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Dispute arises between old, new laws
By Liu Li (China Daily)
Updated: 2004-10-22 00:14

Disparities between the country's new traffic safety legislation and old but still unchanged insurance rules were at the crux of a lawsuit Thursday in Beijing.

The Road Traffic Safety Law, which was passed in May, was pitted against still current insurance regulations after an insurance company refused to pay compensation when a farmer was killed in August.

The case was sparked by Liu Binghua, who knocked down and killed a Sichuan Province farmer last August while operating a crane at night in Beijing.

Local officials said at the time that it was impossible to determine whether the area was clearly marked and no decision was reached on the cause of the accident.

Still, the Chaoyang District traffic control department ordered Liu to pay 100,000 yuan (US$12,100) to the victim's family.

According to the Road Traffic Safety Law, when accidents occur between motor vehicles and pedestrians, resulting in injuries, insurance companies should pay compensation within the range of compulsory third party insurance.

Any compensation beyond that is the responsibility of the driver.

The crane carrier was insured for 50,000 yuan (US$6,000) and Liu asked his insurer to pay 40,000 yuan (US$4,800).

However the Beijing Branch of the Property and Casualty Company Limited of the People's Insurance Company of China refused.

Liu then sued the insurance company, demanding it pay the compensation. The first hearing on the case was held yesterday and no decision was reached.

Zhang Yong, an insurance company representative, said it did not pay because officials did not put the blame on Liu.

"Although our client Liu shouldered the full compensation responsibility of the accident, there is no proof that he is fully responsible for the accident," Zhang told the court yesterday.

According to the insurance agreement signed between the insurance company and Liu, which was approved by the China Insurance Regulatory Commission, the amount of compensation is fixed according to the insured's responsibility in accident.

"The traffic control department is obligate to fix responsibility of the accident. It is the nonfeasance of government that resulted in the current dispute," he said.

But Liu says the new Road Traffic Safety Law makes the issue black and white.

"When there is contradiction between the law and the contract item, the law should be enforced," he said yesterday.

Zhang said he hoped municipal regulations relating to the implementation of the law will solve disputes between the law and previous regulations.

The Standing Committee of the Beijing Municipal People's Congress was to vote on those regulations today.

Although the Road Traffic Safety Law is already in the books, the closely related Insurance Law remains unchanged, said Jiao Hongchang, a law professor with the China University of Political Science and Law.

"The two laws are not harmonious now, which will endanger the interests of vehicle owners," he said.

Jiao called for more financial assistance from the government in the field.

"To establish a social insurance fund to deal with compensation towards victims in accidents should be our goal," he said.

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