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Expert advises banning 'irrational' compulsory insurance

By Song Hongmei (chinadaily.com.cn)
Updated: 2006-10-31 11:25

Unreasonable requirements in some compulsory insurances should be reviewed or cancelled, said an industry regulatory official last week.

Compulsory insurance charges on railway passengers is irrational, said Yang Bohua, director of the Legal Affairs Department of the China Insurance Regulatory Commission at an insurance forum in Beijing.

Two percent of the price of a train ticket goes to railway accident compulsory insurance with claims limited to 20,000 yuan (US$2531). The practice has been implemented in accordance with the Regulations on Compulsory Accident Insurance for Railway Passengers since 1951.

With the economic development of the past five decades especially the last twenty years, medical expenses and fees for absences from work have increased greatly. Recently a person injured on the railway found that the 20,000-yuan accident coverage was not enough.

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The full text is available in the October Issue ofChina Insurance.