Motor Vehicles Act: DFS asks pvt insurance companies for compliance drive

The Department of Financial Services on Tuesday asked private sector general insurance companies to coordinate with state governments and the Ministry of Road Transport and Highways to initiate a special drive to ensure compliance with the Motor Vehicles Act.

In a meeting with the General Insurance Council and the chief executives of private sector general insurance companies chaired by DFS secretary Vivek Joshi, "several critical issues having implications for the general insurance sector" were discussed.

Joshi also asked the private insurers to collaborate with the Ministry of Health to increase cashless facilities and standardisation of treatment costs to boost the growth of health insurance.

"After fruitful deliberations and focused exchange of opinions on these matters, Joshi directed DFS officials to take them up actively for resolution. It was also decided that regular meetings will be held with the industry—both private and public sector—so that the growth and development of the insurance sector is facilitated with continuous collaborative efforts," the finance ministry said in a statement. 

Issues regarding awareness building through continuous interaction with states under State Insurance Plans to increase insurance penetration and coverage, and distribution channel rationalisation in the opening up of the agency channel for the general insurance industry to increase insurance penetration were also discussed in the meeting.

The insurance companies were also asked to encourage adoption of property/parametric covers to mitigate financial losses due to natural catastrophes. Issues regarding devising mechanisms to cover the Micro, Small and Medium Enterprise sector and exploring the linking of insurance frauds to the CIBIL score to prevent or mitigate frauds were also taken up.