Madras High Court Makes Bumper to Bumper Insurance mandatory in India W.E.F September 1
An Overview of report
The motor accident tribunal (MCAT) in 2019 had directed the insurance company to pay Rs 14.65 lakh as compensation to the family of the deceased.
The order came after a writ petition was filed by New India Assurance Company Limited stating that the car owner had only covered third party insurance.
Justice S Vaidyanathan of Madras High Court made it Mandatory for all vehicles being purchased from 1 September to have Bumper to Bumper Insurance for a term of 5 Years.
This came after a hearing where a writ petition was filed by New India Assurance Company over Motor Accident Claims Tribunal (MACT) for a claim amount of Rs.14,65,800 as a compensation to relatives of the deceased, for his death in an accident
The court had quashed the tribunal orders due to current claimants as the car was only covered with third party insurance.
The court said ""It is saddening to point out that when a vehicle is sold, the purchaser / buyer is not clearly informed about the terms of policy and its importance""
Adding further more the court said ""Similarly, at the time of buying the vehicle, the buyer is also not interested in thoroughly understanding the terms and conditions of the policy""
The court registered its shock that When a buyer is ready to pay a huge amount for purchase of a vehicle, it is really shocking that the buyer is not interested in spending a paltry sum amount in order to insure safety of all the passengers in the vehicles.
After the Initial 5 years of taking the insurance the owner must be cautious in safeguarding the interest of driver, passengers, third parties and themselves, said the Court.
Siting the case, the court have also directed Additional Chief Secretary, Transport Department, Chennai to circulate the order to all insurance companies so that the aforementioned directions are
Cars and Bikes will be seeing a price hike as bumper to bumper insurance in made mandatory. Major effect will be seen in Hatchback sector with a increase upto 8% in car prices, while sedan and utility sector may not have a huge effect.
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