The Indian Motor Third Party Declined Risk Insurance Pool operates in the auto arena for the commercial vehicles to have (i) equitable and fair sharing by all insurers (ii) Simplicity to administer and (iii) To bring claims management efficiency. The policy of Declined Risk Insurance Pool applies to all commercial vehicles for standalone third party insurance (Act only insurance). The new plan provides an option to insurance companies to choose the liability they would bear totally meaning they would pay up 100% of the claims. When they see high claims, such as on trucks, they can dip into the pool, where every insurer contributes depending on its market share. The latest move by IRDAI will enable insurers to decide on whether they want to write the third party liabilities in a policy involving a Maruti Car, a Mercedes Benz, or a Tata Truck. They could choose to pay up claims in cities where accidents may be less frequent, while transferring to pool those coming from hinterland where there are more accidents. This, in insurance parlance, is called “Declined Risk Pool.” IRDAI fixes tariffs for third party motor insurance premiums to ensure that there is no supply side constraints, that is, vehicles considered high risk are not denied cover.