China is set to double the maximum coverage of mandatory vehicle insurance policies and cut the premium rates by an average 10 percent, the top insurance regulator told a hearing last Friday.
The top limit for the mandatory vehicle policy is set to be doubled to 120,000 yuan (US$16,239), a hearing by the China Insurance Regulatory Commission was told last Friday in Beijing.
The proposal came from the Insurance Association of China representing 24 car insurers.
At the same time, insurance premiums will drop between five and 39 percent for 16 of the 42 types of motor vehicles covered by the proposal.
About 64 percent of policy holders will enjoy an average rate cut of about 10 percent, according to the proposal.
The under six seater home vehicle, one of the most popular vehicles in China, enjoys a 9.5-percent premium decrease in the proposal, cutting the premium to 950 yuan.
Compensation for any death and injuries in a car accident will be limited to 110,000 yuan under the new plan while up to 8,000 yuan will be used to offset medical treatment and the remaining 2,000 yuan will go towards compensation for property loss, Chen Donghui, a representative of the association, explained at the hearing.
Death and injury compensation now stand at 50,000 yuan.
Victims in an accident where the driver is not at fault will receive 11,000 yuan in death and injury compensation, according to the plan.
The hearing triggered heated discussion last Friday and lasted for five-and-a-half hours. No final decision was made - the regulator said it will take advice from the hearing but did not disclose when it would make a decision.
Twenty-two delegates attended the hearing. Three were experts, four were from the public, 12 were policy holders and the remaining three were from the insurance association.