Insurance companies have said the poor performance of compulsory motor third-party liability insurance business is making victims of road carnage more vulnerable, calling for the amendment of its legal framework.
Motor third-party insurance is a statutory requirement provided for under the Motor Vehicle Insurance (Third Party Risks) Act, 1998.
However, according to the Uganda Insurers Association (UIA), the performance of third-party class insurance under the Act has been unsatisfactory, according to a report by New Vision.
“The poor performance of the said insurance class is as a result of lack of proper enforcement systems class, poor coverage of vehicles having the required insurance and poor compensation records despite the costs involved,” said UIA’s CEO, Paul Kavuma.
He added that because the law caters for a maximum liability limit of UGX1m ($274), “there has been a poor intake of the motor third-party insurance because for all intents and purposes this money becomes insufficient in some cases; therefore, there is need to amend the law to increase in liability limit.”
Mr Kavuma was presenting UIA’s position on the Traffic and Road Safety Act 1998 (Amendment Bill) to the parliamentary committee on physical infrastructure.
Currently, only 40% of registered vehicles in the country have the required insurance.
Mr Kavuma said, “We agree that the law should be amended to include insurance coverage for everyone in and on the insured vehicle including drivers of these cars caught in the accidents, regardless of fault.” “Whether it’s overloading or reckless driving, whoever is to blame doesn’t matter because this is life that we are talking about, so insurance should cover them and this should be in addition to that of the owner and his employees,” he said.