Government to amend MV Act for simplifying accident claims

The amendments have been circulated to all the central ministries for their views as these are proposed to be introduced in the monsoon sessions starting July 18.

Published: 08th July 2016 09:46 AM  |   Last Updated: 08th July 2016 09:46 AM   |  A+A-

NEW DELHI: In a move to simplify and reduce the time for road accident claims, the government is proposing an out of court compensation provision where upto Rs 10 lakh compensation will be provided in a short span of time in case of fatal accidents under third party insurance. In hit and run cases, the amount is fixed at upto Rs 2 lakh.   

Proposed under the amendments being brought to the Motor Vehicles Act (MVA), the Ministry of Road, Transport and highways (MoRTH) will work out a formula along with the Insurance Regulatory and Development Authority of India (IRDAI) on the amount to be given in cases of fatal accidents.

At present, it takes 8-10 years for getting an accident claim by exhausting all legal remedies. The amendments have been circulated to all the central ministries for their views as these are proposed to be introduced in the monsoon sessions starting July 18.  

In case of grievous injury suffered in the accident, where the vehicle has been identified, the compensation amount will be upto Rs 5 lakh. The provision to approach court will still be available to people in case they are not satisfied with the compensation amount.

There is also a provision to provide Rs 50,000 to Rs 1 lakh within 24 hours as interim relief to the family in case of fatal accidents. The cases dealing with the compensation in road accidents are dealt by special courts, the Motor Accident Claims Tribunal and civil courts cannot decide road accident compensation claims.

“The move is to simplify the existing complex insurance procedures under the MV Act and ensure immediate relief to accident victims and their kins as accident cases go in tribunal for years. The provision to approach accident tribunal is available to accident victim if the family decide to opt out of this provision,” said sources in the transport ministry.

With increase in hit and run cases especially on national highways, the ministry has proposed for Rs 200,000 compensation in case of death and Rs 50,000 in case of grievous injury. In hit and run cases, the accident victims are eligible for compensation through a special fund called ‘Solatium Fund’. The existing amount of compensation is Rs 25,000 in the event of death and Rs 12,500 for grievous injuries.

“Central government will make scheme specifying the manner in which this (compensation for hit and run cases) scheme shall be administered by the general Insurance Corporation,” the sources added.

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