rate the proposed rally as per the following rates, terms and conditions.

1) The additional risk of hill climbing, dexterity test, etc would be covered under the Standard Policy by charging a loading of 300% on Short Period Scale of rates for both Own Damage & Third Party cover.

2) The policy should not be extended to give PA cover for riders.

3) Extension should not be allowed to the passengers carried on the vehicle.

4) Indemnity should not be provided to the promoters of the rally.

Insurers are requested to inform their operating offices suitably.

Secretary             

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Ref. No. IMT/09/2001                                                 27th July, 2001

Sub: General Regulation No. 2 of India Motor Tariff.

Insurer's attention is drawn to TAC Circular No. IMT/02/2001 dated 8th March, 2001, in connection with amendment of General Regulation No. 2 of India Motor Tariff which was effective from 1.4.2001. Arising out of several queries from the Insurers in connection with exact implication of the amendments, the matter is hereby clarified as follows:

1. Tariff has to be observed by all insurers - as a benchmark, below which no insurance company can go. The insurers are also not permitted to cancel or delete covers that are granted and are available to insureds under the terms and conditions of the Tariff. For example, if under a motor policy, certain essentials are covered, an insurer cannot cut down some risks from being covered and charge a premium different from the tariff.

2. An Insurer, cannot using the clarification - ' Tariff rates are the minimum rates for Policy A & Policy B and insurers may charge rates higher than those provided under the tariff' - enhance premium rates across the board to affect all insureds. The clarification only enables an insurer to pick and choose an insured, on the basis of claim profile, to enhance premium. It should not be read to enable an insurer to increase the premium rates generally - behind the TAC which would mean a breach of tariff conditions.

3. If insurers are adding to the covers normally available and covered by tariff (conditions and terms ), then they have to file a profile with TAC and go by the 'file and use' regime.

Secretary

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