If you get into an accident and the other driver doesn’t have a valid driver’s license, will the insurance company have to pay? This question is prevalent all across the world because driving without a license is a serious crime. But laws are different in different nations, and things could get much more complicated when new rules go into effect in 2025. This book talks about important countries like India, the US, the UK, Australia, Canada, Germany (in Europe), the UAE (in the Middle East), and the Philippines (in Asia). Each part has an explanation of liability, recommendations on how to avoid problems, and information on how to make a claim. Keep in mind that third-party coverage usually applies, but claims for damage to your own property may be denied. Always talk to a lawyer in your area.
India: Insurance Liability, Prevention, and Claim Process
Liability Without Licence: The Motor Vehicles Act of 1988 and its revisions in 2025 say that the insurance company is still responsible for claims made by third parties even if the driver doesn’t have a license. The Supreme Court has said that the corporation will pay first and then get the money back from the owner (the pay and recoup principle). But if the license is fraudulent and the owner knew it, the claim might not be accepted. IRDAI rules say that third-party coverage is required, although claims for damage to one’s own property might be denied.
How to Avoid (Prevention Tips): Always check that the driver has a valid license. You can add a loss of license add-on to your policy to cover the extra costs. When you renew your policy, tell the company about your driving history. Don’t use a false license, because the company can prove that you knew about it and deny your claim. Read the policy terms carefully and keep up with them.
How to Claim (Process): First, file a FIR with the police, and then tell the insurance company. Send in papers like an affidavit, a police report, pictures, and a loss of license add-on if you have one. The claim is processed by the corporation, which makes it easy for third parties. If your request is denied, you can file a complaint with IRDAI.
USA: State-Dependent Liability, Prevention, and Claim Process
Liability Without Licence: Driving without a license is against the law in the US, although state laws are different. If there is an exclusion clause, insurance companies may not pay claims. But because of restrictions about financial responsibility, third-party liability coverage usually applies. In 2025, California and other jurisdictions will need at least $30,000 in liability coverage per person and $60,000 per accident. Coverage for uninsured drivers is helpful. Federal rules say that a lack of a license can’t cancel the coverage, but victims can get their money back through the state DMV.
How to Avoid (Prevention Tips): Maintain a valid licence; opt for non-owner policies if without one. Choose high-risk insurance for specialised coverage, and disclose all details in the policy. Complete driving courses to reduce rates.
How to Claim (Process): File a police report, inform the insurance company. Submit documents like accident details, photos, and uninsured coverage if applicable. If denied, seek legal help as state DMV may assist in recovery.
UK: Strict Laws, Prevention, and Claim Process
Liability Without Licence: Under the Road Traffic Act 1988, no licence invalidates insurance, allowing the company to reject claims. However, the Motor Insurers’ Bureau (MIB) compensates third-party victims. In 2025, special rules apply for foreign licence holders; non-UK residents must meet licence requirements.
How to Avoid (Prevention Tips): Exchange foreign licences for UK ones; verify licence details in the policy. Compare insurance for non-UK holders, and use driving courses to lower premiums.
How to Claim (Process): Report to the police, inform the insurance company or MIB. Submit documents such as accident details, photos, and claim form. If uninsured, MIB handles it.
Australia: Potential Denial, Prevention, and Claim Process
Liability Without Licence: Variations by state; no licence may void insurance, but Compulsory Third Party (CTP) covers third-party injuries. In 2025, Indian DL is valid for 3 months, but no licence leads to full denial. High Court rulings emphasise driver responsibility.
How to Avoid (Prevention Tips): Renew licences promptly; avoid unlicensed driving as vehicles may be impounded. Check policy exclusions and maintain CTP coverage.
How to Claim (Process): File a police report, inform the insurance company. Submit documents like photos, report, and claim form. If unlicensed, claim compensation through CTP.
Canada: Provincial Variations, Prevention, and Claim Process
Liability Without Licence: Under the Highway Traffic Act, no licence breaches the policy; claims may be denied. However, third-party coverage applies. In 2025, provinces like Ontario impose fines and demerit points. Uninsured automobile coverage assists.
How to Avoid (Prevention Tips): Maintain valid licences; check reciprocal agreements for international drivers. Opt for high-risk policies and disclose policy details.
How to Claim (Process): File a police report, inform the insurance company. Submit documents like policy number, accident details, and medical reports. If denied, complain to the provincial regulator.
Germany: EU Directives, Prevention, and Claim Process
Liability Without Licence: EU directives render insurance invalid without a licence, but third-party protection applies. In 2025, third-party liability is mandatory for car registration.
How to Avoid (Prevention Tips): Require International Driving Permits; use no-claims bonus systems to reduce premiums. Maintain owner insurance.
How to Claim (Process): Report to the police, inform the insurance company. Submit documents like police report, photos, and claim form.
UAE: Strict Fines, Prevention, and Claim Process
Liability Without Licence: Strict rules; companies deny claims without a licence. In 2025, third-party liability minimum is AED 500,000. Unlicensed drivers cannot receive compensation.
How to Avoid (Prevention Tips): Maintain valid licences; avoid unlicensed driving as fines reach AED 500 with impoundment. Check policy exclusions.
How to Claim (Process): Report to police on 999, inform the insurance company. Submit documents like police report, photos, and claim form.
Philippines: Pay and Recover, Prevention, and Claim Process
Liability Without Licence: Similar to India; the company is liable but can recover. In 2025, unlicensed drivers are liable, but third-party claims are covered.
How to Avoid (Prevention Tips): Follow valid licences and restrictions; disclose policy details. Avoid unauthorised repairs.
How to Claim (Process): File a police report, inform the insurance company. Submit documents like affidavit, photos, and claim form. File within 6 months.
Conclusion: Stay Informed and Safe
Globally, no licence increases insurance issues, but third-party protection is often available. For prevention, maintain valid licences, and documentation is key for claims. Check local laws and seek expert advice.
