[thezoid]

> you don't need special licenses or laws to enforce that. Just have a law that says "you must have insurance valid for the kind of driving you do"

Licenses provide the proper checks and balances proving that the driver has complied with their legal requirements. The license is typically shown somewhere in the taxi, so the fare can see that they are covered if anything bad were to happen.

That's of course assuming the fare knows about this, which for foreigners isn't always the case.