The All India Motor Transport Congress (AIMTC) has resented the 10 per cent hike in levy on public carriers announced by the Insurance Regulatory and Development Authority (IRDA).
AIMTC has been consistently opposing any hike in the third party payment (TPP) as the data and formula on which these estimates for the levy are based is neither comprehensible nor reliable. None of the stakeholders are taken into consideration while proposing or deciding on the quantum of increase in levy.
For the claims arising out of road accidents, the sole responsibility is put on the transport sector. However, the Government, insurance companies, NHAI and road builders must share the responsibility of loss accruing from road accidents as, apart from the driver, the other factors like faulty road engineering, absence of signages, bad road conditions, poor lighting, lack of road amenities, etc., contribute significantly to road accidents and the resultant claims.
Mr. K.K. Srinivasan, a former IRDA member, has clarified that the proposed increase in motor TP premium looks unfair. In case of private cars of up to 1,000 cc, the increase is 137 per cent and for motorcycles of 100-150 cc the jump is 50 per cent. But there is an irony. The Indian Information Bureau (IIB), on whose data the increase is based, admits in its disclaimer that it has not validated the data and has uploaded the data as validated by the insurance company concerned. It also frankly admits that there could be errors and omissions while making the estimates.
AIMTC has made several representations to IRDA regarding relevant logical positive inputs for the claim settlement like capping of the claim amount, process of the claim settlement, correction of legislation, time-limit for lodging and settlement of claims and, in turn, saving on interest thereof. However, IRDA has not bothered to address any of these issues.
According to AIMTC, the current 10 per cent TPP hike by IRDA will not only accentuate the inflationary trend but also affect the fortunes of transport operators.