New motor vehicle levy to come into effect next month

taxiVehicle owners from January 1st will no longer pay Third Party Insurance/CTP Insurance as the new Accident Compensation Act comes into effect.

Vehicle owners will pay a Motor Vehicle accident levy as premium for being covered by the Compensation scheme administered by the Accident Compensation Commission (ACCF).

The ACCF is a corporate body under the Accident Compensation Act 2017 to make provisions for compensation in result of persons who suffer personal injury of death as a result of a motor vehicle accident.

The Act and the new ‘no fault’ compensation scheme will apply to vehicle accidents occurring on or after January 1st.

This means motor vehicle owners will pay the relevant MVA levy to the Compensation Commission and the LTA will collect the levies in line with its existing vehicle registration process.

Private and commercial motor vehicles will be charged $63 MVA levies, light good and heavy goods vehicle that will carry no less than eleven passengers will be charged $126 while Taxi’s and License Hire vehicles up to five passengers are charged $135.

Minibuses and Licensed hire vehicles that carry more than five passengers will pay $248 while omnibus will be charged $306.

The Commission says the MVA levy is cheaper than third party insurance.

Vehicle owners whose CTP insurance expires on or after January 1st are advised to enquire with the nearest LTA office on how they should pay the MVA levy.

The LTA is expected to charge the MVA levy as part of the registration process for new or renewed vehicles.

This will benefit vehicle owners as it allows for compensation under the No Fault Compensation scheme by the Commission without the need to establish fault or negligence however there may be some exclusions.

The scheme provides compensation for any personal injury or death as a result of an accident involving a registered vehicle.

PSV owners and passengers are also eligible for compensation of amounts similar to other classes of motor vehicles.

For bus passengers, this means the maximum payout for compensation in the event of an accident is $75,000 per passenger compared to the repealed third party insurance of $4000 for each passenger.

The insurance covers all passengers inside the registered vehicle including the driver any third party at the time of the accident.