‘Hyperlink automobile’s insurance coverage premium to challans’: Delhi LG VK Saxena writes to FM Nirmala Sitharaman | India Information

Delhi LG, VK Saxena has written to the Union Finance Minister, Nirmala Sitharaman, urging her to hyperlink insurance coverage premiums of automobiles to the variety of site visitors violations recorded towards the automobile

NEW DELHI: Delhi Lieutenant Governor (LG) VK Saxena has written to Union finance minister Nirmala Sitharaman, advocating for a system that hyperlinks automobile insurance coverage premiums to the variety of site visitors violations recorded towards every automobile. In his letter, Saxena underlined the vital significance of this proposal for enhancing highway security and selling accountable driving habits.
“I’m writing to your sort consideration to a matter of vital significance regarding highway security and vehicular insurance coverage in India,” Saxena wrote. “I wish to recommend to your consideration that insurance coverage premiums ought to be index-linked with the variety of site visitors violations recorded towards a automobile, which might have a salutary impression on highway security and site visitors self-discipline.”
The proposal comes within the wake of alarming statistics from the ministry of highway transport and highways (MoRTH), which reported over 437,000 highway accidents in 2022, leading to roughly 155,000 fatalities. Saxena famous that over-speeding accounted for almost 70% of those accidents, whereas violations like red-light leaping additionally considerably contributed to fatalities.

Evaluation from the World Financial institution revealed that automobiles with a number of site visitors violations have a 40% larger danger of being concerned in deadly crashes in comparison with these with a clear document. This development is echoed in Delhi’s personal site visitors statistics, with a 2023 report from the Delhi Site visitors Police indicating that 60% of deadly highway accidents concerned automobiles beforehand fined for site visitors violations, primarily over-speeding and red-light leaping.
Saxena additional defined, “There’s an apparent correlation between repeat site visitors offences and the chance of accidents. I might due to this fact recommend {that a} layered insurance coverage premium system based mostly on the frequency and severity of site visitors violations, as recorded in MoRTH’s VAHAN database, could also be launched.” He proposed that automobiles steadily cited for offences resembling 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 international locations the place comparable techniques are in place. “Such measures have been efficiently carried out in different international locations resembling the US, the place insurance coverage premiums enhance considerably based mostly on site visitors violations and rushing tickets, resulting in a median premium enhance 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 method. “Linking insurance coverage premiums to site visitors violations wouldn’t solely align insurance coverage prices with danger but additionally scale back the monetary burden on insurers as a consequence of claims arising from frequent accidents,” he added. “This market-driven resolution would encourage accountable driving, contribute to decreased highway accidents, save lives, and guarantee higher administration of insurance coverage claims.”