Financial Daily from THE HINDU group of publications
Friday, Aug 02, 2002
Money & Banking
Logistics - Roadways
Transporters seek IRDA action on tariff norms
Sarbajeet K. Sen
NEW DELHI, Aug 1
IT's time for fresh action on the motor insurance front with transporters once again seeking the intervention of the Insurance Regulatory and Development Authority (IRDA) to discipline insurance companies, which allegedly are openly flouting the regulator's directive on adopting uniform company-wide policy on fixing insurance premium.
In a sternly-worded directive issued two months ago, IRDA had asked all insurance companies to prepare internal guidelines on motor tariffs that would be made applicable by their operating offices.
The direction was issued to bring about discipline on the charging of premium which the authority felt was going out of hand with different offices of the same insurance companies taking varied premia. Moreover, the amount charged as renewal premium on renewal from transporters was also not in keeping with the accepted norms of premium hikes.
However, transporters have now written to the authority pointing out that the IRDA's directive has made no change in ground realities in the intervening two months.
"To the best of our knowledge, (insurance companies) have not issued the guidelines. The ground reality is that they are mocking at IRDA's directions,'' the President, All India Confederation of Goods Vehicle Owners' Association (ACOGOA), Mr B. Chenna Reddy, said in a communication to the IRDA Chairman, Mr N. Rangachary.
In fact, the transporters' body has requested IRDA to invoke the power that it had reserved to intervene and specify the guidelines.
"Sixty days is too long a period for insurance companies to have understood and assimilated the intent and purpose of the IRDA directive. Hence, it would not be a day too soon for IRDA to invoke the power it has reserved to intervene and specify the guidelines by itself,'' Mr Reddy said.
In its May directive to companies, IRDA had threatened that in the event of continued "varied and violent interpretations'' (of motor tariffs taking place even after the new directive), the authority would step in and frame guidelines to be implemented by them. The ACOGOA Vice-President, Mr Chittaranjan Dass, said owners of transport vehicles were once again getting agitated over the attitude of the insurance companies.
"If insurance companies decide to openly violate the orders of the regulator, transporters should not be blamed if they decide to go on an agitation against insurers,'' Mr Dass said.
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