Madras High Court: S. Vaidyanathan, J., cancelled the bumper-to-bumper policy which was made mandatory by this Court’s order for new vehicles for a period of 5 years.
Upon hearing the submissions made on behalf of Insurance Regulatory and Development Authority (IRDAI), General Insurance Council (GIC) representing the licensed General Insurance Companies and SIAM, as a non-profit entity that has been espousing the cause of the Automobile Industry for several years, it appeared that the order dated 04-08-2021, mandating the coverage of bumper to bumper policy may not be logistically and economically feasible for effective implementation in the present legal dispensation.
Further, it was submitted that the directions issued by the Court have an unintended impact causing severe repercussions on the society and therefore the said directions may be withdrawn.
It was also brought to the notice of this Court that the issue of long-term third-party insurance coverage had been mandated by the Supreme Court and the Regulating Body, viz., Insurance Regulatory and Development Authority (IRDAI) had been periodically monitoring over the changing scenario and hence, there was no need for issuance of such compulsory directions.
Analysis, Law and Decision
Considering the submissions of the parties, High Court stated that directions issued by this Court in its 4-8-2021 order may not be conducive and suitable for implementation in the current situation, hence the said direction is withdrawn.
Lastly, the Bench concluded saying that, it hopes and trusts that law makers will look into this aspect and examine the need for a suitable amendment in the Act, relating to the wide coverage of vehicles so as to protect the innocent victims.
Further, in view of the withdrawal of the direction regarding bumper-to-bumper policy, the Circular dated 31-08-2021 issued by the Joint Transport Commissioner, Chennai also stands cancelled.
High Court directed Registry to remove Paragraph No.13 from the earlier order of this Court dated 04-08-2021 and issue a fresh copy of the order to the parties. [New India Assurance Co. Ltd. v. K. Parvathi, CMA No. 1565 of 2020, decided on 13-09-2021]
