Loading...
The Financial Express

Insurers demand first-party insurance is made mandatory for motor vehicles

| Updated: March 08, 2021 13:15:06


Insurers demand first-party insurance is made mandatory for motor vehicles

The country's insurers requested a move from the regulator to make the first-party motor vehicle comprehensive insurance mandatory.

They sought efforts by insurance regulator, insurers' association, road transport agency and the police to fix complexities that arose from the recent abolishment of third-party insurance for motor vehicles.

The insurers also demanded removal of an unclear provision in the Road Transport Act-2018 on insurance and clarification on the time period of insurance after registration of a motor vehicle.

In a letter to the Insurance Development and Regulatory Authority (IDRA) chairman, the Bangladesh Insurance Association (BIA) on Thursday also sought clear guidelines on the issue.

Contacted, BIA president Sheikh Kabir Hossain said no country has the opportunity to operate vehicles without insurance, not even public transport.

The IDRA, financial division and other authorities should take concerted effort to make motor vehicle insurance mandatory, he added.

Mr Hossain said section 60(2) of the Act mentioned motor vehicle insurance "as per rule", but owners of vehicles do not give importance to this issue.

The BIA and the IDRA issued circulars on the issue, but there is no sign of opening policy on motor vehicles.

"So, a new circular and a concerted effort must be in place to make the first-party insurance for motor vehicles mandatory," he told FE.

The Motor Vehicles Ordinance-1983 made the third-party insurance compulsory.

There was a provision of a fine of Tk 2,000 for not insuring any motor vehicle.

No such provision has been made in the new Road Transport Act-2018.

The first-party insurance is not mandatory now, be it in the previous ordinance or the new law.

Bangladesh Police stopped filing cases in the absence of third-party insurance of motor vehicles from November 01.

The new law calls for the creation of a fund to compensate third parties affected by motor vehicle accidents or any other cause instead of insurance.

[email protected]

Share if you like

-->