INTRODUCTION
Indian Motor Third Party Insurance Pool (IMTPIP) has been set up by all General Insurers in India to collectively service Commercial Vehicle Third Party Insurance business.
Insurance Regulatory and Development Authority (IRDA), after consultation with the Committee constituted under Section 110G of the Insurance Act, has directed that all general insurers registered to carry on general insurance business or general reinsurance business shall collectively, mandatorily and automatically participate in a Pooling Arrangement to share in all Motor Third Party Insurance business underwritten in respect of Commercial Vehicles by any of the registered general insurers.
As per IRDA directive, Motor Pool is in operation from 1st April 2007. The objective of the pool is to make available Third Party Insurance to all Commercial Vehicle owners at reasonable rates and terms.
It is an agreement among General Insurance Corporation of India (GIC) and Insurers registered to carry on General Insurance business (including motor insurance business) or general reinsurance business, under the Insurance Act, 1938.Every insurer who is registered for carrying on general insurance business under the Insurance Act, including GIC of India is the member of the Pool. Specialist insurers like ECGC, Agriculture Insurance Company of India Ltd., and stand-alone health insurers are exempted.
Starting off with a corpus of around Rs 2,800 crore, Indian Motor Pool includes only premiums from commercial vehicles. Third-party premiums charged on cars and two-wheelers are not included in the pool and these are handled by the general insurance companies themselves.
Third-party insurance is the cover related to injury or death to others while driving. All third party risks are transferred to the India Motor Insurance Pool, in line with the insurance regulator’s directive, virtually leveling the field between public and private sector players.
All the registered insurance companies are collectively participating in a pooling arrangement to share in all motor third party insurance business underwritten by them. According to the arrangement, all private sector insurers have to contribute to the pool consistent with their market shares. The private sector currently has a market share of 40 per cent in the general insurance business.
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By: Jagendra Kumar,
Corporate Head, (Trg),
Shriram Group Companies, Jaipur
Article published in Bimaquest, Pune
