Business News of Wednesday, 26 December 2018
Source: Starrfmonline.com
2018-12-26
File photo
Third Party Premium of vehicles in the country will from January 1, 2019 be pegged at a flat late, the National Insurance Commission has announced in a statement.
There will also be ‘no claim discount’ on third party insurance beginning next year, the statement said.
“The flat premium for TP Motor Insurance will be 90% of the current basic
premium of all other classes of vehicles.
“All other charges and additional payments will then be added to arrive at
the final premium payable by the policyholder.
“‘No Claim Discount’ (NCD) shall not apply to Third Party Motor Insurance,” the statement added.
The directive is applicable to new businesses in the ensuing year.
Below are details of the directive
1,. The directive will initially apply to Third Party (TPJ Motor Insurance and the Third Party components of the other classes of Motor Insurance policies only, such as Comprehensive and Third Party, Fire and Theft policies.
2. The following conditions will apply:
i. The TP premium will be a flat premium.
ii. The flat premium for TP Motor Insurance will be 85% of the current basic
– premium of Private Individual and Private Corporate vehicles.
iii. The flat premium for TP Motor Insurance will be 90% of the current basic premium of all other classes of vehicles.
iv. All other charges and additional payments will then be added to arrive at the final premium payable by the policyholder.
v. ‘No Claim Discount’ (NCD) shall not apply to Third Party Motor Insurance.
vi. The fleet discount is capped at a maximum of Lo/o for all categories of
vehicles. For the avoidance of doubt, the fleet discount of Lo/o applies to
Third Party policies, only. A fleet is defined as a minimum of five cars.
, vii. The minimum limit of Personal Accident IPAJ cover is GHS 5,000 for all classes and categories
viii. The minimum limit on Third Party Property Damage (TPPD) is GHS 5,000
for all classes and categories.
ix. The applicable rate for additional TPPD cover is to/o of the sum insured for Private Individual vehicles.
x. The applicable rate for additional TPPD cover is 2o/o of the sum insured for all other vehicles.
xi. Loadings for cubic capacity [CC) and age of the vehicle will be applied at the discretion of the insurer. These loadings shall in no way reduce the
premium payable by the policyholder if the loadings had not been applied.
3. The Third Party insurance premium component of Comprehensive Motor
Insurance and Third Party, Fire & Theft Motor Insurance will be arrived at using the criteria enumerated above.
4. The directive is applicable to new businesses written effective |anuary 1, 20L9. lt does not apply to the renewal of businesses that existed prior to January 1, 2019.
Please note that the penalty for the breach of this directive is 20 times the premium that should have been charged.