The central govt informed the Supreme Court (SC) that “40% of vehicles on the roads are uninsured”. This information came to light during the ongoing hearing of a writ petition, Civil No. 295 of 2012, filed by Agra-based senior advocate Kishan Chand Jain in 2023.
The govt stated that according to the e-Detailed Accident Report (e-DAR) data, only about 60% of vehicles involved in road accidents have third-party insurance. This means if an accident occurs with any of 40% uninsured vehicles, the victim cannot claim compensation from an insurance company but must pursue legal action against the vehicle owner to seek damages, a process that can be both difficult and problematic. Advocate Jain had filed a petition in the apex court for electronic monitoring of vehicles to ensure compliance with traffic rules as per section 136-A of the Motor Vehicles Act. He demanded e-cameras be used to check whether a vehicle has third-party insurance and to issue fines if it does not.
The ministry of transport has data indicating which vehicles are insured and the validity of insurance. “E-monitoring can easily facilitate the fines of uninsured vehicles,” Jain said.
He pointed out that under section 146 of MVA, it is mandatory for every vehicle to have third-party insurance. Failure to do so is punishable under section 196, resulting in imprisonment of up to three months or a fine of INR 2,000 for first offence, and for subsequent offences, imprisonment of three months or a fine of INR 5,000. Despite these provisions, vehicle owners continue to operate vehicles without third-party insurance. Notably, in financial year 2018-19, general insurance companies collected INR 38,046 crore in motor third-party insurance premiums, which increased to INR 49,508 crore in 2022-23 and is estimated to reach around INR 50,000 crore in 2023-24. Yet, 40% of vehicles are still running on the roads without insurance, the central govt told the SC.
The issue of uninsured vehicles was raised in the Lok Sabha as well. The finance minister, on March 20, 2023, responded to unstarred question no. 3211, revealed that excluding Madhya Pradesh, Andhra Pradesh and Lakshadweep, out of approximately 30.4 crore vehicles, 16.5 crore were “uninsured”.
The SC Road Safety Committee expressed concern over this matter, stating in its meeting on March 26, 2018, that 66% of vehicles are operating without third-party insurance, leading to a situation where heirs of dead accident victims are unable to receive compensation. The case is set for hearing on July 11.
