Supreme Court Extends Mandatory Third-Party Insurance Cover for New Vehicles by One Year; IRDAI Asked to Explore Fuel-Insurance Link
Move Aims to Boost Insurance Compliance, Protect Road Accident Victims, Strengthen Road Safety Measures
New Delhi, Aug 5 (KNC): In a major step towards enhancing road safety and safeguarding the rights of accident victims, the Supreme Court on Wednesday extended the mandatory third-party insurance cover for newly purchased vehicles by an additional year, seeking to ensure uninterrupted insurance protection and improve compliance with statutory requirements.
The apex court observed that a significant number of vehicles continue to operate on roads without valid third-party insurance, leaving victims of road accidents vulnerable to financial losses and defeating the objective of the Motor Vehicles Act. It noted that uninterrupted insurance coverage is essential for providing timely compensation to victims and reducing legal and financial complications arising from accidents.
To further strengthen enforcement of mandatory insurance provisions, the Supreme Court directed the Insurance Regulatory and Development Authority of India (IRDAI), in consultation with the Ministry of Road Transport and Highways (MoRTH), to prepare a pilot project examining the feasibility of linking the purchase of fuel with the availability of valid third-party insurance.
The proposed mechanism is aimed at encouraging vehicle owners to maintain active insurance policies and preventing uninsured vehicles from operating on public roads.
Reiterating that third-party insurance is a statutory obligation under the Motor Vehicles Act, the court stressed that it serves as a crucial safeguard for road accident victims by ensuring financial protection against liabilities arising from accidents.
The Supreme Court also urged the concerned authorities to evolve effective and practical mechanisms to guarantee that every vehicle on Indian roads remains covered by valid third-party insurance, thereby strengthening public safety and improving compliance with the law. (KNC)
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