GOVERNMENT recently issued Statutory Instrument number 33 of 2015 (SI 33) that makes it compulsory to display insurance certificates on all motor vehicles/trailers.
Minister of Transport, Works, Supply and Communication Yamfwa Mukanga signed the SI on June, 8 2015.
+“A disc shall be displayed on a motor vehicle or trailer in a manner that ensures that the disc is easily distinguishable and clearly
visible at all times, and does not become defaced,” reads part of the SI.
This means that when one buys insurance they need to stick it on to the wind shield the same way they display road tax and fitness discs.
Failure to do this contravenes the law and one is liable to conviction.
“A person shall not use or permit another person to use a motor vehicle or which a security or insurance disc is not displayed in
accordance with these regulations”.
This places direct or indirect responsibility on either the owner/driver of the vehicle to ensure that a disc is displayed on a
vehicle before it is driven on a public road.
Therefore, motorists should ideally have two or three discs namely insurance, road tax and/or fitness certificates.
“Some of the features on the disc will include make and model of the vehicle, chassis number and town of issue,” reads part of the SI.
Such regulations are not peculiar to Zambia. There are similar laws in Tanzania, Democratic Republic of Congo (DRC) and many other countries.
What does this move mean to stakeholders?
Firstly, to motorists SI 33 strictly speaking is simply enforcing an existing law that already makes it compulsory for all motorists to insure their vehicles with a minimum of third party insurance.
In terms of costs, it is life as usual to motorists except for a small fee for a sticker if this will not be provided by the insurer.
There are no financial implications to those who have been insuring their vehicles.
The benefit to the complying motorists is the fact that should they be hit by another vehicle they will have no headaches of directly pursuing such offenders who may not have resources to compensate them but will be assured of compensation from insurers of the negligent motorists.
To insurers; although there has been a law that compels all motorists to insure their vehicles, many will agree that a considerable number of vehicles still move without insurance.
This is evidenced in many uninsured vehicles through subrogation cases.
With SI 33,  I believe this gap will be bridged provided that our law enforcing agents will strictly enforce this law to the latter.
When most vehicles have insurance it also means insurers will benefit from the much needed premium contributions to their pools.
This will increase liquidity which will ease the paying of claims and in the end that injured or affected third party will ultimately benefit.
Under the same token it is expected that insurance periods will now stringently run in quarters unlike the current situation where the period do not follow the calendar quarters.
For example insurance can start on  the 13th of say, February and end on May 12.
The hurdle with such insurance periods is that one may have road tax but without insurance in force simply because it expired before the end of the quarter and was not renewed resulting in many uninsured vehicles.
When it comes to the general public, there is now assurance that should any passenger, pedestrian, cyclist or other motorist be injured or get their properties damaged by a vehicle then there is an insurer out there who will pay for such damages.
Contrast this with a situation where an uninsured vehicle rams into a building and damages it and this motorist has no funds to pay for the repairs of the building.
With insurance in place, both the motorist and the owner of the building will simply go to the insurer of the vehicle and make a claim. The insurer will then be able to pay for the damages occasioned by their insured.
Lastly the ‘increased premiums’ will mean more tax revenue to the Government.
SI 33, therefore, comes with undeniable benefits to all stakeholders involved and should not just be complied to but most importantly supported.
As an insurance expert I say kudos to Government and all stakeholders involved in creating this regulation and I appeal to enforcers to do their part diligently.
Comments: webster@picz.co.zm or webster_tj@hotmail.com or on face book search for Insurance Talk-Zambia page or call/text 0977 857 055
(The Author is a Chartered Insurer with more than 10 years industry experience)