Insurance proposed for drivers' treatment cost

At present, third-party motor insurance is mandatory

The insurance sector might be required to offer a cover for medical expenses of both transport and non-transport drivers in case of a road mishap.

A group of ministers (GoM), constituted by the Union ministry of road transport & highways, has in a draft interim report recommended that provision be made in the motor vehicles Act to compel this insurance cover. At present, third-party (TP) motor insurance is mandatory, taken by owners of the vehicles. This covers against liability arising out of TP liabilities. However,it does not provide for accident insurance cover to transport drivers. In a mishap, drivers are at the mercy of their employers for meeting their medical expenses.

In the past two years, TP motor insurance refusal rates have seen a big drop, with the regulator cracking the whip on insurers refusing to provide cover. Insurers been barred from refusing to cover a TP motor risk and asked to sell motor TP products online.   The GoM draft report has also recommended that TP insurance must cover the accidental insurance for hired/paid drivers to the extent of Rs 50,000.

Sanjay Datta, chief, underwriting and claims, ICICI Lombard General Insurance, said there is paid driver insurance available but it is optional. “It is possible to put it as part of the TP cover,” he said. In one of the draft proposals for the Road Transport and Safety Bill, the maximum liability for compensation to a victim by the insurer, linked to the regulated minimum premium, shall be a sum of Rs 15 lakh. Hence, those seeking a large cover and willing to shell out a hefty premium might now get unlimited liability insurance from general insurance companies. Insurers said commercial vehicles like trucks, account for the largest share in value of claims paid and this has been rising at five to 10 per cent a year.

The GoM has recommended a group of officers under the road ministry, the department of financial services and insurance companies should study and recommend the insurance compensation amounts and also simplify the entire procedure for a claim.