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Zimbabwe govt to run third party motor vehicle insurance scheme

by Staff reporter
01 Dec 2023 at 16:01hrs | Views
Finance Minister Mthuli Ncube, in his budget speech on Thursday, declared that the government would assume control of third-party motor vehicle insurance starting April 2024. Ncube emphasized that motorists were experiencing challenges with insurance companies, which he deemed "profit-oriented" and lacking motivation to adequately compensate for losses. To address this issue, the government is stepping in to manage third-party insurance for both private and public motor vehicles.

Ncube explained to MPs, "Third-party insurance, mandated by the Road Traffic Act, serves to mitigate losses resulting from road accidents and property damages. With road traffic accidents being a leading cause of global deaths and injuries, the current private insurance model has proven challenging in enforcing third-party liabilities due to profit-oriented practices."

"In light of this," he continued, "I propose that the government takes over the responsibility for third-party motor vehicle insurance, aligning with the practices of neighbouring countries."

As per legal requirements, all vehicles must be insured, with the commonly used third-party scheme providing liability coverage in the event of an accident. Notably, Ncube did not address comprehensive insurance cover, a more expensive option that covers both third-party liabilities and the policyholder's vehicle.

Highlighting the inadequacies of the existing compensation limits outlined in the Road Traffic Act, Ncube proposed an expansion of the Third-Party Motor Vehicle Scheme. The enhanced coverage, effective April 1, 2024, will include medical benefits, rehabilitation, injury grants, funeral grants, and loss of income, addressing a broader range of needs beyond the current provisions for death, permanent disability, medical, and funeral expenses.

Source - zimlive