The government took this step to reduce the impact of insurance companies
IRDA increased third party insurance by 21 percent in 2019
Utility desk. Now the Ministry of Transport will decide the premium of Third Party Insurance, not the Insurance Regulatory and Development Authority (IRDA). A change has been made in the motor vehicle act. This will not only help protect the interests of consumers, but also reduce the impact of insurance companies, which pressurize third party insurance to increase premiums.
Complaints of increasing premium were getting consistent
There are frequent complaints from vehicle owners about increasing third party insurance. This has been one of the main reasons for the transporters’ strike. In June 2019 also, IRDA had increased the third party insurance by 21 percent. The Ministry of Transport will soon notify the rules and explain how it will fix the premium for each category of vehicle.
What is motor third party insurance?
Third party means third party. The first party is the vehicle owner, the second driver and in the event of an accident the third party is the victim. The owner and driver of the vehicle are legally obliged to compensate for the loss if there is an accident during the use of the motor vehicle in a public place and there is loss of life and property to a third party. In such a situation, third party insurance is done by insurance companies to compensate for the economic compensation. The amount of compensation is paid by the concerned insurance company when insured.
Why is motor third party insurance necessary?
This is legally required. As per the provisions of the Motor Vehicles Act, no vehicle owner can use his vehicle by himself or by any other person in a public place unless the vehicle has been third party insured.
Insurance is very important for third party
The amount of compensation in motor accident claims is determined by the Motor Accident Claims Tribunal. Compensation can also be determined through a Lok Adalat by mutual agreement. When an insurance company is responsible for paying compensation, the approach of the court concerned is lenient and the aggrieved party gets the appropriate amount. However, if the amount is to be paid by a person, then comparatively less compensation can be determined and the victim may suffer loss.
What will happen when there is no insurance?
This will not only cut the challan of your car, as well as if there is an accident with this vehicle, then the victim in front is entitled to legal compensation which has no upper limit, so it can be any amount. In such a situation, it is difficult to pay compensation if there is no auto insurance. In some cases the driver may also be jailed.