I have question related to third party insurance for new Motor Vehicle act passed in 2019. In the previous law if unfortunately accident happens and there is a third party claim then the entire claim is beared by insurance company. I WANT TO KNOW WHAT WILL HAPPEN IN NEW ACT UNDER THE ABOVE MENTIONED CIRCUMSTANCES? There are unconfirmed reports that insurance companies will bear claim up to 10 lacs only and if claims tribunal decide higher claim then owner of the vehicle has to bear that. Also, there are rumours that motor vehicle owner has to pay some part of initial claim. PLEASE SHEAD LIGHT ON THIS ISSUE.
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Effort of amendment is to reduce road accidents and curb on dangerous driving, no such bar, only insurance company is liable to pay full compensation. The cap is for driver`s attendant in 3rd party insurance i.e Insurance firms have to pay claims within a month, if the victim’s family agree to accept Rs 5 lakh compensation.
Through court, unlimited liability.
The 2019 Bill passed by Parliament removes the cap on liability for third-party insurance. The 2016 Bill had capped the maximum liability at Rs 10 lakh in case of death and Rs 5 lakh in case of grievous injury.
No cap for loss or injury to third parties.
Rs. 7.5 lakh cap for property of third party mainly his/her vehicle.
The amendment says "The Bill removes the cap on liability for third-party insurance. The 2016 Bill had capped the maximum liability at Rs 10 lakh in case of death and Rs 5 lakh in case of grievous injury."
It's totally depends upon insurer that how much third party insurance s/he had insured with insurance company if it more than 25 lakhs than insurance company has to pay it otherwise the minimum claim can be granted.
Whereas third-party can claim any amount as insurance claim.
Because in amendments the CAP on liability is removed.
The Bill removes the cap on liability for third-party insurance. Bill had capped the maximum liability at Rs 10 lakh in case of death and Rs 5 lakh in case of grievous injury.
The new bill also says that there will be a ten-fold increase in the insurance compensation which is from Rs. 50,000 to Rs. 5 lakh. The insurance claims process will be simplified and cleared within a month. The minimum compensation for hit-and-run cases will be increased from current Rs. 25,000 to Rs. 2 lakh in case of death and to Rs. 50,000 from Rs. 12,500 in case of grievous injury.The Bill removes the cap on liability for third-party insurance. The 2016 Bill had capped the maximum liability at Rs 10 lakh in case of death and Rs 5 lakh in case of grievous injury.
Please note that the third party claim is limited to 750000 only and the entire claim cannot be beared by insurance company in case any amount is allowed by the court for over and above 750000 that will be Borne by the driver itself
There is no such amendment.
No there is no such speculation for new amendment under motor vehicle act.
These are just rumours.
What you heard is not yet enforced, hence you may wait for the new law to be enforced and then the outcome by different court by their verdicts, hence for now you just remain a silent spectator and watch the developments till their arrives a concrete decision on this.
This is pertaining to same issue. Please clarify on section 147(2) of new motor vehicle act passed this year. It says: "147(2) Notwithstanding anything contained under any other law for the time being in force, for the purposes of third party insurance related to either death of a person or grievous hurt to a person, the Central Government shall prescribe a base premium and the liability of an insurer in relation to such premium for an insurance policy under sub-section (1) in consultation with the Insurance Regulatory and Development Authority".
Central Government to prescribe base premium and liability of insurer in relation to such premium in consultation with IRDA.
The latest on it states that :
(2) Subject to the proviso to sub-section (1), a policy of insurance referred to in sub-section (1), shall cover any liability incurred in respect of any accident, up to the following limits, namely:—
Provided that any policy of insurance issued with any limited liability and in force, immediately before the commencement of this Act, shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier.
Therefore when you read the following before interpreting the meaning of the sub section 2, you will understand what is told in the latest law:
For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place.
I have very simple question: Previously the insurance company had unlimited liability for third party insurance. Will, under the new law the insurance company will has limited liability and rest of the liability has to be paid by motor vehicle owner? I am asking this again and again because my father is in logistics business and it is very big thing for us.
Unlimited liability.
Since the law has been newly introduced, and there is no case of any claim yet, hence the interpretation and repudiation by the insurance companies have not come to limelight, hence you may better wait for some cases to come to light after which ther will be discussions on that by courts of law at various places, by which you will come to know about the actual position and the law thereby..
It was having a cap in 2016 amendment for third party claimthe same has been removed in new MV Act. It's unlimited in body injury and death