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Wednesday, September 1, 2021

implementation of mandatory bumper-to-bumper insurance



Understand that subsequent to the orders of the Hon’ble High Court of Madras in CMA 1565 of 2020 and CMP 11557 of 2020 dated 4.8.2021, the  Joint Transport Commissioner[R]  of Tamilnadu has issued a circular  to all Regional Transport Offices and all MV Inspectors  on the subject of mandatory coverage of ‘bumper-to-bumper’ insurance for a period of 5 years implementation.

The circular refers the Order of the High Court on new vehicles being sold after 1.9.2021, should have mandatory coverage of bumper to bumper insurance – and states that there should be b-to-b insurance every year in addition to covering the driver, passengers and owner of the vehicle for a period of  5 years.

The circular directs all REgistering authorities to follow the order without deviation – at the time of registering vehicles, the authorities have been directed to verify the availability of such insurance without deviation.

As discussed in my earlier insurance post – there appears some gap in understanding what in insurance parlance is “bumper-to-bumper” insurance. Perhaps the Hon’ble Judge wanted mandatory insurance coverage as envisaged in Motor vehicles Act + Personal accident coverage for owner-driver (as necessitated by an earlier judgment) + coverage for all passengers, driver and owner travelling in the vehicle.

Whether Own damage cover is the requirement is perhaps a bit unclear and the Insurance companies will now have to activate long-term policy for atleast 5 years – a package policy at that. .. .. and that going by the directive of the Hon’ble Court – it has to be ‘bumper-to-bumper’ insurance, which in someways in an add-on meaning ‘nil-depreciation’.

Understand that the Insurers would be represented in a common way through General Insurance Council.

With regards – S. Sampathkumar
1st Sept. 2021




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