A tragic road accident case has thrown into focus a worrying legal loophole in India’s road accident compensation framework – what happens when a vehicle involved in a fatal accident has no third-party insurance and the responsible driver also dies or leaves no assets.
In the ongoing case before the Patiala House Courts, presided over by Justice Abhilash Malhotra, the court is probing the death of Surender Kumar Ahirwar, a cyclist who was killed in a collision with a car in Delhi in 2024. The car driven by Vishnu hit the cyclist and then hit a pillar. Both men died in the accident.
Ahirwar is survived by his wife and two minor children. Appearing in court, Vishnu’s elderly parents said they live in a jhuggi settlement and have not inherited any property from their late son.
Vehicle uninsured, without property
The car was uninsured at the time of the accident. The court previously ordered the auction of the 2014 vehicle, but the plaintiff’s attorney argued that the sale would not generate sufficient funds to meaningfully compensate the victim’s family.
Since the driver-cum-owner died in the same accident and left no assets from which compensation could be obtained, this essentially left the dependents of the victim with no clear path to relief.
The case assumes significance in the light of recent figures presented by the Ministry of Road Transport and Highways to the Lok Sabha. According to the ministry, there were 14,31,53,420 uninsured vehicles on Indian roads, compared to 17,54,37,351 insured vehicles based on Vahan 4.0 and Insurance Information Bureau of India records.
Based on the data, around 45% of the vehicles on Indian roads are uninsured while around 55% are insured. The largest share of uninsured vehicles falls into the category of two-wheelers.
Schemes do not apply
The court sought help from the New Delhi District Legal Services Authority (NDDLSA), which clarified that its compensation scheme applies only to cases where the offender is not traced. As the driver has been identified in this case, the matter does not fall within this framework.
The plaintiff’s counsel also pointed out that the case does not fall under the cashless treatment of road accident victims scheme of 2025 or the road accident victim compensation scheme of 2021.
Finding merit in these submissions, Justice Malhotra observed that: “There is a clear political vacuum and the family of the victim/cyclist cannot be left to fight their fate”.
The court, in its order passed on January 31, asked the Ministry of Road Transport and Highways (MORTH) to help it on whether any government scheme can cover such exceptional cases.
A wider national problem
Under Section 146 of the Motor Vehicles Act 1988, no vehicle may be driven in a public place without valid third party liability insurance. In the landmark case of S. Rajaseekaran vs Union of India, the Supreme Court in 2018 ordered that new cars must have three-year third-party insurance and two-wheeler five-year cover to curb the growing number of uninsured vehicles, leaving accident victims without compensation.
Speaking to The Hindu, Mr Gorang Goyal, Legal Aid Counsel with NDDLSA, who appeared for the plaintiff, said, “This case exposes a policy gap in India’s road accident compensation framework.”
He suggested that by extending the Motor Accident Fund to uninsured but identified cases where recovery is not possible, it would ensure that compensation would not depend on the financial situation of the person responsible.
“In this case, the deceased cyclist was the sole breadwinner, leaving behind a wife and two minor children. For this family, such compensation could fund the children’s education, basic living expenses and debt relief, thus preventing a lifetime of poverty after losing their only male breadwinner,” he added.
Published – 16 Feb 2026 17:22 IST