In vehicles, third-party risk insurance or third-party insurance was canceled last month by the Insurance Development and Regulatory Authority (IDRA). Cars are running on the road without insurance. People in the sector think that first-party insurance or comprehensive insurance policy should be made compulsory. This will benefit both the company and the owner.
There have been two insurance policies for so long for motor vehicles called first-party or comprehensive insurance and the third party or third party insurance. Under the first party policy, if a car is damaged in an accident on the road, the insurance company compensates the car owner. In the case of the condition, compensation is paid from the company even if the vehicle’s driver or passenger is physically injured.
And in the third party policy, the insurance companies would compensate the victim if one car damaged another car or injured or killed another person while walking on the road. Although comprehensive insurance was introduced, IDRA issued a notification in December canceling the third-party policy.
IDRA and other concerned officials in the insurance sector said that since the third-party risk insurance has been canceled, the comprehensive policy of motor vehicle owners may be made mandatory. Because at the moment, if someone is damaged on the road, not everyone is aware of how to pay the compensation.
According to IDRA sources, motor vehicle owners should be required to adopt a comprehensive policy. This will benefit both the owner and the road damage. Because even if it is done for legal reasons, it does not work in practice. This is because, for a third-party insurance policy, the motor vehicle owner had to pay a premium of Rs 400 to Rs 600 per annum, which is very low. Again, there was a provision to pay 20,000 rupees if someone died on the road and 10,000 rupees if injured, which is insignificant compared to the need.
The first-party or comprehensive premium of different car companies is about 60 thousand to one lakh 25 thousand. The maximum premium for first-party insurance is Tk 4,7,227, and for trucks, it is Tk 99,358.
IDRA chairman said. M Mosharraf Hossain told Kaler Kanth, “The premium paid to deal with third-party risk is very limited. Passenger insurance has been made optional in the Road Transport Act. As a result, the third-party risk insurance has been canceled as per the Prime Minister’s directive. However, comprehensive insurance will continue; there are plans to do more with it in the future.
Mozammel Haque Chowdhury, secretary-general of the Bangladesh Passengers Welfare Association, thinks third-party risk management needs to be covered by a comprehensive policy. He told Kaler Kantha, ‘The rule of insuring in the road law did not prevail properly. As a result, it is necessary to include it in the law to ensure compensation. This was the expectation of the people. I demand that the law be amended to include the issue of compensation in the comprehensive policy. “He added,” We have to talk to the owners and passengers to determine the premium.”
Mansur Alam Sikder, vice-president of Republic Insurance Company Limited, told Kaler Kanth that if the customer pays a small amount of premium at the end of the year, it is possible to get a good amount of compensation.
According to IDRA sources, third-party insurance has been compulsory for so long, but people were not aware of its benefits. Motor vehicle owners used to take out a third-party insurance policy to get relief from traffic police cases on the road.
Concerned people say that the road safety law does not mention anything about the risk of third parties. Again, even if it is under the insurance law, it will not be effective. As a result, if the comprehensive policy is made mandatory, the motor vehicle owner will pay a reasonable premium. Then an appropriate compensation can be obtained from the company as compensation.
An official who has been involved in the insurance sector for 20 years told Kaler Kanth on condition of anonymity, “In fact, the third party policy could not benefit the aggrieved person.” Because according to the Insurance Act of 1973, there was a provision to pay 10,000 rupees if someone was injured and 20,000 rupees killed, which is very low.
Again the customer would deposit a small amount of premium every year. As a result, I think a comprehensive insurance policy will come under a rule if it becomes a rule of obligation. Comprehensive premiums are relatively high. So I think it’s essential to make sure that it doesn’t become too much for the customer.’