Indian general insurers may push for a mandatory anti theft device in motor vehicles as early experience shows that claims fall nearly 80% in those cars that are fitted with it.
Anti-theft System..!
While many high end models have this in-built facility, the introduction of anti-theft system by the nation’s largest car maker Maruti Suzuki in many of its models has made a significant impact, say insurers.
Claims for Bajaj Allianz General fell by as much as 78% to just about 440 cases in 2012, from 2,600 cases a
year ago.
Mr. Vijay Kumar, Head (Motor Insurance) Bajaj Allianz General Insurance said, “It is desirable that all manufacturers follow this. “This device should be made mandatory in 2 wheelers and commercial vehicles also”
Mandating the anti-theft system in all vehicles, including 2 wheelers, could help reduce the cost of honouring insurance claims which at present is denting profits of general insurers.
This move along with limiting the claims on 3rd party motor insurance will go a long way in helping them remain profitable and get higher valuation when they sell their shares to public.
Electronic Control Module..!
The device is inbuilt into the car key and carries a secret code that communicates with the engine software through the electronic control module or the controller. But when the key is lost, even the anti-theft system cannot save a car from being stolen.
While the installation costs. Rs.3,000, one saves on the discount provided by insurance companies on using this device which could be as much as 3 per cent of the total cost of annual insurance premium.
Devices in-built ..!
Most luxury cars have such devices in-built in them. But small & compact cars had been missing out on it.
Other manufacturers such as Toyota Motors, Honda Siel Cars & Ford Motors had this in built device.
Similarly, Mahindra & Mahindra has introduced this device in highend models.
Mr.Sanjay Datta, Head (underwriting and claims) ICICI Lombard said, “We should have this device and wherever possible make it compulsory”
Discount on Insurance Premium..!
Companies are offering 2.5 per cent discount on premium to promote this device and reduce losses.
More & more people are opting for this device, though specific data is not available, insurers say.
Mr. Karan Chopra, Head ( Retail business) HDFC Ergo said, “Immobiliser has a positive impact on motor insurance premium. But pricing depends on different factors like make model, cost of spare parts and geography”
Src: Timesgroup
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