The law requires all public service vehicles, such as taxis and buses, to be insured for passenger liability, so that injured passengers may file claims against the drivers and receive compensations from insurance companies.

However, insurance companies would repudiate cover if the vehicles were driven under the influence of drugs or alcohol, or the vehicles or drivers without valid licences.

Suing such drivers would probably be a waste of time and money, and hopes are dashed as most of them do not have the means to pay.

The law also requires all motor vehicles to be insured for third party injuries, but a large number on the road are without road tax and motor insurance, and many motorists and motorcyclists are without valid licences.

As such, many road accident victims, including passengers in public service vehicles, would not be compensated. Those who filed claims would have to wait several years for the courts to award compensation.

Clearly, there are big loopholes in mandatory third party and passenger liability covers, but nothing has been done to plug them.

As for taxis and ride-hailing vehicles, passengers will be insured if there is personal accident insurance cover, as claims are swiftly paid out for injuries without the need to establish fault.

The minimum sum insured for all unnamed passengers should be RM50,000 and RM5,000 medical expenses, and the maximum capped at RM100,000 and RM10,000 respectively, so that premiums remain affordable.

Passengers with higher net worth can always take up life, medical, personal accident and travel insurances on their own, as the proposed sum is adequate for half of the population.

As taxi and ride-hailing drivers are self-employed, they should be given a safety net and enjoy the same cover under a package deal.

If an insurance company can step forward to cover the vehicle, driver and passengers under a total package, it should be able to corner the market.

As it is, the comprehensive premium for private vehicles is RM26 for every RM1,000 sum insured, and taxis at RM69.80.

Private vehicles are without any insurance cover when used for hire or reward, meaning there is no cover for the vehicle, no third party cover as required by law and no passenger liability cover.

As ride-hailing services will be legalised in March, it makes perfect sense that motor insurance for taxis and ride-hailing vehicles be standardised.

A compromised rate will be RM47.90 for every RM1,000 sum insured. The figure is derived by adding RM26 to RM69.80 and dividing by two.

This will allow operators using limousine taxis and hire-and-drive vehicles to switch to private vehicles and enjoy a lower premium, as they are paying an astronomical high of RM102.50 and RM122.10 respectively, for every RM1,000 sum insured.

Hopefully, legalising of ride-hailing services can bring some positive developments to legal taxi operators and drivers, as they had remained in the doldrums for far too long.