Edelweiss General Insurance has launched the Switch ‘Pay As You Drive’ (PAYD) add-on for its private car package policy.
Earlier this month, Edelweiss had launched Switch 2.0, which the company claims, is the only kind of its product in India that combines the dual benefits of both the ‘pay as you drive’ as well the ‘pay how you drive’ benefits for the policyholders.
Features Of Switch Pay As You Drive Add-On
This new add-on cover will allow customers to get a discount on their Own Damage (OD) premium depending upon their annual usage in terms of distance covered.
“Until now, under a regular motor policy, there was no difference in the premium paid by a customer who hardly used the vehicle when compared to a high usage vehicle owner. We changed this with the introduction of Switch, two years ago. Now, with this add-on feature, this product can be added as a bolt-on to existing motor insurance products. The premium will be charged according to the kilometres travelled by the car. Drive less, Pay less with this add on!” Edelweiss announced in a press release.
This add-on provides customers with three slab options of OD cover – up to 5,000 km; 5,000-7,500 km; and 7,500-10,000 km annually.
Based on their annual usage pattern, customers can opt for the slab that best suits their usage.
According to Edelweiss, customers will be able to save up to 25 per cent on their premium with this add-on cover. In case the annual car usage goes above the slab opted for, then the customer can buy a top-up cover for additional usage.
Suitability Of The Product
Edelweiss has said that the product is ideal for customers who work in hybrid or work from home (WFH) environment, or, have company-provided transportation, or use public transport to commute for work. It is also suitable for the retired or those with multiple cars who use their secondary vehicles sparingly. Customers who have limited use of their cars can have significant saving on their annual premium, Edelweiss said.
Shanai Ghosh, executive director and CEO, Edelweiss General Insurance, said in a press statement: “We always believed that usage-based insurance has huge potential in India. We have been working on this concept since 2020 and have launched two products on the same concept under IRDAI’s sandbox. The regulator’s recent guideline on motor OD add-on bears testimony to our belief and we are extremely happy and proud to be the frontrunners in taking such innovative concepts to the customers. We have many more products in the works to strengthen this portfolio which will be launched soon.”
Switch 2.0
Previously Edelweiss was the first to introduce India’s only on-demand motor insurance, Switch, in 2020 under IRDAI’s Sandbox initiative. This was a usage-based product which allowed customers to switch on and off their insurance.
Later, the Insurance Regulatory and Development Authority of India (IRDAI) had also issued new guidelines permitting general insurance companies to introduce tech-enabled concepts for Own Damage (OD) in motor insurance policies. These include, among others concepts such as Pay as You Drive, and floater policy for vehicles belonging to the same individual owner for two wheelers and private cars.
Click here to read more about it: https://www.outlookindia.com/business/irdai-allows-insurers-to-introduce-tech-enabled-concepts-for-own-damage-in-motor-cover-news-207253
The IRDAI guideline came as a shot in the arm for the digital insurer as it has been one of the first in the country to launch usage-based insurance and has been developing this category for over two years, with telematics enabled, app-based products.
It launched Switch 2.0, again under the regulator’s sandbox initiative that measured not just how much one drove, but rather how well he/she drove. The better the driving behaviour, the lesser the premium and vice versa.
Click here to read more about it: https://www.outlookindia.com/business/drive-sober-pay-less-premium-on-your-car-with-intelligent-motor-policy-from-edelweiss-news-207184
IRDAI And Other Player Recent Initiatives
At present, ICICI Lombard has launched a slew of innovative solutions within motor insurance, aimed at further enriching the end-customer experience on the lines of Pay As You Use and Pay How You Use.
In addition, Kotak Mahindra General Insurance has also announced automating vehicle inspections with Artificial Intelligence (AI)-based technology for vehicle insurance renewals.
On its part, the IRDAI has permitted general insurance companies to introduce the following tech-enabled concepts for the OD cover to be provided as add-ons to the basic OD policy. These are:
- Pay as You Drive;
- Pay How You Drive; and
- Floater policy for vehicles belonging to the same individual owner for two-wheelers and private cars.
