Latest News
- Kerala Spearheads Revival of Iconic Double-Decker Trains in India
- Upcoming Force Gurkha 5-Door Latest Teaser Confirms Seating Layout & New Features – All Details Here
- Unprecedented Rainfall in Dubai Disrupts Daily Life and Raises Infrastructure Concerns
- 2024 Nissan Qashqai Facelift Gets Agressive & More Techy
- The Role Of Materials And Engineering In Helmet Safety
- India's Drag Racing Scene Calls For Permanent Strip: An Insight By NHRA's Mark Hughes
- Maruti Suzuki Swift Sales Dip: New Model To Be Launched In May
- Mahindra 3XO SUV Latest Teaser Reveals Connected Car Tech: All Details Here
- Aprilia Tuareg 660 Launched In India At Rs 18.85 Lakh – New Features & More
- ISRO Innovates with Lightweight Carbon Nozzle to Boost Rocket Efficiency
Amendment Proposed For Third Party Liability Cap On Vehicle Accidents
In order to cap the third party liability, one of the amendment proposed in the Motor Vehicles (MV) Act is to provide Rs 10 lakh in accident cases. As of now, the liability is unlimited and not capped at any particular amount.
The new proposal is being welcomed as "a friendly one for policyholders", the general insurance industry thinks it might not translate to lower premiums at least in the short term. The non-life insurance company have been indicating the unlimited liability provision and has been asking for aregular upward revision in third-party premiums.
Since there is a cap on the liability, it's natural to think of reduction of the premiums; however, that remains uncertain as of now.
R. Chandrasekaran, Secretary General, General Insurance Council, said that it is early to foresee a reduction in premiums. He said they have been seeing the maximum limit proposed in the Bill is much higher than the average claims for injuries and death being paid by the industry.
Also, there is any clarity on how the court would perceive it. He went on to say that the impact of capping the liability will be felt only after a couple years when the court will decide on the when the claims initiated on the policy post the amendment.
Chandrasekaran said, the rates will stabilise, narrow the band range and be affordable by all over a period time.
The claims are usually volatile and uncertain which will be minimised if not fully eliminated.
The amendment proposed also states that the third party liability premiums will be fixed by the central government.
Interestingly, ever since the insurance sector was opened up, the premiums for therange of risk covers have gone down except for the motor and health insurance policies.