Southern States - Tamil Nadu   

'Insurance firms taking vehicle owners for a ride'

By Our Staff Reporter

Coimbatore, Feb 26. The Coimbatore Consumer Cause (CCC) has appealed to the Union Finance Minister to regulate automobile insurance firms, which are indulging in "unfair trade practices".

Most of the companies refuse to provide the statutory third party insurance cover, K. Kathirmathiyon, secretary, said in a memorandum. Under the Motor Vehicles Act, no vehicle would be permitted to ply on the road without third party insurance.

But consumers were compelled to have comprehensive insurance, if they wanted to have third party cover. Moreover, the companies refused to provide comprehensive insurance for vehicles, which were more than ten years old. The companies were trying to phase out old vehicles, causing hardship to the middle class.

Further, No Claim Bonus (NCB) was not being given to consumers, if vehicle ownership had changed during the insured period. As insurance was for the vehicle and not for the owner, the NCB should be given even if ownership had changed and if no claim had been made for the vehicle during the previous year.

Extra collections

Mr. Kathirmathiyon charged that some of the branches were collecting extra "illegal" premium. In some cases, they collected extra premium, if the policy had lapsed and was renewed after some days.

Since the insurance companies were not going to settle any claim for the lapsed period, they did not have a right to charge premium for the lapsed period, he said.

The CCC also expressed concern at unabated collection of excess premium by the insurance companies in the name of "loading" for vehicles, for which there had been no claim or adverse claim experience in the past.

There were instances of the companies refunding the excess premium, at court intervention in Kerala and on notices from consumer organisations.

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