Faster claim settlements

The new motor vehicle bill passed by the Lok Sabha will expedite claim settlement process of the motor third party claims and limit the losses of insurers. The move to change will be an emendment after a long gap, with the last such change being affected in 2001. At present there is no defined timeline for claim settlement in case of accidents. With the passage of the bill, there is a clear six month time frame out to settle the third party claim settlements. Effectively, complainants will have to approach insurers within 6 months from the date of accident. In cases where the complainant accepts the insurer’s offer, the company has to settle it within another 30 days. The bill has also put a limit on the losses with the new bill putting a cap of Rs 10 lakh on death claim and Rs 5 lakh in case of serious injuries, which are all signs of the bill fixing any loopholes in the existing structure of the motor insurance policy.

olmdesk@outlookindia.com