5-year bumper-to-bumper insurance must for new vehicles in TN: Madras HC

Our Bureau Chennai | Updated on August 27, 2021

Order will come into effect for vehicles sold in the State from Sept 1

The Madras High Court has directed the Tamil Nadu Transport Secretary to ensure that new motor vehicles sold in the State from September 1 get bumper-to-bumper insurance cover, along with coverage for driver, owner, passengers and third parties, for five years.

Justice S Vaidyanathan, in an order on Wednesday, said it is mandatory for any new vehicle sold after September 1 to have bumper-to-bumper insurance every year, in addition to covering the driver, passengers and owner of the vehicle, for five years.

Thereafter, the owner of the vehicle must safeguard the interest of driver, passengers, third parties and himself or herself to avoid unnecessary liability, as there is no provision to extend the bumper-to-bumper policy beyond five years.

The order comes on an appeal filed by New India Assurance challenging a December 7, 2019, award by the Motor Accident Claims Tribunal, Special District Judge, Erode, directing the appellant/insurance company to pay the claimants ₹14.65 lakh as compensation for the death of Sadayappan alias Dhanapal due to an accident on August 3, 2016. The tribunal awarded the compensation on the grounds that the entire policy conditions had not been produced by the insurance company.

Justice Vaidyanathan said that it is saddening that when a vehicle is sold, the buyer is not clearly informed about the terms of policy and its importance. Similarly, the buyer, too, is not interested in understanding the terms and conditions of the policy, focusing more on the vehicle’s performance. When a buyer is ready to pay a huge amount for the vehicle, it is shocking they are not interested in spending a paltry sum for a policy to safeguard himself or herself and others, the order observed.

The order shall be circulated by the Transport Secretary to all insurance companies and the ‘said Officer’ must ensure it is followed scrupulously.

The matter has been listed for reporting compliance on September 30, the order said.

Published on August 26, 2021

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