To legally operate commercial vehicles in India, there are several rules that owners must follow, including having a valid PUC certificate, special permissions, and commercial vehicle insurance, among others. Under the Motor Vehicles Act, 1988, commercial vehicles must have at least a third-party insurance plan, as it covers the vehicle against any third-party liabilities.

If you are a commercial vehicle owner, it is crucial for you to know the importance of third-party commercial vehicle insurance, its coverage scope and other crucial details.

Keep scrolling to learn more about mandatory commercial vehicle insurance in India!

What are the Mandatory Insurance Requirements for Commercial Vehicles in India?

The mandatory insurance requirements for commercial vehicles operating in India are as follows:

Third-party Commercial Vehicle Insurance

Nearly 27,000 people in India lost their lives in road accidents on national highways during the first half of 2025. Accidents are a major cause of death in India, but the parties involved in the accident do not take responsibility for their actions.

Third-party commercial vehicle insurance ensures that the third-party individuals, property, and vehicles involved in the accident get coverage. Moreover, it enables the commercial vehicle owner to get coverage to pay for the accidental damage to third parties, thus reducing their financial losses.

Apart from this, third-party insurance for commercial vehicles is mandatory in India. Non-compliance with the Motor Vehicles Act can lead to heavy penalties or confiscation of the vehicle.

Comprehensive Commercial Vehicle Insurance

Although a third-party commercial vehicle cover is mandatory, owners also have the option to choose comprehensive commercial vehicle insurance policies. It covers your vehicle comprehensively, not only from third-party liabilities but also for other uncertainties, which include:

  • Damage caused by riots and natural calamities, such as floods, fire, earthquakes, cyclones, and more.
  • Damage caused by fire, explosion, or self-ignition.
  • Partial or complete damage caused to the commercial vehicle due to theft, burglary, or housebreaking.
  • Damage caused by road accidents or collisions.

Compulsory Personal Accident (CPA) Cover

It is a standalone personal accident insurance cover that safeguards the owner-driver of the vehicle against accidental death or disability while driving the insured vehicle. According to the IRDAI, it is compulsory for all vehicle owners to have a personal accident cover with a minimum ₹15 lakh sum insured.

Buying a standalone CPA cover is ideal when your truck insurance plan does not include personal accident coverage or your business has multiple vehicles.

Whether you opt for a mandatory third-party commercial vehicle insurance plan or an optional comprehensive one, it is crucial to ensure that your vehicle always has active cover. To do so, you can periodically track the policy expiry date using digital apps and also ensure you pay premiums on time for continuous coverage.

By following these simple tips, you can always ensure compliance with the law while gaining access to coverage in case your commercial vehicle gets involved in an unfortunate accident.