Valid 3rd Party Insurance is Now Mandatory for Public Transport Vehicles in Punjab

The Punjab Provincial Transport Authority (PPTA) in Pakistan has implemented a new requirement mandating valid third-party motor insurance for all public transport vehicles. This change was made by digitally linking motor third-party insurance with the vehicle route permit system, ensuring that any vehicle seeking a permit or renewal must display valid insurance coverage.

PPTA Secretary Hassan Ahsan announced that this move is a major step towards enhancing road safety, regulatory compliance, and public service delivery across Punjab. Developed in partnership with the Securities and Exchange Commission of Pakistan, the Central Depository Company, and the Insurance Association of Pakistan, the system is now fully functional and enables automatic checks on insurance compliance during the route permit process.

Under the new regulations, every public transport vehicle must possess valid third-party motor insurance to obtain or renew its route permit. This system aims to close regulatory loopholes, streamline compliance, and eliminate the need for manual verification. A notable aspect of the implementation is the real-time verification of insurance policies using the Central Depository Company's Motor Insurance Repository, which is expected to enhance transparency, curb fraudulent activities, and bolster enforcement measures while simplifying the processes for transporters.

The PPTA has also established a Command and Control Centre to oversee the system's operations, analyze data in real-time, and facilitate data-driven decision-making. By enforcing mandatory digital verification via the route permit system, the initiative aims to increase insurance coverage among the millions of vehicles registered in Pakistan, where insurance penetration is currently low.

This move is anticipated to not only enhance financial protection for passengers, drivers, and third parties but may also serve as a benchmark for insurance reforms in other provinces. Officials from the PPTA noted that the authority is considering additional measures to further strengthen enforcement and boost insurance penetration, underscoring the PPTA's commitment to leveraging technology in governance, promoting transparency, and ensuring public safety.