Press Information Bureau

Government of India

Ministry of Finance

12-August-2011 16:34 IST

Solatium fund to Compensate Accident Victims in Hit and Run Cases

In ‘Hit & Run’ cases, accident victims are eligible for compensation through a Special Fund constituted in terms of Section 163 of the Motor Vehicles Act, 1988 called ‘Solatium Fund’. The amount of Compensation is `25,000/- in the event of death and `12,500/- for grievous injuries. A portion of the Gross Written Premium is contributed towards this Fund every year by both Public and Private Insurers. However, in case the vehicle is without insurance, the victim/dependents has the right to claim compensation from the owner/driver under Motor Vehicles Act, 1988.

The Sundar Committee appointed by Ministry of Road Transport & Highways (MoRTH) has recommended that the Certificate of Insurance should be co-terminus with the validity of Certificate of Registration of the motor vehicle.

The MoRTH has informed that there is no proposal to levy one-time insurance premium from new vehicles to compensate road accident victims.

This information was given by the Minister of State for Finance, Shri Namo Narain Meena in written reply to an Unstarred Question in Lok Sabha today.

DSM/SS/PM

Solatium fund provides compensation for hit-and-run victims and preserves claim rights against uninsured vehicle owners. Compensation for hit-and-run victims is provided through the Solatium Fund under the Motor Vehicles Act, funded by insurer contributions from Gross Written Premiums; victims may also claim from uninsured vehicle owners or drivers. The Sundar Committee recommended aligning insurance certificate validity with vehicle registration, while the Ministry has not proposed a one-time premium on new vehicles to fund compensation.