You had better check the validity of your vehicle insurance. Soon, it will be not be possible to evade the mandatory motor third party insurance, thanks to Insurance Information Bureau of India (IIB) and other agencies.
``Our study showed that about 55 per cent of all registered vehicles in the country have no insurance! We are rolling out an automatic detection system in association with police and road transport authorise in difference states shortly,’’ R Raghavan, Chief Executive Officer, IIBI told Business Line here.
There are about 12.5 crore vehicles on roads in the country. While the all vehicle owners will automatically buy vehicle insurance, only 45 per of them renew their policies after a year, he said.
To begin with the bureau is in the process of rolling out electronic detection system in the National Capital Region, Gujarat, Maharashtra Madhya Pradesh, Andhra Pradesh, Telangana and Kerala in consultation with the respective state governments. This should be in place in about three months from now after which it will be expanded across the country.
``A pilot conducted with the active participation of Cyberabad police and regional transport officers here had given very good results. There are 3.05 lakh uninsured vehicles in just one part of Hyderabad alone,’’ he said. Out of this police had issued e-chalans to 1.89 lakh vehicles so far.
BENEFITS
Rolling out a similar system across the country will have many benefits. ``Most importantly, there is a social aspect because the accident victims on roads will have to be taken care. It will also reduce orphaned claims,’’ Raghavan said.
From business point of view this could mean much to the insurers. The motor third party insurance premium alone will go up by Rs 7,000 crore without adding the comprehensive insurance which is generally clubbed with mandatory third party insurance for any vehicle. ``This will definitely bring down existing vehicle insurance premiums significantly due to economies of scale,’’ he added.
Early this wee, the Insurance Regulatory and Development Authority of India (IRDAI) had proposed 15 to 108 per cent hike in the motor third party insurance premiums for the next financial year, 2015-16.
Efforts are also on to offer spot insurance for vehicles along with the police/transport department checks and the bureau had also conducted a series of meetings with all general insurers to take this forward and create better awareness.