Wednesday May 27, 2026
Wednesday May 27, 2026
Tuesday, 26 May 2026 01:30 - - {{hitsCtrl.values.hits}}
IRCSL Chairman Dr. Ajith Ravindra De Mel, IRCSL Director-General Damayanthi Fernando, IASL General Insurance Forum Chairman Dinusha Thilanka, Sri Lanka Police Traffic Control and Road Safety DIG W.P.J. Senadheera
The Insurance Regulatory Commission of Sri Lanka (IRCSL) yesterday unveiled an ambitious roadmap to double the country’s current insurance penetration level of 1.1% by 2030, while bringing an estimated 2.8 million uninsured vehicles into the formal insurance system through a new digital motor insurance initiative.
Speaking at a special media briefing at the Department of Government Information to raise awareness on the newly introduced digital insurance card system, IRCSL Chairman Dr. Ajith Ravindra De Mel said the insurance industry’s long-term strategy is centred on seven key pillars aimed at expanding market size and increasing the sector’s contribution to the economy.
He said a major component of that roadmap is the digitisation of motor insurance cards, which officially came into effect from 1 May 2026. The initiative was jointly introduced by the IRCSL, the Insurance Association of Sri Lanka and all 14 general insurance companies operating in the country.
The Chairman said the aim is to double the insurance market size by 2030 and triple it by 2035.
“Sri Lanka has 8.8 million vehicles registered with the Department of Motor Traffic, but only about 6 million are insured. There’s 2.8 million that are uninsured,” Dr. De Mel said.
He explained that many of the uninsured vehicles include those deemed not roadworthy, vehicles seized by leasing companies and vehicles owned by State institutions.
“Several State-owned institutions run vehicles without insurance,” he noted.
Under the new system, vehicle owners are now issued a digital insurance card containing a QR code instead of the traditional printed insurance certificate. Policyholders receive a link upon registration, while the Police have been equipped with a digital verification platform to instantly validate insurance coverage.
Dr. De Mel said the digital system addresses longstanding industry issues linked to outdated physical insurance cards.
He noted that under the previous system, motorists were often allowed a 60-day period to settle premium payments, during which invalid physical cards could still be used. “We give 60 days for payment to be made, and if it hasn’t been made, the Police cannot see this with a plastic card. This was a discipline issue with people using a card that was not valid. This meant a large amount of money due to the industry not coming in,” he said.
He added that the real-time updating feature of the digital platform also benefits consumers by reducing disputes where claims were rejected due to delayed payment confirmations between customers and insurance companies.
Policyholders can now independently verify whether their insurance policy remains active at any given time.
Dr. De Mel said the move would also significantly reduce plastic waste and lower the cost associated with producing nearly six million physical insurance cards annually.
He also revealed that a national motor vehicle insurance database, referred to as an “Insurance Crib,” has also been established under the initiative.
Dr. De Mel said the Commission is also exploring future integration between the insurance sector and the healthcare system to help reduce healthcare-related fiscal burdens.
“Healthcare receives the second-largest allocation in the national Budget,” he said, confirming that discussions are underway with the Health Ministry to integrate the insurance industry similar to what most developed countries have done.
Responding to questions on whether insurance companies currently contribute financially toward treatment costs incurred by State hospitals for road accident victims, Dr. De Mel acknowledged that no such mechanism exists at present, although he described it as a worthwhile proposal for future consideration.
IRCSL Director-General Damayanthi Fernando elaborated on the Optional Compensation Scheme for third-party victims of motor vehicle accidents, which came into operation from 1 March 2024.
“The scheme provides an alternative mechanism for third-party victims or their legal heirs to obtain compensation outside the Court system, without affecting their legal right to pursue further compensation through litigation,” she added.
Fernando clarified that victims who receive compensation under the optional scheme can still pursue additional compensation through Courts if they consider the amount insufficient. Eligible beneficiaries include individuals who die or suffer permanent disability due to motor vehicle accidents.
She said the compensation limit under the scheme has been increased from Rs. 500,000 to Rs. 1 million.
“To qualify, the vehicle involved must possess at least third-party insurance coverage, while death or permanent disability must occur within 12 months of the accident. Applications for compensation must also be submitted within six months from the date of death or disability,” she said.
According to her, around Rs. 50 million has already been disbursed under the Optional Compensation Scheme, although public awareness of the facility remains low.
Insurance Association of Sri Lanka (IASL) General Insurance Forum Chair Dinusha Thilanka said the long-term objective is to digitise all insurance-related documentation.
“Motorists will be able to access digital insurance cards through mobile phones, web interface and QR codes, while the authenticity of policies can be verified at any time via the dedicated toll-free hotline 1338,” he elaborated.
Under the USSD system, users can dial *1338# and verify insurance details using either the vehicle number or policy number. Similar verification can also be obtained by sending the relevant details via SMS to 1338. The IVR facility allows users to directly connect with their insurance company’s call centre after selecting the insurer through an automated menu system.
Thilanka said the verification hotline will operate 24 hours a day throughout the year to ensure uninterrupted public access to insurance verification services.
Sri Lanka Police Traffic Control and Road Safety Deputy Inspector General W.P.J. Senadheera said the Inspector General of Police has already issued operational directives to 608 Police stations islandwide to support implementation of the new digital insurance system.
Alongside the digital card rollout, authorities have also introduced a National Insurance Verification System enabling the public and law enforcement officers to instantly verify insurance validity through USSD, SMS and IVR services.
“The move enables Traffic Police officers to instantly verify the accuracy of a motor vehicle’s insurance policy validity. The SMS service provides a particularly convenient method for obtaining this information,” Senadheera said.
He explained that while motorists are no longer required to carry printed insurance documents for routine verification purposes, physical or printed copies may still be required during accident investigations.
DIG Senadheera also noted that under the Electronic Transactions Act No. 19 of 2006, digital motor insurance cards possess the same legal validity and enforceability as printed documents.
