No insurance, no justice? – The cost of TGSRTC’s insurance exemption
The incident
In 2021, Srinivasa Rao, a manager at Shriram City Union Finance Ltd., was fatally struck by a speeding Telangana State Road Transport Corporation (TGSRTC) bus. He died on the spot.
In June 2025, nearly four years since the incident, the Motor Accident Claims Tribunal awarded his grieving family ₹53.57 lakh in compensation – but not without a legal battle.
Who Pays?
The Tribunal directed the TGSRTC Managing Director, Midhani Depot Manager, and the bus driver (who has since been dismissed) to pay the compensation jointly. It is expected this amount is to be paid out of their pockets.
But this raises a big question: why are TGSRTC buses uninsured?
Under Section 146(2) of the Motor Vehicles Act, 1988, State Road Transport Corporations (SRTCs) are exempt from the requirement to buy third-party motor insurance if they maintain an internal accident relief fund. This means they’re not legally required to insure their buses like private transport vehicles are.
Supreme Court is not convinced
In 2021, a Supreme Court bench composed of Justices Sanjay K Kaul and Hrishikesh Roy (who had been working for six months to improve the process of quickly disbursing compensation to victims and the injured by Motor Accident Claims Tribunals) called out this exemption, noting the disproportionate burden it places on victims of accidents involving government-run buses.
They highlighted:
- Delayed compensation due to SRTCs poor financial health
- Legal coercion often needed to enforce tribunal awards
- Injustice for victims who must wait years for relief
When SRTCs run losses (the TGSRTC incurred a loss of 929 crores in 2018-19 as per the Ministry of Road Transport and Highways) victims and their families face long waits, court battles, and emotional struggles. Unlike with insurance companies, who process claims promptly within defined timelines, SRTCs often take years to honour claims.
What can be done?
Make third-party motor insurance mandatory for all SRTC vehicles. This would:
- Ensure timely payouts to accident victims
- Reduce litigation burden on courts
- Ease the burden on the already loss-making SRTCs
insurancepe believes insurance is not just a compliance checkbox – it’s a promise of protection. No one should be denied compensation due to outdated laws or public sector loopholes. Insurance is not just about protecting vehicles, it’s about protecting lives.
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