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VEHICLE FINANCE

IRDAI proposes separate car-loan insurance

A consultation paper would stop compulsory insurance bundling with vehicle finance, but it is not yet a rule.

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WHAT CHANGES

Insurance could not be a loan condition

Banks and NBFCs would not be allowed to make policy purchase compulsory for a car loan.

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THE PAYMENT

Premiums would be shown separately

The proposal says the insurance premium should be paid directly instead of being folded into the loan amount.

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BUYER CHOICE

No forced lender-linked insurer

A permitted package would show loan terms with and without cover and would not force one insurer.

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WHAT NEXT

Feedback remains open

25 OCT 2026

IRDAI has invited comments before deciding the final wording and implementation.

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READ THE FULL STORY

Check every loan line item

See what the proposal could mean for vehicle finance, insurance costs and paperwork.

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Read: IRDAI proposes unbundling insurance from car loans for buyers