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BOCI bats for vehicle insurance validity extension

Photograph by Sushir Vasishta

Bus & Car Operators Confederation of India (BOCI), the apex body for public transport in India representing private passenger transport operators, has sought extension of vehicle insurance validity.

Operators attached to BOCI run 17 lakh buses in various segments and accounts for 30 crore passenger trips, amounting to more than 80% of public transport in the country.

Photgraph by Shankar Ravichandran

BOCI is seeking regulatory Insurance Regulatory and Development Authority of India (IRDA) and government intervention for extension of vehicle insurance validity. Public transport sector has been one of the worst hit with the lockdown due to COVID-19 pandemic.

BOCI has reached out to various state governments and has also the Ministry of Road Transport and Ministry of Finance to draw their attention on the plight of the public transport sector.

Increase Validity

Operators says the vehicles have been grounded since lockdown therefore third-party damage is ruled out. Since a major part of the premium amount is paid towards third-party damage, the insurance companies should increase validity equal to the number of lockdown days.

Photograph by Jino Sebastian

The Indian government has recently announced extension of validity date of motor vehicle documents up to September 30, 2020. These include documents such as validity of fitness, permit (all types), driving license, registration or any other concerned documents.

This is the second time the government has extended this validity due to lockdown. However, the government has not addressed the vehicle insurance validity for comprehensive and third-party policy covers.

Prasanna Patwardhan, President, Bus & Car Operators Confederation of India (BOCI) said, “The public transport operators are on the verge of bankruptcy in the current situation. We are under pressure from multiple sides, fuel price hikes, reduced capacity due to social distancing norms, loan EMIs, taxes and insurance premiums and much more.”

The ongoing financial burden without revenue in the past quarter has pushed the industry on the brink of collapse.  We urge the IRDA and the Government of India to extend vehicle insurance validity equal to the number of lockdown days without additional premium and no increase in annual premium for next one year.

Members of the BOCI operate nearly 1.5 million buses and 1.1 million cars, which are used for intercity travel, as school buses, and as tourist vehicles. Owners must pay about Rs 1 lakh a year towards insurance premium for a bus. This might be up to Rs 2 lakh for premium buses.

In India where the majority of the populace depends on public transport for their commute, survival of the sector is imperative. The operators shutting down operations may have a serious ripple effect on public life and livelihood of millions of families who depend on the sector for their survival.

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About Jaishankar Jayaramiah

Jaishankar Jayaramiah is a well-known India-based award-winning international Journalist and columnist, who is familiar for his multi-subject expertise, especially in business Journalism. Many of his write-ups remained as game changers in the Indian trade industry while also guiding the government to chalk out its policies. An Engineer-turned Journalist Jayaramiah has worked for Autocar Professional, The Financial Express, The New Indian Express and Automotive World among others before joining Automotive India News. He has extensively traveled across the country, writing on multiple subjects and also visited countries like Germany, Italy, Japan, China, Taiwan, Singapore, Thailand, Hongkong, Sri Lanka, Maldives etc. Don’t wonder if you find a story on coffee or agriculture or even on politics when you Google his details as he has written on almost all subjects during his 18-year journey so far in Journalism. While keeping automotive as main beat all along his career, he has also covered all other verticals under Old & New Economy. For the past few years, he has been focusing only on B2B Automotive niche. Personally he likes to write more on the government policies; international trends related to automotive industry and new auto technologies.

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