New Motor Insurance Scheme Lets You Pay Premiums only When You Drive. How it Works


Amid coronavirus outbreak, several insurance companies are introducing ‘pay as you drive’ policies for the customers. This unique motor insurance scheme allows the users to pay the premium only on the days they use the vehicle. Recently, Edelweiss General Insurance announced an app-based auto insurance policy – Edelweiss SWITCH. Launched under IRDA’s sandbox initiative, this insurance scheme permits vehicle owners to switch ‘on’ and ‘off’ the policy whenever they want.

The insurance is calculated on the age and experience of the driver, the company said in a statement. Customers can use the mobile application to switch their policy cover ‘on’ and ‘off’, depending on whether they are driving that day.

However, “the vehicles will be covered the whole year against fire and theft, even if the policy is switched off at that time, since these incidents can happen even if the vehicle is not being driven,” Edelweiss General Insurance said. The policy will only cover accidental damage when the insurance is switched ‘on’.

“This driver based insurance will mean lower premiums for policyholders, as they will only pay as per usage,” said Shanai Ghosh, ED & CEO, Edelweiss General Insurance.

Apart from the low premiums, the SWITCH insurance schemes cover multiple vehicles under one policy. “Edelweiss SWITCH has been developed with the specific needs of today’s customer in mind, where you may not use your vehicle regularly or may choose to alternate between your car and two-wheeler,” says Shanai Ghosh, ED & CEO, Edelweiss General Insurance.

“The ‘pay as you use’ model is expected to change the erstwhile industry standard of determining premium for Motor OD (by age, make and model of the vehicle), to premiums based on usage and driving experience,” Ghosh mentioned.


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