Alert! No car insurance without valid PUC certificate, says IRDA

The Insurance Regulatory and Development Authority of India (IRDAI) has asked insurance companies not to insure a vehicle unless it has a valid pollution under control (PUC) certificate. As per the notification, vehicle owners will have to present a valid PUC certificate at the time of renewing the insurance.  As per the law, no vehicle is allowed to ply without having third-party insurance, a rule which is largely flouted due to poor enforcement. 

Challenges for the Private Insurance companies 
Implementation of the rule is going to be a difficult task for the insurance companies as the PUC norm differs in every state. In addition, several associated challenges will be faced by the insurance companies while implementing the directions of the insurance regulators like ensuring the authenticity of the certificate that is produced by the applicants. 

There is no centralised data on PUC in the country and its absence will turn out to be a challenge for the insurance companies that are selling digital insurance. They will have to face the heat while checking the authenticity of the PUC certificates deposited by the vehicle owner while renewing their insurance. This means they will have to develop both online and offline systems to renew the insurance. 

However, public insurance companies will get the benefit of the direction due to the presence of their offices, micro-offices and agents across India.  IRDA's decision is based on the Supreme Court August 2017 decision in which the court said the insurance companies will not insure a vehicle unless it has a valid PUC certificate on the date of the renewal of the policy.