News eDaily22 Nov 2017

India:Insurers find it hard to comply with Supreme Court order

22 Nov 2017

General insurers have said they are unable to implement a directive issued by the top court in India requiring them to verify that vehicle owners have a "Pollution under Control" (PUC) certificate before renewing their motor insurance policies.

Mr G Srinivsan, Chairman and Managing Director of New India Assurance and chairman of General Insurance Council, the official representative body of all domestic general insurers,said: “We don’t have the means to enforce it.”

A study by the Centre for Science and Environment (CSE) has revealed that only 23% of the vehicles in Delhi have undergone PUC tests, reported The Indian Express.

Citing practical difficulties, insurance companies are planning to take up the matter with the Supreme Court which had issued the directive on 10 August.

Though it had been expected that the IRDAI might issue some guidance to the general insurers on complying with the Supreme Court's order, the regulator had refrained from taking the step. Instead, the IRDAI adopts the stand that the matter is between the Supreme Court and insurers and there is no need for its intervention.

The Supreme Court order means more responsibility, paper work and additional manpower for insurance companies. It also means a rise in cost for insurers that will push up the premiums that vehicle owners pay every year. Moreover, policies are now increasingly bought by consumers online.

Though the Supreme Court order applies only to the Delhi-National Capital Region, insurance sources said there’s a possibility of it being extended to other parts of the country at a later stage.

The bench headed by Justice Madan B Lokur had also asked the Ministry of Road Transport and Highways to ensure that all fuel refilling centres in the National Capital Region have PUC centres.


 

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