So, you’ve joined the electric vehicle revolution in India! More people are driving clean, quiet EVs every day. But before you enjoy your new ride, you need one thing: insurance. Let’s talk about the basic EV third-party insurance that you must have by law. This motor policy is your legal shield on the road.
This guide is here to help you. We’ll show you how to get the government’s special 15% discount on your premium. You’ll also find the latest 2025 rates for your electric car insurance and understand exactly what this policy pays for if you’re in an accident.
What is EV Third-Party Insurance and Why Is It Legally Mandatory?
You might be asking, “What exactly is this basic insurance?” Think of EV third-party insurance as a safety net that protects you from legal and financial troubles involving other people. It’s the most basic motor policy you can get for your electric vehicle.
The Legal Mandate Under the Motor Vehicles Act, 1988
In India, a law called the Motor Vehicles Act of 1988 makes it compulsory for every vehicle owner to have this insurance. This means you cannot legally drive your new EV on public roads without a valid third-party liability policy. It is the minimum legal requirement to operate your vehicle.
What Third-Party Insurance Covers?
This policy isn’t for protecting your car; it’s for protecting you from costs related to others. Your insurance covers two main situations:
- Injury to a third party: If an accident involving your EV injures or causes the death of another person, your policy covers the legal and financial liability.
- Damage to third-party property: If your EV damages someone else’s property, like their vehicle or a building, the insurance pays for the repairs up to a certain limit.
What It Critically Does NOT Cover?
It’s very important to know what a third-party policy for your EV does not include. It offers no financial help for any damage to your own electric car. If your vehicle is stolen, damaged in an accident, or harmed by a natural disaster like a flood or fire, this policy will not pay for your losses or repairs. For that, you would need a different type of insurance policy.
Source: The information presented here is based on guidelines from automotive and insurance experts at sources like Shriram General Insurance, Digit Insurance, and Policybazaar.
How to Get the 15% Discount: IRDAI’s Official 2025 Premium Rates
You get a special price on your electric vehicle policy because the government wants to encourage more people to choose green transport. Let’s look at exactly how much you can save and what you’ll pay.
The Government’s Green Initiative: The 15% Discount Explained
To support the shift to cleaner vehicles, the Ministry of Road Transport and Highways (MoRTH) and the Insurance Regulatory and Development Authority of India (IRDAI) have introduced a great benefit. You get a flat 15% discount on the third-party insurance premium for your electric vehicle. If you own a hybrid electric vehicle, you still get a nice 7.5% discount.
This makes the mandatory motor policy a little lighter on your wallet.
2025 Third-Party Premiums for Private Electric Cars (Based on Power)
The cost of your third-party cover depends on your car’s power, which is measured in kilowatts (kW). Here are the official annual rates for 2025, including the long-term options for new cars.
| Power Output (kW) | 1-Year Third-Party Premium (₹) | 3-Year Third-Party Premium (₹) |
|---|---|---|
| Up to 30 kW | 1,789 | 5,543 |
| Exceeding 30 kW to 65 kW | 2,904 | 9,044 |
| Over 65 kW | 6,712 | 20,097 |
2025 Third-Party Premiums for Electric Two-Wheelers
For electric scooters and bikes, the premium is also based on power. The table below shows the yearly rates and the mandatory five-year premium for new two-wheelers.
| Power Output (kW) | 1-Year Third-Party Premium (₹) | 5-Year Third-Party Premium (₹) |
|---|---|---|
| Up to 3 kW | 457 | 2,466 |
| Exceeding 3 kW to 7 kW | 607 | 3,273 |
| Exceeding 7 kW to 16 kW | 1,161 | 6,260 |
| Over 16 kW | 2,383 | 12,849 |
A Note on Commercial EVs (e-Rickshaws, Goods Carriers)
This discount isn’t just for private vehicles. The rules also set specific third-party premiums for commercial electric vehicles. For vehicles like e-rickshaws or electric goods trucks, the premium is calculated based on factors like passenger capacity or the vehicle’s total weight.
Source: The premium rates and discount information presented here are based on the official notifications and draft proposals from the Insurance Regulatory and Development Authority of India (IRDAI) and the Ministry of Road Transport and Highways (MoRTH), as reported by trusted financial news platforms like The Economic Times and Business Standard and insurance aggregators like Policybazaar.
Third-Party vs. Comprehensive EV Insurance: Which is Right for You?
You know you need third-party insurance by law, but is it the best choice for your electric car? There’s another option called a full coverage car insurance policy. Deciding between them depends on how much protection you want for your vehicle.
A Head-to-Head Comparison
Let’s break down the main differences between these two types of electric vehicle policies. This table makes it easy to see what each one offers.
| Feature | Third-Party Liability Policy | Full Coverage Policy |
|---|---|---|
| Third-Party Bodily Injury | Covered | Covered |
| Third-Party Property Damage | Covered | Covered |
| Damage to Your Own EV | Not Covered | Covered |
| Theft of Your EV | Not Covered | Covered |
| Damage from Fire/Calamity | Not Covered | Covered |
| Battery-Specific Coverage | Not Available | Available as Add-on |
| Personal Accident Cover | Separate but Mandatory | Included/Mandatory |
| Premium Cost | Low | High |
Why Full Coverage Insurance is More Expensive for EVs?
You’ll notice the premium cost for a full coverage policy is much higher for an EV, and there are clear reasons for this. The main factor is the high cost of repairing or replacing an electric car.
EVs have advanced technology and expensive parts, especially their lithium-ion batteries, which can make up a large portion of the car’s total value. A battery replacement alone can cost anywhere from ₹2,00,000 to over ₹5,00,000, depending on your car model.
Also, fixing an EV requires specially trained technicians and specific tools, which increases labor costs. Because the repair costs are high, the insurance premium for a policy that covers your own damage is also higher.
Source: The information presented here is based on guidelines and data from automotive and insurance experts at sources like The Economic Times, Bajaj Allianz, Acko, and Progressive, as reflected in the cited sources.
How to Buy or Renew Your EV Third-Party Policy Online
Getting your mandatory EV motor policy online is very easy and takes just a few minutes. You can complete the entire process from your home without any paperwork. Here is a simple guide to help you buy or renew your electric car insurance.
Step 1: Visit an Insurer’s Website or an Insurance Aggregator
You can start by visiting the website of an insurance company like Tata AIG or Go Digit. Another option is to use an insurance comparison platform like Policybazaar or InsuranceDekho, which allows you to compare different policies at once.
Step 2: Enter Your EV Details
You will need to provide basic information about your electric car. Keep your vehicle’s registration number, make, model, variant, and its power rating in kilowatts (kW) handy to fill in the form.
Step 3: Select “Third-Party Liability” Cover
When you see the types of policies, you must choose the “Third-Party Liability” option. This is the basic plan that is required by law. If you only want the mandatory cover, be careful not to select a full coverage policy.
Step 4: Review the Premium
The website will calculate and show you the final premium. Check the price details to see that the 15% discount for electric vehicles has been applied to the base rate, lowering your cost.
Step 5: Complete Payment & Download Policy
After you confirm the details, you can pay the premium securely online using a debit card, credit card, or UPI. Once the payment is successful, your policy document will be sent to your registered email address instantly. You should download and save a copy.
Source: The process described here is based on the online purchase guidelines provided by insurance aggregators and companies like Policybazaar, Tata AIG, and InsuranceDekho, as reflected in the cited sources.
Beyond the Premium: Critical Information Every EV Owner Needs
Knowing your premium is just the start. Your electric car insurance has other important rules you need to follow. Understanding them helps you stay protected and avoid problems later on.
Don’t Forget the Compulsory Personal Accident (PA) Cover
Along with your third-party policy, you must also have a Personal Accident (PA) cover. This isn’t for the other person; it’s for you, the owner-driver. The law requires it. This cover gives you financial protection of up to ₹15 lakh if you suffer a permanent disability or in the unfortunate event of death from an accident while driving your EV. You must have a valid driving license for this cover to apply.
The Third-Party Claims Process: A Quick Guide
If you’re ever in an accident involving a third party, knowing what to do makes the claim process smoother. Here are the simple steps to follow for your EV insurance claim:
- Inform Your Insurer Immediately: Contact your insurance company as soon as possible after the accident. Delaying this can lead to your claim being denied.
- File an FIR: Go to the nearest police station and file a First Information Report (FIR). This is a very important document for your claim, especially if there are injuries or major damage.
- Submit the Documents: Give your insurer all the necessary papers. This usually includes the filled claim form, a copy of the FIR, your car’s Registration Certificate (RC), and your driving license.
Warning: How Unauthorized Modifications Can Void Your Insurance
Many people like to customize their cars. If you plan to modify your EV, you must tell your insurance company about the changes. This includes performance upgrades to the motor, changes to the battery pack, or adding large custom body parts.
If you make these changes without informing your insurer, they can reject your claim after an accident because the car’s risk profile has changed.
Source: The information presented here is based on guidelines from the Motor Vehicles Act and insurance experts at sources like Policybazaar, Acko, The Economic Times, and Shriram General Insurance.
Learn More with Finance Crave
Want to keep learning about motor insurance? Finance Crave is a great resource. You can find helpful blogs and articles on Auto and Car Insurance to keep you well-informed and confident in your choices.
Frequently Asked Questions (FAQs)
Is third-party insurance enough for my new EV?
It satisfies the legal requirement but offers no protection for your own vehicle. For new and expensive EVs, a comprehensive policy is highly recommended.
How is the EV third-party insurance premium calculated?
IRDAI sets the base premium based on the vehicle’s kilowatt (kW) power. A 15% discount is then applied to this rate for electric vehicles.
Can I get a third-party policy for more than one year?
Yes, for new private cars, a three-year third-party policy is available, and for new two-wheelers, a five-year policy is mandatory.
What happens if I drive without valid EV third-party insurance?
Driving without valid EV third-party insurance can lead to heavy fines, vehicle impoundment, and even imprisonment as per the Motor Vehicles Act.
Does the 15% discount apply to the comprehensive policy’s premium?
The 15% discount applies only to the third-party liability component of the premium, not to the Own Damage (OD) portion of a comprehensive policy.
Final Thoughts
Driving an electric vehicle is a smart choice for the future, and so is getting the right insurance. You now know everything about the mandatory third-party policy for your EV and how to get the 15% discount from the government. With this information, you can make a good decision that keeps you legally protected on the road while saving you money.
Ready to get your policy? Take a few minutes to compare quotes for your electric car insurance online and find the best rate for your ride. Drive with confidence and peace of mind.