General insurance shares up after Supreme Court's Motor TP directions

Shares of general insurers advanced after the Supreme Court directed the insurance regulator to consider longer Motor Third Party insurance tenures and measures to improve insurance coverage.

Shares of general insurance companies — New India Assurance, ICICI Lombard General Insurance and Go Digit General Insurance — ended higher after the Supreme Court directed the insurance regulator to increase the Motor Third Party (Motor TP) insurance tenure to four years for four-wheelers from the existing three years and to six years for two-wheelers from the existing five years. The court also proposed a pilot project to deny fuel to uninsured vehicles at petrol pumps, a move expected to aid insurance penetration and premium growth.

 

Shares of New India Assurance ended 7.1 per cent higher at ₹184 on the BSE. Similarly, ICICI Lombard General Insurance shares closed 1.7 per cent higher at ₹1,673, while Go Digit General Insurance shares rose 6.4 per cent to ₹280.1.

 

 

"The Supreme Court's direction to extend the mandatory third-party (TP) insurance tenure for new private cars to four years and new two-wheelers to six years, along with the proposal to link fuel supply to valid insurance cover, is expected to improve insurance penetration and compliance in the motor insurance segment," said Neha Parikh, vice-president and sector head, Financial Sector Ratings, ICRA.

 

She added, "Since Motor TP pricing is regulated, premium growth is largely driven by new vehicle sales and the extent of insurance coverage among existing vehicles. Therefore, higher compliance and improved penetration should be positive for the sector in terms of growth in premium."

 

According to General Insurance Council data, Motor TP accounted for 12.59 per cent of New India Assurance's total gross direct premium income (GDPI), at ₹1,598.94 crore, at the end of June 2026. It accounted for 38.8 per cent of Go Digit General Insurance's gross written premium, at ₹949.73 crore.

 

ICICI Lombard's Motor TP accounted for 16.64 per cent of its total gross premium, at ₹1,383.83 crore.