The plight of the lowly maxi-taxi driver facing the prospect of a 100 per cent increase for third-party insurance premiums as reported in the media raises many questions. Such a sudden increase is forbidding and mind-boggling in any situation but equally so is the reason quoted by the Governor of the Central Bank, who alleges that insurance companies were undercharging for such insurance and so were unable to pay their reserve requirements. Would any business entity knowingly undercharge its clients to its detriment, as in this case, or is it a matter of gross negligence or incompetence on its part?
Instead of placing blame on the maxi-taxi drivers and punishing them, is there need, according to one driver, for the Governor "to examine if there are other reasons why insurance companies are not putting the right amount in the reserves?" Could they be siphoning funds in other areas and neglecting the reserve? From another angle, is it possible, like in the Clico affair, there is once again an absence of regulatory measures from the Central Bank to prevent a problem of this nature, leading to this sudden attempt to rectify it? Why is the penalty not being directed to the corporate citizen in this instance, as it should be in the Clico affair, instead of the maxi-taxi driver and the investor having to pay the cake?
Should the law, or the attempt to solve the problem, always favour the one and be against the other?
This sudden increase in insurance is of additional significance in that third party has always been the affordable option in a situa-tion of compulsory insurance. How are the maxi drivers going to cope?
Additionally, this problem, predictably, is likely to lead to an across-the-board increase in rates of insurance with all drivers on the receiving end. Seeing to it that the regulatory mechanism in the Central Bank does its job and that corporate citizens bear the penalty when they are liable is one sure way for the Government to serve the people.
Dr Errol Benjamin
Via e-mail