Following
the increase in prices of imported car spare parts, due to sharp fall of the
Rupee, the general insurance companies are forecasting a rise in car insurance
premium in the coming days.
"Usually, insurance premium is a small percentage of the price of a car.
As car prices have gone up due to rise in cost of imported spare parts
following the rupee fall, premium may also go up during the time of
renewal," said Chief Executive of Bharti Axa General Insurance Sri
Amarnath Ananthanarayanan.
The Indian rupee has seen a sharp decline of more than 20% since May this year and is currently hovering around Rs.66 per dollar; this has raised costs of imported spare parts of most of the automakers in the country. Auto companies such as Mercedes-Benz, Audi and BMW, which use more imported parts than others, have increased prices in the recent months on the back of rising import cost.
Sri KG Krishnamoorthy Rao, MD & CEO, Future Generali India, said, “If the costs of spares go up, this will definitely increase the claim settlements for us. Also, if you see on a six month average, the labour cost has gone up by 10-15 % for manufacturers. So, a 15-20 % hike in the insurance premium is expected.”
The Indian rupee has seen a sharp decline of more than 20% since May this year and is currently hovering around Rs.66 per dollar; this has raised costs of imported spare parts of most of the automakers in the country. Auto companies such as Mercedes-Benz, Audi and BMW, which use more imported parts than others, have increased prices in the recent months on the back of rising import cost.
Sri KG Krishnamoorthy Rao, MD & CEO, Future Generali India, said, “If the costs of spares go up, this will definitely increase the claim settlements for us. Also, if you see on a six month average, the labour cost has gone up by 10-15 % for manufacturers. So, a 15-20 % hike in the insurance premium is expected.”
Sri
K Sanath Kumar, General Manager and Whole-time Director of country’s largest
general insurance company, New India Assurance, has also echoed similar views,
but said the increase may happen in the high-end luxury cars segments only.
Source: http://www.insuringindia.com
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