The court was told that his leadership would have an unintended impact, causing serious repercussions on the company; Judge S. Vaidyanathan said he hoped lawmakers would look into this issue
The Madras High Court withdrew an order it made last month directing the state government to ensure all new motor vehicles have bumper-to-bumper insurance coverage as well as coverage for the driver, owner, passengers and third parties for a period of five years.
Judge S. Vaidyanathan withdrew his order after the Insurance Development Regulatory Authority (IRDA), General Insurance Council (GIC) and the Company of Indian Automobile Manufacturers (SIAM) said that it might not be logistically and economically feasible for effective implementation in the current legal provision.
The court was told that his directive would have an unintended impact, causing serious repercussions on society and therefore should be withdrawn in the interest of policyholders, the auto industry and the general public.
It was brought to the attention of the court that the issue of long-term third party insurance coverage had been mandated by the Supreme Court as early as September 2018 and that IRDAI was periodically monitoring the development of the scenario and, therefore, there was no need to issue such instructions.
Counsel MB Raghavan, V. Arun Kumar and N. Vijayaraghavan representing IRDAI, GIC and SIAM respectively told the court that the concern expressed by the court regarding the protection coverage of uninsured innocent victims, such as Free occupants of a private car and passengers would be duly taken care of.
“Considering all the arguments (…) this tribunal considers that the directive issued by this tribunal may not be conducive and appropriate to implementation in the current situation. Therefore, said paragraph directive is hereby withdrawn at this time, ”the judge wrote.
He also said: “This tribunal hopes and hopes that lawmakers will look into this aspect and consider the need for an appropriate amendment to the Motor Vehicle Act regarding broad vehicle coverage in order to protect innocent victims. In view of the withdrawal of the instruction regarding the bumper-to-bumper policy, the circular of August 31, 2021 issued by the Joint Transport Commissioner of Chennai is also rescinded. ”