Major changes in vehicle insurance rules, new rule will be implemented from 15 December

According to a report by Indian Express Gujarati, major changes have been made in vehicle insurance rules by the Insurance Regulatory and Development Authority of India, known as IRDAI, which will come into effect from the upcoming 15 December 2026. According to these new rules, while selling vehicle insurance, insurance companies will have to clearly state in writing to customers which facilities are being provided under the insurance policy.

Following the order given by the Supreme Court, now two-wheeler or car drivers will have to compulsorily take a personal accident insurance policy while purchasing motor vehicle insurance. A circular has been issued by IRDAI to implement this decision, which will become effective from 15 December 2026. According to these new rules, taking an accident insurance policy for pillion riders sitting behind in two-wheeler vehicles like bikes and scooters, or other car passengers, has been kept optional.

Under these new rules, the third-party insurance policy has been kept compulsory. However, in circumstances where a motorcycle or car meets with an accident or the vehicle is lost, taking the insurance policy will remain optional. Insurance companies will have to clearly provide information to customers as to how much charge they are collecting for the insurance of every item.

From the upcoming 15 December, companies selling motor vehicle insurance will have to sell insurance policies under a new framework and link it to IRDAI's 'Bima Sugam' portal, so that customers purchasing insurance can obtain complete information as per the new circular. All other coverages related to motor insurance have been kept optional.

If any vehicle owner currently has third-party coverage and they want to take additional coverage, they will not need to cancel their ongoing vehicle insurance policy. For additional insurance coverage, they can add it to their insurance coverage by paying an extra charge. Furthermore, along with third-party insurance, the customer can also take cover for legal services after an accident, for which a separate charge will have to be paid.

Currently, while making a policy purchase, motor vehicle insurance companies show that the car or motorcycle driver has taken a separate accident insurance policy, and this cannot be bundled with the motor vehicle insurance policy in this manner. While purchasing a car insurance policy, the customer knows in advance how much insurance benefit they will get if their vehicle meets with an accident or is stolen.