As per the judgment of the Madras high court, IRDAI, the regulatory body of insurance in India, has issued a circular making it mandatory for car insurance policies to have Rs 15 lakhs personal accident cover for owner/driver. Until now, PAC of only Rs 2 lakhs was mandatory and the increase in cover will lead to an increase in premium by about Rs 700 including taxation.
The judgment issued a couple of years ago has ruled that a cover of Rs 2 lakhs is grossly insufficient in today’s age, which is the reason why the compulsory PAC has to be increased to Rs 15 lakhs and should be offered to customers at a premium of Rs 750. Buyers can opt for higher amounts of PAC by paying an additional premium to the insurer.
This will increase the car insurance premium by up to Rs 700 including the GST as the previous cover of Rs 2 lakhs was being offered for Rs 100. The personal accident cover not only covers death, but also any permanent disability which includes loss of limbs, loss of eyesight or any other ailment that can be certified as a disability by authorised medical professionals. Also, additional cover for co-passengers is also available.