The winter workshop at Bharat Mandapam on January 7-8, 2026 marks a rare moment when policy, politics and jurisprudence appear to converse in a common language. The Union Minister’s articulation of a behaviour-linked insurance regime and an expanded statutory third-party cover under Section 147 of the Motor Vehicles Act, 1988 is unquestionably a civilisational response to what the Supreme Court has described as a “social catastrophe” - a nation where nearly half the registered vehicles remain uninsured.

In National Insurance Company Ltd v. Smt Thungala Dhana Laxmi & Ors, decided on October 30, 2025 by a Division Bench of Justices Sanjay Karol and Prashant Kumar Mishra, the Court exposed the moral hollowness of a statutory mandate that exists largely on paper. By reminding the nation that 16.54 crore out of 30.48 crore vehicles roam uninsured, the Bench underscored that third-party rights are reduced to a cruel illusion when recovery itself is a mirage.

The Court’s insistence on reviving and nationalising the Gohar Mohammed protocol, its impleadment of the Ministry of Road Transport and Highways (MoRTH), the Insurance Regulatory and Development Authority of India (IRDAI), General Insurance Corporation of India (GIC) and the National Legal Services Authority (NALSA), and its call for a technology-driven enforcement architecture collectively constitute a judicial blueprint for systemic reform.

The proposal to empower enforcement authorities to seize uninsured motor vehicles and to impose stringent financial penalties relatable to the insurance premium payable is, in this backdrop, not merely welcome but indispensable. Deterrence is the only language that habitual non-compliance understands. If the certainty of seizure and the weight of financial consequence do not instill discipline on the road, no statutory idealism will. However, the success of this measure will lie not in its legislative articulation, but in its uncompromising execution. Laxity, selective enforcement or administrative indifference will reduce this powerful tool into yet another ornamental provision. In a system already suffering from enforcement fatigue, strict, visible and uniform application alone can ensure that this deterrent yields dividends. Without such discipline, even the most enlightened insurance reform will remain an academic exercise divorced from social reality.

Yet, reform in insurance law is a delicate choreography between compassion and coherence. The proposed statutory enlargement of Section 147 to include gratuitous occupants in private cars and pillion riders is a long-overdue homage to decades of judicial and academic discomfort, beginning with the Jai Prakash v. National Insurance Co Ltd line of cases. Parliament’s intention to convert what was once a contractual indulgence into a statutory right is both progressive and humane. But when the reform canvas extends further to include the owner or insured himself within the statutory third-party ambit, the law steps onto doctrinal quicksand.

The existing motor accident compensation regime is anchored in tort. Section 166 is not a statutory beneficence, but a procedural gateway to enforce a common-law right and negligence remains its moral and legal passport. An owner who injures himself by his own act cannot prosecute himself in tort. To promise him statutory insurance under Section 147 without dismantling the negligence requirement is to offer a bridge that leads nowhere.

It is precisely this paradox that yours truly had flagged of in a previous Bar & Bench column, when he described India’s motor insurance law as imprisoned within an indemnity-only mindset. Drawing from Asha Rani, Ningamma, Sadanand Mukhi and Ramkhiladi, it reminded us that the owner is a stranger to third-party status in his own vehicle. The Supreme Court’s nudge in Thungala Dhana Laxmi was not merely administrative; it was philosophical — a suggestion that the law must finally acknowledge that victims are defined by injury, not by ownership. The comparative invocation of the UK Road Traffic Act, 1988 is not romantic imitation, but practical wisdom: English law does not ask whether the injured person owned the vehicle; it asks only whether he was injured by its use.

The proposed draft amendment to Section 147, with its carefully crafted no-fault architecture for owners and authorised users, is therefore not a disruption but a doctrinal rescue operation. By deeming such persons to be third parties for a limited statutory purpose, exempting them from the tyranny of self-negligence and insulating insurers from recovery rights, the draft restores logical symmetry. It does not dilute the indemnity character of insurance, nor does it injure third-party rights, nor does it disturb Sections 164 (present avatar of 163A) or 166. It merely acknowledges that tort cannot heal a wound that tort itself refuses to recognise. The parallel amendment to Section 149 is equally indispensable, for without a corresponding enforcement obligation, statutory rights dissolve into rhetorical flourishes.

In Section 147 of the Motor Vehicles Act, 1988, after sub-section (1), insert the following proviso and sub-sections:

“Provided that compulsory insurance under this section shall, on payment of such additional premium as may be prescribed, extend to cover the death or bodily injury of the registered owner, or of any person driving the motor vehicle with the express or implied permission of the registered owner, arising out of the use of the motor vehicle, regardless of fault, and such registered owner or authorised person shall, for the limited purpose of this section, be deemed to be a third party.

(1A) A claim under the proviso to sub-section (1) shall not be defeated on the ground that the death or bodily injury of the registered owner, or of the person authorised to drive, was caused in whole or in part by the negligence of such person.

(1B) The compensation payable under the proviso to sub-section (1) may be without limit or subject to such minimum and maximum statutory limits as may be notified by the Central Government having regard to public interest and actuarial principles.

(1C) A claim under the proviso to sub-section (1) shall be on the principle of no-fault liability, and proof of negligence shall not be required.

(1D) Notwithstanding anything contained in this Act or any other law, the insurer shall have no right of recovery against the insured or his legal representatives in respect of any compensation paid under sub-sections (1A) to (1C).”

Explanation – For the purposes of this section, it shall not be a defence that the person suffering death or bodily injury was the registered owner or a person authorised by the registered owner to use or drive the motor vehicle, or that such person was wholly or partly at fault.

In Section 149(1), after the words “to the person entitled to the benefit of the decree,” insert:

“including claims arising under the proviso to sub-section (1) and under sub-sections (1A) to (1D) of Section 147.”

Equally important is the harmony with Section 164. A no-fault regime for owners and authorised drivers must coexist with, not collide against, the existing no-fault philosophy. Otherwise, the statute would speak in two contradictory tongues. The present personal accident cover under Section III of motor policies, offering modest fixed sums, cannot be the constitutional fig leaf for a welfare statute. IRDAI must recalibrate this contractual benefit as an additional layer, not a substitute for statutory justice.

The meeting at Delhi has thus opened a constitutional window. But windows, if carelessly cut, weaken the wall. If parliament amends Section 147 in isolation, ignoring its gravitational pull on Sections 164, 166 and 149, the result will be doctrinal turbulence and procedural chaos. The very reform intended to reduce litigation may fertilise it. In a jurisdiction already burdened with over four crore pending cases, motor accident claims vying for the highest share of pendency, law cannot afford ornamental reform.

The Supreme Court has lit the lamp. It has shown that uninsured vehicles are not merely regulatory failures, but moral failures. The executive has responded with intent. Now the legislature must respond with intelligence. Insurance reform cannot be an act of legislative enthusiasm alone; it must be an act of legislative memory — conscious of precedent, sensitive to structure and respectful of doctrinal balance. Only then will Section 147 evolve from a provision that protects strangers into one that protects citizens.

If the law must finally learn to recognise that sometimes the owner is also the victim, it must also learn to do so without tripping over its own logic. For in the end, statutory compassion without doctrinal clarity is not reform; it is merely another invitation to the courtroom. And We the People deserve better than a promise that arrives wrapped in litigation.

Narasimhan Vijayaraghavan is an advocate practicing before the Madras High Court.