Delhi Lieutenant Governor (LG)&nbsp;VK Saxena has suggested India's Finance Minister&nbsp;Nirmala Sitharaman to establish a system in which the vehicle insurance&nbsp;premiums are linked with traffic violations.&nbsp;

This would mean that the more traffic violations recorded and challans generated, the insurance premium for next year would be higher accordingly.

In the letter, Saxena emphasised that such a system is important to enhance&nbsp;road safety&nbsp;and promote responsible driving behaviour.

"I am writing to draw your kind attention to a matter of critical importance concerning road safety and vehicular insurance in India," wrote Saxena, in the letter.

"I would like to suggest for your consideration that&nbsp;insurance premiums&nbsp;should be index-linked with the number of traffic violations recorded against a vehicle, which would have a salutary impact on road safety and traffic discipline," he added.

"There is an obvious correlation between repeat traffic offences and the risk of accidents. I would therefore suggest that a layered insurance premium system based on the frequency and severity of traffic violations, as recorded in MoRTH's VAHAN database, may be introduced," the lieutenant governor explained.

Also Read:&nbsp;<a href="https://www.wionews.com/trending/not-just-red-amber-and-green-traffic-lights-will-have-a-new-colour-heres-why-749369">Not just red, amber and green, traffic lights will have a new colour. Here's why</a>

He said that vehicles with a history of over-speeding and dangerous driving need to be subjected to higher insurance premiums which can work as a financial deterrent and encourage safe driving habits among drivers.

He said that similar systems have been in place in other countries.

"Such measures have been successfully implemented in other countries such as the United States, where insurance premiums increase significantly based on traffic violations and speeding tickets, leading to an average premium increase of 20 to 30%," he said.

"Linking insurance premiums to traffic violations would not only align insurance costs with risk but also reduce the financial burden on insurers due to claims arising from frequent accidents," Saxena added.&nbsp;

Watch:&nbsp;Bangladesh-India passenger traffic drops

<div class="videoWrapper trancodeVideo"><iframe allowfullscreen="" autoplay="1" class="includeVideo" frameborder="0" height="350" src="https://www.wionews.com/videos/bangladesh-india-passenger-traffic-drops-758618/embed" style="width:100%;max-width:560px;" width="560"></iframe></div>

"This market-driven solution would encourage responsible driving, contribute to reduced road accidents, save lives, and ensure better management of insurance claims," he said.

<h2>Challan-insurance linked model can reduce accidents: LG</h2>

India recorded more than 4.37 lakh road accidents in 2022 among which 70 per cent of cases were of over-speeding.

The lieutenant governor stated that if this model gets adopted in India, it can establish a new benchmark in road safety initiatives.

"By adopting this system, India could significantly reduce its alarming rate of road accidents. If implemented, this policy could be a pivotal step towards reducing road fatalities, preserving lives, and ensuring a safer, more sustainable future on Indian roads," Saxena said.

(With input from agencies)

Delhi Lieutenant Governor (LG) VK Saxena has suggested India's Finance Minister Nirmala Sitharaman to establish a system in which the vehicle insurance premiums are linked with traffic violations.

Delhi Lieutenant Governor (LG) VK Saxena has suggested India's Finance Minister Nirmala Sitharaman to establish a system in which the vehicle insurance premiums are linked with traffic violations. This would mean that the more traffic violations recorded and challans generated, the insurance premium for next year would be higher accordingly. In the letter, Saxena emphasised that such a system is important to enhance road safety and promote responsible driving behaviour. "I am writing to draw your kind attention to a matter of critical importance concerning road safety and vehicular insurance in India," wrote Saxena, in the letter. "I would like to suggest for your consideration that insurance premiums should be index-linked with the number of traffic violations recorded against a vehicle, which would have a salutary impact on road safety and traffic discipline," he added. "There is an obvious correlation between repeat traffic offences and the risk of accidents. I would therefore suggest that a layered insurance premium system based on the frequency and severity of traffic violations, as recorded in MoRTH's VAHAN database, may be introduced," the lieutenant governor explained. Also Read: Not just red, amber and green, traffic lights will have a new colour. Here's why He said that vehicles with a history of over-speeding and dangerous driving need to be subjected to higher insurance premiums which can work as a financial deterrent and encourage safe driving habits among drivers. He said that similar systems have been in place in other countries. "Such measures have been successfully implemented in other countries such as the United States, where insurance premiums increase significantly based on traffic violations and speeding tickets, leading to an average premium increase of 20 to 30%," he said. "Linking insurance premiums to traffic violations would not only align insurance costs with risk but also reduce the financial burden on insurers due to claims arising from frequent accidents," Saxena added. Watch: Bangladesh-India passenger traffic drops "This market-driven solution would encourage responsible driving, contribute to reduced road accidents, save lives, and ensure better management of insurance claims," he said. Challan-insurance linked model can reduce accidents: LG India recorded more than 4.37 lakh road accidents in 2022 among which 70 per cent of cases were of over-speeding. The lieutenant governor stated that if this model gets adopted in India, it can establish a new benchmark in road safety initiatives. "By adopting this system, India could significantly reduce its alarming rate of road accidents. If implemented, this policy could be a pivotal step towards reducing road fatalities, preserving lives, and ensuring a safer, more sustainable future on Indian roads," Saxena said. (With input from agencies)

Delhi LG suggests FM Sitharaman link vehicle insurance to traffic challans. Here's how it will impact premiums

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