'No Insurance, No Fuel': Supreme Court Proposes Pilot Project, Flags 16.54 Crore Uninsured Vehicles

New Delhi: In a significant move to strengthen road safety and ensure compliance with mandatory motor insurance laws, the Supreme Court has directed the Centre and the Insurance Regulatory and Development Authority of India (IRDAI) to evolve a pilot project under which vehicles without valid third-party insurance could be denied fuel at petrol pumps.

A Bench of Justices Sanjay Karol and Prashant Kumar Mishra expressed concern over the large number of uninsured vehicles on Indian roads, noting that nearly 16.54 crore vehicles—around 56 per cent of the total registered vehicles-do not have valid insurance cover, despite third-party insurance being mandatory under the Motor Vehicles Act.

The court observed that linking fuel supply to a vehicle's insurance status would serve a dual purpose-identifying uninsured or unregistered vehicles and encouraging owners to obtain valid insurance. It noted that the Ministry of Petroleum and Natural Gas has, in principle, no objection to such a proposal.

The apex court also ordered a series of technology-driven measures to improve enforcement. It directed that Automatic Number Plate Recognition (ANPR) cameras be integrated with vehicle and insurance databases to automatically detect uninsured vehicles and generate e-challans.

State police have also been asked to use handheld devices or mobile applications linked to these databases for real-time verification of insurance status.

In another key direction, the court extended the mandatory third-party insurance period for new vehicles by one year. Newly purchased cars will now require four years of third-party insurance instead of three, while new two-wheelers must carry six years of cover instead of five.

The directions came while hearing a motor accident compensation matter. The court observed that although the legal framework for compulsory third-party insurance exists, weak enforcement has left many accident victims struggling to receive timely compensation.

It said stricter implementation of insurance norms is essential to protect road users and reduce prolonged litigation.

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