Rahul, a 25-year-old engineer was running late for his office. He forgot to wear his helmet and was stopped at a traffic signal by a policeman. After pleading guilty and apologizing for his mistake, he had to pay a fine of Rs 100. Rahul was let off after paying a relatively small amount, but things may not be the same anymore. If he lands in a similar situation again, he may have to cough up a hefty amount of Rs 1000.
Both the houses of parliament have passed the Motor Vehicles (Amendment) Bill 2019 recently. It aims to improve road safety, weed out corruption in granting licences and reduce road fatalities. The bill seeks to comprehensively amend the Motor Vehicles Act 1988 to reflect contemporary needs. Drastic changes in penalties for traffic violations, motor vehicle insurance, getting a driving license and damages for accidents have been proposed. Almost everyone uses the road in some way or the other and is likely to get affected by the changes. Some proposals, however, will have a personal impact.
Increase in Motor Vehicle Insurance premiums
The government has made reducing road accident-related mortality a central aspect of the bill. The bill proposes to set up a cashless treatment facility for treatment of road accident victims in the golden hour, which is the first hour of the accident. The chances of preventing death are highest in the golden hour. The minimum compensation for hit-and-run cases will be hiked to Rs 2 lakhs from Rs 25,000 in case of death, and to Rs 50,000 from Rs 12,500 in case of a grievous injury.
Source: India Today
But the proposal related to accidents and compensations that will impact you personally is the removal of the cap on liability for insurers. The bill has included the driver’s attendant in third-party insurance and has removed the cap on liability for motor insurance companies. Additionally, the claim process is proposed to be simplified.
Motor vehicle insurance companies will have to pay the claim within a month if the victim’s family agree to accept Rs 5 Lakhs compensation. If the claimant is not satisfied with the compensation, a date of hearing will be fixed in the claims tribunal to adjudicate claims on merit. The removal of the liability cap will increase the risk for motor vehicle insurance companies, which will likely lead to an increase in premiums.
Increase in Penalties
Many people drive to their office for work. If you are not a stickler for traffic rules, you must have paid fines many times for violations such as driving without a seat belt or using mobile while driving. To curb traffic violations and improve road safety the bill proposes to hike penalties manifold. The fine for driving without seat belts will be increased to Rs 1000 from Rs 100. Similarly, for driving without a valid license, the penalty will be hiked to Rs 5000 from Rs 500. If you use your motorcycle for travelling and are caught riding without a helmet, it could set you back by Rs 1000 and your licence will be suspended for three months.
The proposed fine for driving without a motor vehicle insurance is Rs 2000, double of the current penalty. Having a motor vehicle insurance is compulsory by law. There are two major types of motor insurance, third-party and comprehensive insurance and having at least a third-party insurance is mandatory. At Finserv MARKETS, you can purchase Bajaj Allianz motor insurance online in five easy steps.
Hassle-free Process for Driving License
Besides increasing the penalties on driving without proper documents, the bill also focuses on streamlining the process of getting a driving license. The regional transport offices have become a hub of corruption which has led to people with sub-par skills getting a driving license. The bill seeks to reduce human intervention in issuing driving licenses through computerization of the process. With a computerized driving license test, the process is expected to be simpler, hassle-free and equal for all.
When the bill is notified into law, it is expected to transform the way goods and people travel in the country. The heavy penalties are likely to deter habitual traffic violators and inculcate a sense of road discipline. The bill focuses on providing adequate compensation to victims of road mishaps and motor vehicle insurance will play an important role in it. You can get Bajaj Allianz motor insurance through Finserv MARKETS from the comfort of your home.
Also know about the types of motor insurance policies
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