News / National
Third party insurance premiums rise 20%
05 Jun 2016 at 11:14hrs | Views
THIRD party insurance premiums for motor vehicles have been hiked by 20 percent to $36 per term from $30 last year for light vehicles, while premiums paid by commuter omnibuses have been revised to $88 from $60, it has been established.
The increase coincides with the Zimbabwe National Road Administration (Zinara)'s computerisation programme, which has seen only 20 insurance firms being accredited on its new digital database.
The computerisation exercise of motor vehicle insurance is designed to stem the issue of fake insurance cover to unsuspecting motorists.
Over the years, the manual entry system has been making it difficult for the Traffic Safety Council of Zimbabwe (TSCZ) to collect the statutory 12 percent levy that is paid from third party insurance firms.
So far, a total of 20 out of 22 insurance companies have registered to access Zinara's new transacting platform.
The system records every transaction detail and can provide an audit trail for the benefit of all stakeholders that include TSCZ, Zimra (Zimbabwe Revenue Authority) as well as the insurance companies. Government intends to create a road fund to promote road safety.
Transport and Infrastructural Development Minister, Dr Joram Gumbo said fake insurance policies were affecting the effective mobilisation of the fund.
"All along, third party insurance was one boulevard to compensate road victims, but had not helped matters as it was exacerbated by the proliferation of fake insurance policies.
"I have set up a Road Accident Fund which will go a long way in helping accidents victims," said Dr Gumbo.
If the programme is fully implemented, more than $108 million will be realised per year through third party insurance given that about 1, 2 million vehicles are currently registered on Zinara's database.
Estimates suggest that Government loses $5,4 million annually through fake premiums.
Through the new system, which began on May 2, 2016; Government will be able to easily verify revenues collected through insurance companies.
The Insurance Council of Zimbabwe, which superintends over the insurance sector, could not respond to questions sent a fortnight ago pertaining to the premium increases.
The increase coincides with the Zimbabwe National Road Administration (Zinara)'s computerisation programme, which has seen only 20 insurance firms being accredited on its new digital database.
The computerisation exercise of motor vehicle insurance is designed to stem the issue of fake insurance cover to unsuspecting motorists.
Over the years, the manual entry system has been making it difficult for the Traffic Safety Council of Zimbabwe (TSCZ) to collect the statutory 12 percent levy that is paid from third party insurance firms.
So far, a total of 20 out of 22 insurance companies have registered to access Zinara's new transacting platform.
The system records every transaction detail and can provide an audit trail for the benefit of all stakeholders that include TSCZ, Zimra (Zimbabwe Revenue Authority) as well as the insurance companies. Government intends to create a road fund to promote road safety.
Transport and Infrastructural Development Minister, Dr Joram Gumbo said fake insurance policies were affecting the effective mobilisation of the fund.
"I have set up a Road Accident Fund which will go a long way in helping accidents victims," said Dr Gumbo.
If the programme is fully implemented, more than $108 million will be realised per year through third party insurance given that about 1, 2 million vehicles are currently registered on Zinara's database.
Estimates suggest that Government loses $5,4 million annually through fake premiums.
Through the new system, which began on May 2, 2016; Government will be able to easily verify revenues collected through insurance companies.
The Insurance Council of Zimbabwe, which superintends over the insurance sector, could not respond to questions sent a fortnight ago pertaining to the premium increases.
Source - sundaymail
