More than half the vehicles on the road in India are running without any insurance cover – a mandatory provision under the Motor Vehicles Act.
Nearly 57 per cent of the total vehicles on the road were uninsured as of March 2019, up from 54 per cent in March 2018, according to the Insurance Information Bureau of India’s annual report released on December 7.
The bulk of uninsured vehicles are two-wheelers, with the numbers being as high as 66 per cent. “There were 15 states which had uninsured vehicles to the extent of more than 60 per cent,” said the report. In most cases, the renewals are not done after the first year.
India is one of the largest auto markets in the world with over 20 million vehicles sold annually. It is also among the countries with the highest number of road accidents and fatalities. “In this grim scenario, it is a double whammy when more than half the vehicles in the country are uninsured,” IIB said.
According to IIB, of the over 23.12 crore vehicles on the road in India as of March 31, 2019, nearly 57 per cent were uninsured; in 2017-18, 54 per cent of the nearly 21.11 crore vehicles on the road were uninsured.
“The uninsured vehicles largely comprise two-wheelers, and this is quite obvious as nearly 75 per cent of the total vehicles in India consist of two-wheelers. In this class, over 60 per cent of the vehicles remain uninsured, whereas cars are largely insured, with the uninsured numbers quite low at around 10 per cent,” the report said.
About 52 per cent vehicles don’t renew their insurance after the first year – mostly two-wheelers fall out of the insurance net at the time of the first renewal of the insurance policy.
According to the Motor Vehicles Act, 2019, it is mandatory for all vehicles to be insured with third-party vehicle insurance policy. Third-party or liability insurance covers the legal liability arising due to death or disability of third party loss or damage to their property.
“When an uninsured vehicle meets with an accident, the injured or relatives of dead people don’t get any compensation. There is no compensation for damaged vehicles,” said an official.
