The Supreme Constitutional Court, the highest judicial power in the country, has ruled that it is discriminatory to provide insurance only to passengers who are named in a motor third-party liability policy as allowed to ride in a commercial vehicle, while excluding others in the same vehicle but are not named in the policy.
The Court, in its ruling issued recently, said that a clause in the insurance law limiting the scope of the cover in this manner is against the provisions of the Constitution, reported the Middle East News Agency.
The scope of coverage should include all passengers in the vehicle, the Court said. The ruling is expected to increase compensation payable by insurers.
The legal compensation in the case of death and total permanent disability as a result of a motor accident is EGP40,000 (US$2,270), and a percentage of this figure in the case of partial disability.
Meanwhile, the Insurance Federation of Egypt (IFE) and insurers are considering the decision of the Supreme Constitutional Court.
The Financial Regulatory Authority (FRA) is the governmental body entrusted with considering the legal and legislative aspects of insurance laws, said Mr Alaa El-Zoheiry, IFE President, in remarks to Vetogate. Therefore, it is expected that FRA will examine with legal experts the decision of the Court on the non-constitutionality of the clause in the insurance legislation.
Meanwhile, the IFE held a meeting with law and corporate consultants to find a solution to the issue.
Premiums for mandatory insurance are determined based on tonnage for commercial vehicles, the number of passengers for taxis and engine capacity for private-use vehicles, according to media reports. M
EGP1 = US$0.06