The Insurance Regulatory and Development Authority of India (IRDAI) has mandated all general insurers with motor insurance business to provide an inbuilt feature in the Third Party policy (TP) to cover to employees travelling in an employer’s vehicle (including paid driver, if applicable) under IMT. 29 of the Indian Motor Tariff 2002.

• The compulsory cover of IMT-29 should be provided as an in-built coverage under the Compulsory Motor Third Party(TP) Liability Section of Private Car Package/ Bundled Policies and under standalone policies insuring Compulsory Motor Third Party Liability.
• IRDAI also stated that no additional premium will be charged until further directions.

Background:
i.Madras High Court(Chennai, Tamil Nadu) has directed IRDAI to make
IMT-29 compulsory as an inbuilt coverage for employees while issuing a Private Car policy for employer’s vehicles.
ii.In accordance to the High Court order, IRDAI has issued the above directions in exercise of the powers conferred by Section 14(2) of Insurance Act 1938.
About Section 29 of India Motor Tariff (IMT) 2002:
i.The insurer will pay for any damages that the insured is legally liable for under the Fatal Accidents Act, 1855, if an employee (other than a paid driver) is killed or injured while using the insured vehicle(Upon payment of premium Rs.25/employee).
ii.The compulsory cover of IMT-29 shall be provided as an inbuilt coverage
under the Compulsory Motor Third Party Liability Section of Private Car
Package/ Bundled Policies and under standalone policies insuring
Compulsory Motor Third Party Liability.
Clause 7 of Section 2 of IMT:
i.The employees travelling in or driving the employer’s motor vehicle will be covered under the insurance with the payment of premium of Rs.50/employee.
• The tenure of the premium is extended till 12months on payment of additional amount (Rs.50/employee).
ii.The maximum number of employees covered under the insurance equals the maximum licensed seating capacity of the vehicle.