Dorji Choden

Bhutan Construction and Transport Authority’s (BCTA) intensified enforcement of mandatory vehicle insurance has triggered heated discussions across social media platforms, reflecting mixed reactions among citizens.

In defence, an official from the BCTA said that the vehicle insurance was in existence since the Road safety and Transport Act 1999.

Section 50(1) of the Act mandates that all vehicle owners must have either comprehensive or third-party insurance to drive on public roads.

The law’s aim, the official said, was to ensure accountability, protect accident victims, and help vehicle owners handle financial risks in case of an accident.

The mandatory insurance laws are common worldwide, though specific requirements may vary from country to country, he added.

A vehicle owner, Ugyen, who has recently insured his car after five years, said that the assessment process was often illogical, adding that the insurance terms and conditions lack validity. “Instead of claiming insurance for accidents, we end up repairing the damage ourselves. For instance, if the damage involves rubber parts, we can’t claim insurance, even though we pay to cover the entire vehicle, not just specific parts.”

Another vehicle owner, Tshering, said that insuring a vehicle should be a personal choice.

“Unless there’s an incident, it offers no benefit to individuals and feels more like a donation to the insurance company,” he added.

Tshering said that the Authority doesn’t have a system to verify if a vehicle is insured or not. He, however, said that the inspection officer does not check properly, offer doma and officers renew the bluebook.

Rinzin said that it is important to have at least one type of insurance. “We never know when an accident might happen. However, it’s frustrating that insurance companies restrict repairs to their designated workshops, which discourages vehicle owners.”

In response to the public concern, the BCTA stated, “Initially, fines were imposed on uninsured vehicles during road inspections. Currently, insurance is verified during the vehicle renewal process, which has led some to mistakenly believe it is a new enforcement.”

While many consider the regulation outdated, an official from BCTA argues its importance, stating that the regulation remains relevant, especially given the increase in vehicles and associated risks.

“An increase in vehicles naturally leads to more accidents, regardless of road quality. The public perception that well-constructed roads will eliminate accidents is misplaced, as most incidents are caused by human error such as speeding, reckless driving, mobile phone use, and drunk driving rather than poor road conditions,” he said.

For commercial vehicles, such as buses and taxis, comprehensive insurance is required due to the higher risks associated with carrying passengers. For private vehicles, owners can choose between comprehensive and third-party insurance.

An official also said that the mandatory vehicle insurance aligns with international norms. Suppose, a vehicle is kept off the road, insurance isn’t required since it poses no risk.

However, vehicles on public roads can harm third parties or damage public property, and insurance ensures such costs are covered, he said.

BCTA also clarified its role in enforcing the regulation that unlike insurance companies, whose primary interest is business, BCTA’s focus is public safety and welfare. “It does not direct individuals to specific insurance providers but ensures that every vehicle is properly insured.”

The BCTA also shared that Bhutanese vehicles must be insured to drive on Indian roads.

The Authority emphasised the difference between life insurance and vehicle insurance. Life insurance is optional, vehicles are mobile assets that can cause accidents at any time, making their insurance essential, an official said.

To ensure compliance, BCTA verifies insurance certificates during renewal processes, as there is no system to track expired policies automatically.

BCTA said that their aim is not to penalise people but to familiarise the public with safety measures and regulations.

As of October 31st, Royal Insurance Corporation of Bhutan Limited has 42,000 active policies with a premium of 283 million.

Meanwhile, Bhutan Insurance Limited has 17,505 active policies as of November 30th.