| Safe driving earns 30 percent insurance rebate |
SHANGHAI, June 28 -- DRIVERS with a safety record of being involved in no accidents for the past three years can now receive a 30 percent discount under the new mandatory vehicle insurance rule which comes into effect from July 1.
The new mandatory vehicle insurance regulation will adopt a floating premium rates based on a driver's accident record rather than the current flat rate, Xinhua news agency reported today.
The policy, made by China Insurance Regulatory Commission, the country's top insurance regulator and the Ministry of Public Security, will offer good drivers a discount of 10-30 percent according to the number of years of safe driving, the report said.
However, drivers who are responsible for a fatal traffic accident in the previous year must pay up to 30 percent more for their coverage while those who are involved in more than two accidents must pay 10 percent more.
Drivers guilty of causing a fatal accident will be jailed and banned from driving, according to China's law.
The savings on the insurance payment can run into hundreds of yuan a year given that the nationwide premium for family car owners is 1,050 yuan (US$137) annually.
A draft rule of the policy was posted on the regulator's Website on June 15 to solicit public opinion, which sparked concerns among many drivers who complained that the evaluation terms for the rebates were too strict.
One evaluation prescribed that drivers could have the lower rates only if they had not breached any traffic law in the previous year.
Many drivers complained that meeting the discount requirement was almost ``mission impossible'' as traffic police are inclined to hide to catch drivers.
And new drivers can easily break traffic laws if they are somewhere they are not familiar with.
The regulator revised the conditions and in the final version attached the discounts requirements to an absence of accidents on a driver's record rather than no breaking of traffic laws, making it easier for drivers to earn lower rates.
It also expanded the maximum discount for good drivers from 20 percent to 30 percent to encourage more safe driving.
China introduced a nationwide mandatory vehicle insurance policy last July, forcing owners of the country's more than 130 million cars, motorcycles and tractors to buy insurance policies.
The policy allows for a maximum payment of 60,000 yuan to cover injuries, medical fees and property loss no matter which driver was at fault in an accident.
The insurance policy was a complementary to a national traffic law that went into effect in 2004.
The law requires that when an accident occurs between a motor vehicle and a pedestrian or cyclist, the driver must compensate for deaths, injuries and damages, unless there is evidence to prove the other party caused the accident on purpose.
But it triggered driver complaints that they have to pay compensation even when they are innocent.
Shanghai has enacted the same floating rates system for mandatory vehicle insurance on July 1 last year, which was a pilot trial for the nationwide new regulation. Good drivers in Shanghai will pay a minimum 735 yuan while unsafe drivers have pay up to 1,785 yuan.
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