China to streamline handling of car crash cases

New online system could reduce mediation times and save on legal costs

China to streamline handling of car crash cases

Insurance News

By Gabriel Olano

China has introduced a pilot program that will bring the resolution of car crash-related disputes online, increasing efficiency and cost-effectiveness.

The Government is encouraging motorists to join an online system to resolve traffic incidents in 13 cities and provinces.

The system will allow motorists to seek legal redress and receive motor insurance claims online, reported English-language news outlet Sixth Tone.

The number of traffic accidents is rising in China, owing to rapid urbanisation and growing car ownership. In Mentougou District, Beijing, traffic cases have increased by 30- 40% annually for the past two years.

Resolution of a car crash case can be a lengthy process, including police investigation, analysis of compensation, negotiation, and the distribution of insurance payouts. In case the parties fail to reach an agreement, a mediator will have to open a civil prosecution case.

“The mediation period will be reduced significantly,” Jiang Lifeng, a traffic incident mediator, told state media arm Xinhua. “Before, it took at least a month; now, it has been reduced to seven to 10 working days.”

The online system can also reduce costs, as shown by the Hangzhou branch of state-owned insurer People’s Insurance Company of China (PICC). The branch has been a member of a pilot program since 2016.

PICC reported the program prevented 150 cases from reaching the courts, which halved the number of its litigation cases. According to PICC’s calculations, the system has saved it around RMB450,000 (US$68,000) in legal fees.

The test period for the online traffic court will run for two years, with each municipality or province launching it at its own pace, the report said.

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