BOCI writes to IRDAI for extension of vehicle insurance validity

BOCI operators run 17 lakh buses and account for 30 crore passenger trips. Its members also operate 1.1 million cars which are used for intercity trav
...
In the current scenario, operators will not be able to pay premiums, leading to large number of defaults. (Representational photo)
In the current scenario, operators will not be able to pay premiums, leading to large number of defaults. (Representational photo)

Private passenger transport operators' body Bus & Car Operators Confederation of India (BOCI) has written to insurance regulator IRDAI, requesting extension of vehicle insurance validity.

BOCI operators run 17 lakh buses and account for 30 crore passenger trips. Its members also operate 1.1 million cars which are used for intercity travel.

"We urge Insurance Regulatory and Development Authority of India (IRDAI) and the government to extend vehicle insurance validity equal to number of lockdown days from the date of expiry without additional premium and no increase in annual premium for next one year," BOCI President Prasanna Patwardhan was quoted as saying in a release.

Also check these Vehicles

Find more Cars
Mahindra Ekuv100 (HT Auto photo)
UPCOMING
BatteryCapacity Icon40 kWh Range Icon150 Km
₹ 8.25 - 10 Lakhs
Alert Me When Launched
Porsche 911 Gt3 (HT Auto photo)
Engine Icon3996.0 cc FuelType IconPetrol
₹ 2.50 Cr
Compare
View Offers
Mahindra S204 (HT Auto photo)
UPCOMING
₹ 12 Lakhs
Alert Me When Launched
Lexus Nx (HT Auto photo)
Engine Icon2494.0 cc FuelType IconMultiple
₹ 64.90 - 71.60 Lakhs
Compare
View Offers
Rolls-royce New Ghost (HT Auto photo)
UPCOMING
Engine Icon6750 cc FuelType IconPetrol
₹ 6.95 - 7.95 Cr
Alert Me When Launched
Mercedes-benz Amg E53 Cabriolet (HT Auto photo)
Engine Icon2999.0 cc FuelType IconPetrol
₹ 1.30 Cr
Compare

He said operators are under pressure from multiple sides -- fuel price hikes, reduced capacity due to social distancing norms, loan EMIs, taxes and insurance premiums, among others.

"The ongoing financial burden with no revenue in the past quarter has pushed us on the brink of collapse," Patwardhan said.

In the current scenario, operators will not be able to pay premiums, leading to large number of defaults, as they have not been able to operate since lockdown began, he said.

Owners pay about 1 lakh per year towards insurance premium for a bus, and for premium buses it might go up to 2 lakh, he added.

Also Read : Covid-19 led to 20 lakh job losses in bus, taxi sector: Passenger transport body

The vehicles have been grounded since lockdown, therefore third-party damage is ruled out. Since a major part of the premium amount is paid towards third-party damage, the insurance companies should increase validity equal to the number of lockdown days, BOCI said.

"The validity extension sought will bring much-needed relief to an already stressed sector," Patwardhan said.

Recently, the government had announced extension of validity date of motor vehicle documents up to September 30, 2020. These include documents such as validity of fitness, permit (all types), driving license, registration or any other concerned documents.

It was the second validity extension by the government due to lockdown.

"However, the government has not addressed the vehicle insurance validity for comprehensive and third-party policy covers," BOCI said.

First Published Date: 07 Jul 2020, 09:23 AM IST
NEXT ARTICLE BEGINS

Check Latest Offers

Please provide your details to get Personalized Offers

Choose city
+91 | Choose city
Choose city
Select a dealer

Want to get the best price for your existing car?

Powered by: Spinny Logo
By clicking "View Offers" you Agree to our Terms and Privacy Policy
Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.