Government redirect 5% of Third Party Insurance Cover to an Accident Compensation Fund
HARARE, Government will effective December 01, 2018 redirect 5% of the third part insurance cover to an accident compensation fund whose modalities are yet to be announced.
This has been driven by the increase in the number of accidents on the country’s roads, which have resulted in serious injury and, in some instances, carnage, which has become a major concern.
Finance Minister Mthuli Ncube said there exists and opportunity for third party Insurance to also contribute
towards expenses for accident victims exists as the accidents, which in most cases have claimed the lives of bread winners, place a huge financial burden on the injured victims, relatives as well as the State
Whereas the minimum requirement is that all motor vehicles should be covered under a Third Party Insurance, Ncube said the benefits are, however, restricted to compensation of the third party’s vehicle, hence remain obscure with a relatively low claims ratio.
“Consequently, premiums have largely been retained for the benefit of insurance companies. I, therefore, propose to redirect 5% of Third Party Insurance Cover to an accident Compensation Fund, with effect from 1 December 2018.Modalities of the Fund will be announced in due
course,” he said.
The Traffic Council of Zimbabwe is on record saying at least five people died daily in road accidents in 2017 totalling 1 838 deaths which were recorded last year, while 10 489 were injured in 42 430 translating to 153 deaths monthly for 2017.
The accidents revealed a 10% rise from 2016 figures, which had 38 620 crashes that killed 1 721 travellers.
This year in November alone over a hundred people died in road accidents as well as fire accidents Third party insurance is, or at least it should be, liability insurance purchased by an insured (the first party) from an insurer (the second party) for protection against the claims of another (the third) party.
However in Zimbabwe most drivers in Zimbabwe risk suffering loss of property as some insurance companies offer third-party insurance policies that do not actually cover third parties in the event of a crash.
Regulations demanding that all drivers have at the very least third-party insurance are put in place in the interest of protecting third parties who could fail to recover losses if the offending party does not have the means to pay.
