Insurance companies have been cautioned against the issuance of insurance policies to cover motorcycles (Okada) and tricycles (motor rickshaws/Pragya) used for all commercial purposes, except courier and delivery services.
A circular issued by the National Insurance Commission (NIC) on Monday August 3, 2020 and signed by Mr. Michael K. Andoh, Deputy Commissioner of Insurance, warned that the Commission would take appropriate sanctions against any insurance company that breaches the directive.
The directive comes from the realisation that some insurance companies issue policies to cover motorcycles and tricycles used for commercial purposes, including the carriage of fare paying passengers.
The Commission reminded all chief executive officers and managing directors of non-life insurance companies and insurance intermediaries that Regulation 128 of the Road Traffic Regulation 2012, Legislation Instrument (L. I. 2180) prohibits the usage of motorcycles and tricycles to carry fare-paying passengers.
It further stated that the same Road Traffic Regulation also prohibits the Driver and Vehicle Licensing Authority (DVLA) from licensing motorcycles and tricycles to be used to carry fare-paying passengers.
The Commission stressed that the usage of motorcycles and tricycles for the carriage of fare-paying passengers was illegal.
As a result, the Commission has categorically stated that accident victims who are fare-paying passengers on motorcycles or tricycles will not qualify for compensation from the Motor Compensation Fund.
Regulation 128 of the Road Traffic Regulations, 2012, LI 2180 provides that the use of motorcycle or tricycle for commercial purpose is prohibited.
The Road Traffic Regulations also stipulates that the licensing authority shall not register a motorcycle or tricycle to carry a fare-paying passenger, and that a person shall not use or permit a motorcycle or tricycle, over which that person exercises control, to be used for commercial purposes except for courier and delivery services.
It also states that a person shall not ride on a motorcycle or tricycle as a fare-paying passenger.
The post No compensation for motorcycle, tricycle accident victims -Insurance Commission appeared first on The Chronicle Online.
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