Even as the last two years have seen the highest number of recalls by automakers in India, auto-component manufacturers have started seeking larger product liability and recall covers, say insurers.
Further, premiums on such covers too could go up due to limited re-insurance for such products.
“Indian markets saw five major auto recalls in 2015 and seven such recalls in 2014. This has impacted insurers’ premium books as there has been various recalls by automobile distributors and dealers causing a loss on account of recall expenses and replacements,” said KG Krishnamoorthy Rao, MD and CEO, Future Generali India Insurance.
The premiums in this segment, too, have seen a 50-70 per cent rise over that of the last financial year, he said.
