GUWAHATI: Expressing its shock that 56 per cent of vehicles in India are operating without valid insurance, the Supreme Court has asked the Centre to launch a pilot 'no insurance, no fuel' project.
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A Bench of Justices Sanjay Karol and Augustine George Masih on Tuesday, August 4, also extended the mandatory third-party motor insurance period for new vehicles by one year, directing that new cars will now require four years of third-party insurance coverage, while new two-wheelers will require six years of coverage.
A Bench observed that despite the statutory requirement under the Motor Vehicles Act, a “shocking” number of vehicles continue to ply on Indian roads without valid third-party insurance, leaving accident victims and their families struggling to secure compensation.
The Court noted that nearly 56% of vehicles in the country- around 16.54 crore out of an estimated 30 crore- are uninsured, citing a Parliamentary Committee report. It described the issue as one linked to the Right to Life under Article 21 of the Constitution, stating that mandatory third-party insurance is intended not only to ensure compensation for road accident victims but also to spare them lengthy legal battles.
While the Insurance Regulatory and Development Authority of India (IRDAI) and the General Insurance Council (GIC) had recommended against extending the insurance period, the Court ruled that increasing the mandatory coverage by one year would serve the interests of road safety.
In a significant proposal aimed at improving compliance, the Court directed the Ministry of Road Transport and Highways (MoRTH) and the IRDAI to formulate a pilot project exploring whether petrol and diesel should be supplied only to vehicles with valid insurance. The Bench said such a mechanism could encourage timely insurance renewals and help identify uninsured vehicles.
To strengthen enforcement, the Court also ordered the integration of Automatic Number Plate Recognition (ANPR) cameras installed on roads and highways with the Insurance Information Bureau (IIB) database and the VAHAN portal. This would enable authorities to automatically detect uninsured vehicles.
Additionally, the Court directed that police personnel across states be equipped with handheld devices or mobile applications linked to insurance databases and the VAHAN portal, allowing them to verify insurance status in real time and issue challans to violators on the spot.