NEW DELHI: Delhi Lieutenant Governor (LG) VK Saxena has written to Union finance minister Nirmala Sitharaman, advocating for a system that hyperlinks car insurance coverage premiums to the variety of visitors violations recorded towards every car. In his letter, Saxena underlined the important significance of this proposal for enhancing road safety and selling accountable driving conduct.
“I’m writing to your sort consideration to a matter of important significance regarding street security and vehicular insurance coverage in India,” Saxena wrote. “I want to recommend in your consideration that insurance coverage premiums ought to be index-linked with the variety of visitors violations recorded towards a car, which might have a salutary affect on street security and visitors self-discipline.”
The proposal comes within the wake of alarming statistics from the ministry of street transport and highways (MoRTH), which reported over 437,000 road accidents in 2022, leading to roughly 155,000 fatalities. Saxena famous that over-speeding accounted for practically 70% of those accidents, whereas violations like red-light leaping additionally considerably contributed to fatalities.
Evaluation from the World Financial institution revealed that autos with a number of visitors violations have a 40% larger threat of being concerned in deadly crashes in comparison with these with a clear file. This development is echoed in Delhi’s personal visitors statistics, with a 2023 report from the Delhi Site visitors Police indicating that 60% of deadly street accidents concerned autos beforehand fined for visitors violations, primarily over-speeding and red-light leaping.
Saxena additional defined, “There’s an apparent correlation between repeat visitors offences and the chance of accidents. I might subsequently recommend {that a} layered insurance coverage premium system primarily based on the frequency and severity of visitors violations, as recorded in MoRTH’s VAHAN database, could also be launched.” He proposed that autos steadily cited for offences corresponding to over-speeding and harmful driving ought to be subjected to larger insurance coverage premiums as a monetary deterrent to encourage safer driving habits.
He cited examples from different nations the place comparable methods are in place. “Such measures have been efficiently carried out in different nations corresponding to the US, the place insurance coverage premiums improve considerably primarily based on visitors violations and dashing tickets, resulting in a mean premium improve of 20 to 30%,” he stated. He additionally talked about that a number of European nations have adopted comparable practices.
In his letter, Saxena requested the finance minister’s intervention to provoke discussions with the Insurance coverage Regulatory and Improvement Authority of India (IRDAI) to create a framework for implementing this technique. “Linking insurance coverage premiums to visitors violations wouldn’t solely align insurance coverage prices with threat but additionally cut back the monetary burden on insurers because of claims arising from frequent accidents,” he added. “This market-driven resolution would encourage accountable driving, contribute to decreased street accidents, save lives, and guarantee higher administration of insurance coverage claims.”
