IL Postcard

Got Auto Insurance? New Law Comes Into Effect Today

Date: 02/28/2007

A new transit system law regulating auto insurance comes into effect today. Every car in Panama must be covered by basic auto insurance. The basic insurance must include third-party liability (up to at least $5,000), and injury and accident coverage (up to at least $10,000) in order to qualify as acceptable.

Up until yesterday, the authorities had not yet determined how non-compliant drivers will be sanctioned. They met with representatives from the insurance sector, however, and today announced that uninsured vehicles will not be eligible for the required yearly revisado (full check and tune-up). In Panama, every vehicle must have a valid revisado sticker in order to circulate.

The new law also includes provisos on drunk driving, reckless driving, auto maintenance, and "reckless walking" on the part of pedestrians. New fines and penalties have been established for violators of these norms; at $1,500, the new drunk-driving penalty is the highest. The other fines vary from $20 to $375. In addition, violators will accumulate points, and anyone reaching 35 points in a 12-month period will lose their license for a year - in addition to being fined and/or sanctioned, depending on the violation.

The transportation unions protested the new law rigorously all last year-there was even a protest yesterday. However, the government has remained firm, promising to review the unions' petitions, but warning that the new law will neither be changed nor revoked.

The transit system is one of the few things that make life unpleasant in congested areas in Panama. We all hope that this new law will greatly improve conditions for drivers and pedestrians alike. A good summary of the regulation can be found, in Spanish, at the Government Ministry site.

Best Regards,

Brandon Clogston
International Living / Panama

P.S. Check out Panama and evaluate the quality of life for yourself. We hope you'll join us for our upcoming Panama Real Estate Tour, March 25-27, 2007, with an optional Boquete tour March 28-29.