ICICI Lombard joins pay-as-you-drive policy segment

ICICI Bank: ICICI Bank posts 50% growth in profit at Rs 6,905 crore for June quarter, provisions decline sharply. The country's second-largest private sector lender clocked a 50 percent year-on-year growth in standalone profit at Rs 6,905 crore for the quarter ended June 2022, as bad loan provisions declined sharply YoY. Net interest income increased by 20.8 percent to Rs 13,210 crore, compared to Rs 10,936 crore reported in corresponding period previous fiscal, with 21 percent growth in advances and 13 percent increase in deposits YoY. Asset quality showed improvement on sequential basis.

Private sector non-life player ICICI Lombard General Insurance on Wednesday joined the growing trend in the motor segment, offering what the industry calls the 'pay-as-you-drive’ policy.

In a pay-as-you-drive motor policy, the premium is based on the average distance that a policyholder drives the vehicle.

Already insurers like HDFC Ergo, Bajaj Allianz General, Digit Insurance and a few others offer this type of motor cover.

ICICI Lombard has dubbed its new offer as the motor floater policy, which provides all the covers of a traditional motor policy (like accident cover, third-party liability and personal accident cover for the owner-driver), and now offers the advantage of adding all the vehicles owned by the proposer in one policy, said Sanjeev Mantri, an executive director at the insurer.

It is now offering this new pay-as-you-drive policy along with an option to convert the basic motor cover into an 'asset cum usage’ based product, wherein the premium of the basic motor vehicle will depend partially on the usage.

It offers two options under the policy, he said.

The first is the 'pay-as-you-use’ plan offers the flexibility to choose from different kilometre plans, depending on usage and thus the premium will be limited only to the extent the vehicle is used or estimated to be used by the customer. The second option is the 'pay-how-you-use’ plan under which the premium changes as per the driving behaviour scores, which means that a customer with good driving behaviour can avail of attractive discounts over the base premium of the policy, he said.

Customers opting for the motor floater policy will be provided with a lower premium for their multiple vehicles insured under the offering thus helping save customers’ efforts towards maintaining multiple policies for each vehicle owned by them.

Also, the full benefits of the no-claim at each vehicle level will be preserved under the motor floater offering when one shifts from independent policies to the floater policy.

In case of no claims during the policy period, a no-claim bonus of up to 50 per cent is offered to policyholders on renewals, he said.