mumbai only a third of the vehicles in india were insured in 200910 according to an information bureau set up by the regulatorof the 12 crore automobiles and twowheelers on indian roads less than four crore vehicles had any type of insurance cover in 200910 according to data available with the insurance information bureau iib which was set up by the insurance regulatory development authority irda in 2009 to provide data to researchers and policy makers customers do not renew their car policy this is partly because the value of the vehicle comes down said icici lombard motor insurance head sanjay dattavehicle insurance has two components own damage cover which is triggered when the vehicle is damaged in an accident and thirdparty liability which covers any injury or damage caused to another person or vehicledriving an uninsured vehicle is prohibited under the motor vehicles act 1988 violation is punishable with imprisonment for three months or a fine of rs 1000 or both datta said there should be fine mechanism to enforce thirdparty insurance covers adding that vehicle owners generally do not renew policies after five years new vehicles do not go without a cover about 34 yearold vehicles are insured but as they get older people stop renewing the policy penalty is not serious whereas if you are caught without one in a foreign country there is a chance of losing ones licence said gautam modi a dealer at fordthe claim ratio in the owndamage segment is significantly lower compared to thirdparty covers although thirdparty insurance is mandatory in india 40 of vehicles on road did not have this cover in the year under reviewincurred claim ratio in the thirdparty segment was nearly 98 at4380 crore for the owndamage segment it was 55the insurance regulator has recently increased provisioning towards the thirdparty motor pool following which companies have infused capital to boost their solvency margina senior executive of oriental insurance company said insurance is a must for registering vehicles so no vehicle is sold without insurance things are compulsory but not enforced incurred claim ratio is the claims paid during the year plus closing provision at the end of the year and is expressed as a percentage to the premium