Insurance companies report boom in business after new, strict traffic rules

Insurance companies expect the new regulations to bridge the gap between insured and un-insured vehicles significantly

Stringent punishment proposed under the new Motor Vehicles Act might have made car owners frown but insurance companies are laughing all the way to the bank. There has been an uptake in sale of motor insurance thanks to the new regulations.

The new Motor Vehicles Act came into effect on September 1. It has enhanced penalties for various driving errors.

According to the new law, if a vehicle is on the road without insurance, then a fine of Rs 2,000 and imprisonment of up to three months can be imposed for the first offence. For subsequent offences, a fine of