Govt proposes to make FASTags mandatory to avail third party insurance

Not having a FASTag can become a penal offence under CMVR. Additionally, four-wheelers without one will be challaned for non-compliance

The Union Road Transport and Highways Ministry has forwarded a proposal to make FASTags mandatory for all four wheelers starting January 1, 2021. The recommendation comes amid the Central Government’s belligerent drive to push the adoption of digital payments at toll plazas across national highways to reduce traffic and cut down travel times. A valid FASTag may also be compulsory to avail new third party insurance.

What is the proposal?

FASTag has been made mandatory for all new vehicles registered since 2017. The tag is supplied either by the manufacturer or the dealership. The proposal now seeks to extend the compliance for old four wheelers sold before December 1, 2017. To bring in the changes, the government will have to make an amendment to the Central Motor Vehicle Rules (CMVR), 1989. The changes will be applicable to M and N categories of vehicles that are manufactured for the carriage of passengers and goods respectively.

“All existing four wheelers will need to have FASTag. It will be a penal offence under CMVR. One can be challaned for that,” a senior transport official has explained.

Related: Claiming compensation under third-party motor insurance 

What else is proposed?

A valid FASTag may also be compulsory to avail new third party insurance through an amendment in FORM 51 (certificate of Insurance). This means that car owners can be denied third party insurance in the absence of a FASTag. Details of the FASTag ID will be captured at the time of purchase of insurance. This proposal may come into effect from April 1, 2021.

Earlier in August this year, the Transport Ministry made it mandatory to have a FASTag in order to avail discounts on toll charges, like that on a return journey within 24 hours. It is also necessary to have a FASTag to renew fitness certificate of vehicles with a national permit since October 1, 2019.

The Transport Ministry has tabled a draft report on September 1, 2020, to seek comments and suggestions from the stakeholders.  Read this to know everything about Third Party Liability in car insurance