Bumper to bumper insurance not mandatory: Madras High Court modifies previous order

The Madras High Court has modified its previous order dated August 4 that mandated bumper to bumper insurance for all new vehicles for a period of five years to ensure safety of passengers, drivers, and owners (The New India Assurance Co Ltd v. K Parvathi)..Justice S Vaidyanathan observed that the previous order may not be conducive and suitable for implementation in the current situation, and thus, the direction was withdrawn..However, the Court charged law makers with the responsibility of looking into this aspect and examining the need for an amendment to the Act.“This Court hope and trust that law makers will look into this aspect and examine the need for suitable amendment in the Act, relating to wide coverage of vehicles so as to protect the innocent victims.”.Advocate S Arunkumar, counsel for the General Insurance Council, moved the Court for clarification in the matter. It was submitted that the order mandating bumper to bumper coverage policy was not logistically and economically feasible and that the direction had an unintended impact causing severe repercussions to society.“Therefore, the directions issued by this Court may be withdrawn in the interest of Policyholders, Automobile Industry and public at large,” it was prayed..Further, it was submitted that there was no requirement for compulsory directions since the issue of long-term third-party insurance cover was mandated by the Supreme Court in September 2018 and the Insurance Regulatory and Development Authority of India (IRDAI) periodically monitored the scenario..Advocate MB Raghavan submitted that IRDAI will consider better and fuller insurance coverage to all victims, including drivers, owners, gratuitous occupants, or pillion riders..In light of these considerations, the Court directed the Registry to remove the paragraph in question from the earlier order and issue a fresh copy to the parties..The August 4 direction was passed while setting aside an award of the Motor Accident Claims Tribunal (MACT) that directed a sum of ₹14,65,800 be paid by an insurance company to the claimants who were relatives of the deceased, as compensation for his death in an accident.Keeping in mind the safety of a vehicle’s passengers, Justice Vaidyanathan made bumper to bumper coverage mandatory.It was also directed that the order be circulated to all insurance companies so as to ensure that the directions in the order are followed scrupulously in letter and spirit without any deviation.