Chennai, Dec 14 (Inditop.com) Private non-life insurer Bharti Axa General Insurance Monday said it plans to offer an innovative car insurance policy under which customers will be paid the invoice value/cost of new car in case of total loss of vehicle in an accident.
“We have filed a product with IRDA (Insurance Regulatory and Development Authority) for approval where the compensation will be the invoice value of the car and not the depreciated value,” company’s Chief Executive Officer (CEO) Amarnath Ananthanarayanan told Inditop.
He said the innovative policy will give a further thrust to its retail motor insurance portfolio.
Under the new policy, zero-depreciation cover will be provided to the customer and if the car is damaged beyond repair or if the repair costs exceed the value of insurance (that is there is a total loss of vehicle in the accident), Bharti Axa will pay the invoice value.
The premium for such policy will be higher than the current policy rates.
The Rs.260 crore-equity Bharti Axa General is a 74:26 joint venture between telecom major Bharti and the French group Axa.
In order to boost its motor insurance business, Bharti Axa recently offered four add-on covers — hospital cash, reimbursement of medical expenses, ambulance charges and depreciation cover — on its car insurance policy.
According to Ananthanarayanan, the company will be adding around 20 new branches to its existing 80 and double the individual agency force by 1,000 to 2,000.
Speaking about commercial property insurance, he said the rates have to go up so that the portfolio can stand on its own.
“Reinsurers have reduced their commissions by 15 percent and the primary insurance rates have come down drastically,” Ananthanarayanan said.
Reinsurers pay the primary insurers commission for placing business with them and the rate would vary based on the business lines.
