Motor Vehicle Bill Amendment 2016 - Here’s What You Need to Know

India has the highest frequency of traffic collisions in the world. According to a National Crime Records Bureau (NCRB) report, more than 135,000 traffic collision-related deaths occur in India, every year. Despite strict laws on traffic, road safety and speed limits, the occurrence of accidents and casualties has not been controlled.

According to statistics, every year around 5 lakh road accidents are reported in India, which results in 1.5 lakh casualties. In the wake of such a dismal situation in the country, there has been an urgent need for a while to uplift the road safety standards in the country.

To address these road safety issues, the Union Cabinet of India has approved the Motor Vehicle (Amendment) Bill 2016. The amendments in the law deal with issues related to drunk driving, driving under the influence of alcohol, vehicle insurance, accidental compensation, etc.

What is the Motor Vehicle Bill Amendment 2016?

The Ministry of Road Transport and Highways set up a group of 18 Transport Ministers of the States to propose changes to the existing Motor Vehicle Act. The new amendment brings in changes on 68 of 223 sections of the Motor Vehicle Bill to improve safety for commuters, with a severe increase in penalties for violation. With the enforcement of the amendments to the existing laws, the Government aims to reduce the accidents and mortalities by 50% in the coming five years.

How does the Motor Vehicle Bill Amendment 2016 affect you?

  • For medium passenger vehicles, the fine for over-speeding will increase from INR 400 to INR 2,000.
  • In the case of drunk driving, the fine will increase from INR 2,000 to INR 10,000.
  • For riding without wearing a helmet, the fine will go up from INR 100 to INR 1,000 and the driving license will be confiscated for three months.
  • For driving without a license, the fine will shoot up to INR 5,000, from INR 500 now.
  • In case of driving without valid vehicle insurance, you can be fined INR2000, which was earlier INR 1000.
  • Fine for talking on a mobile phone while driving has been increased from INR 1,000 to INR 5,000.
  • The compensation payable to the accidental victims has also been increased. For hit-and-run accidental cases, the compensation will increase from INR 25,000 to INR 2 lakh. However, in case of death from a road accident, the Bill puts a cap on the maximum claim at INR 10 lakh (INR 5 lakh for grievous hurt) from insurance companies.
  • For processing insurance claims, the bill has proposed specific timelines as well. Insurance companies will have to pay INR 5 lakh within one month of the accident, to the family of accident victims.
  • For the cases of road deaths due to engineering faults or potholes, the contractor will have to pay a penalty of INR 1lakh.
  • If an auto company is found manufacturing faulty vehicles or misrepresenting emission norms, it will have to pay a fine up to INR 100 crore. In such a case, customers will be offered the option to either get their money back or opt for car replacement.

The Bottom Line

The Motor Vehicle Bill Amendment 2016 is a strong and welcome step as it helps assure commuters’ safety through stricter road traffic laws; violation of which can lead to hefty fines and even imprisonment. The bill also puts emphasis on two-wheeler insurance as driving without two-wheeler insurance can attract double the fine as compared to earlier.

We believe that this amendment will open up the two-wheeler insurance policy market, and encourage people from hereon to ensure having two-wheeler insurance. In addition to this, no differentiation would now be made between private and public vehicles. What’s important now is that we as citizens play our part in putting this amendment to practice, and make our roads a better place to drive for ourselves and for others.

**To understand exactly about the policy coverage, exclusions etc read the Policy Wordings carefully.**

Here are the importance of motor vehicle insurance you must know.

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