Diesel car insurance to cost more
Insurance premium on diesel vehicles may rise by 30% as insurers plan to compensate themselves for higher liabilities in the segment, dealing yet another blow to auto sales that have been slowing due to high interest rates.
General insurance companies, facing steep losses in motor policy claims, also plan to factor in regional behaviour on claims to finalise premium, said two people familiar with the development. This will translate into customers in north India paying higher premium for damages and customers in the south paying more for third-party insurance.
Now, what exactly is prompting the insurance companies to go in for the premium hike for diesel cars? It is quite simple really. Diesel cars are usually bought by people who drive longer distances than petrol cars due to the higher fuel economy that diesel cars offer apart from the lower cost of diesel. Now, the more car is on the street, the more the chances of an accident, just as the classic adage of a ship being safer in the harbor than in open seas although harbors aren’t what ships are built for. So, the insurance companies will levy a higher premium on diesel cars due to the higher risks involved.