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Reference No.: IRDAI/NL/CIR/MOTP/ 200/12/2018
Date: 11/12/2018
Cover for Compulsory Personal Accident (CPA) for Owner-Driver under Motor I

The Authority had issuedthe following circulars with regard to the captioned matter:

1.   CircularRef: IRDAI/NL/CIR/MOTP/158/09/2018 dated 20th September, 2018.

2.   CircularRef: IRDA/NL/CIR/MOTP/170/10/2018 dated 9th October, 2018.


2.   Feedback has been received from various quarters wherein ithas been pointed out that many owner-drivers already have existing generalPersonal Accident covers which ought to be taken cognizance of. Also, the factthat owner-drivers may own more than one vehicle needs to be taken intoconsideration in a more rational manner so that the owner-driver does not haveto take different policies for the different vehicles that he/she owns.


3.    After a detailed examination of the issues, it has beendecided, in terms of Section 14(2) (i) of the IRDA Act 1999, to unbundle theCompulsory Personal Accident cover and permit the issuance of a stand-aloneCompulsory Personal Accident cover for Owner-Driver. However, if a policyholderchooses to opt for the CPA cover as part of the Liability Only policy or thePackage policy as it exists today, he/she can continue to do so. In the eventthe policyholder chooses to take a stand-alone CPA policy, the CPA cover offeredas part of Liability Only or Package policy shall be deleted.


4.    With regard to the stand-alone CPA cover, the following arebeing stipulated:


(i)    Effective1st January, 2019, stand-alone Compulsory Personal Accident coverfor Owner-Driver may be issued. Keeping in view the date of implementation, asan interim measure, insurers may price the product in accordance with theirgeneral pricing philosophy, based on actuarial principles for the risk inquestion. Should the Authority find the pricing approach in variance from theirgeneral pricing philosophy/approach and not in line with actuarial principles,suitable direction may be issued by the Authority.


(ii)  Theproduct shall be filed with the Authority in terms of the Product FilingGuidelines dated 18th February, 2016 on or before 15thJanuary, 2019 failing which the insurer shall not be allowed to sell theproduct as permitted in 4(i) above beyond that date.


(iii) 4(i) above may befollowed till such time the duly filed product is approved by the Authority. Onapproval, the product shall be sold on the lines it has been approved.


(iv) Accordingly, effective1st January, 2019, on expiry of a Bundled CPA cover, it may bereplaced with a stand-alone CPA cover and the same may be taken from any registeredinsurer transacting general insurance business.


(v)  Coverageunder the stand-alone CPA will extend to all the vehicles owned by theowner-driver under the same policy. In other words, the cover under thestand-alone CPA policy would be valid when the owner-driver drives any of thevehicles he/she owns.


(vi) The duration of thestand-alone CPA cover would be one year.


(vii)  Thecoverage under the stand-alone CPA would continue to be that stipulated underGR 36 A of the erstwhile India Motor Tariff, namely, Death and Permanent Disability(Total and Partial).


(viii) Since a generalPersonal Accident cover also includes cover against motor accidents, if anowner-driver already has a 24 hour Personal Accident cover against Death andPermanent Disability (Total and Partial) for CSI of at least Rs.15 lacs, thereis no need for a separate CPA cover to be taken.

Please acknowledge thiscircular and confirm having noted its contents.

This is issued with theapproval of the competent authority.




Chief General Manager (Non-life)


CC: The Secretary General, General Insurance Council,Mumbai

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