A recent disclosure by the government highlighted a significant gap in vehicle insurance coverage in India. Based on the data revealed by the Ministry of Road Transport and Highways, over 44 per cent of the vehicles operating on Indian roads do not have insurance cover. The data presented in the Rajya Sabha reveals a lack of compliance regarding mandatory third-party insurance requirements under the Motor Vehicle Act.
The revelation came in response to a Rajya Sabha question raised by K R Suresh Reddy on accident compensation for uninsured vehicles. Minister Nitin Jairam Gadkari confirmed the statistic is based on the VAHAN database listing active vehicles as of March 6, 2026. It also considers the registration and fitness status of the operation vehicles.
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This data hints at ongoing challenges in enforcing compulsory third-party insurance, mandated under Section 146 of the Motor Vehicles Act, 1988. While the Act requires all motor vehicles in public places to carry third-party insurance, with penalties outlined in Section 196, compliance remains uneven.
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The Ministry of Road Transport and Highways has issued multiple advisories to states and union territories, urging stricter enforcement and public awareness campaigns to improve the number. Furthermore, the government urges the adoption of technological tools like digital verification for better compliance. However, primary responsibility for implementation rests with state authorities.
The government also revealed that for victims of accidents involving uninsured vehicles, relief mechanisms exist. In hit-and-run cases where the offending vehicle is identified but uninsured, claims can be filed under Sections 164 or 166 of the MV Act, along with relevant Central Motor Vehicles Rules.
The Motor Vehicle Accident Fund, updated via rules in January 2026, includes dedicated accounts for uninsured vehicle incidents and hit-and-run compensation. These funds support treatment for accident victims not covered by insured vehicles and aid schemes like PM RAHAT under Section 162.