Rohit booked a mid-size SUV last month with an assistance pack the salesperson spent ten minutes demonstrating. Adaptive cruise control, lane-keep assist, automatic emergency braking.
Now his insurance renewal is due and he is wondering whether a car carrying cameras and radar needs something different from the policy he had on his old hatchback.
A car with self-driving or driver-assistance features is insured in India under an ordinary comprehensive motor policy, because no dedicated autonomous vehicle insurance product exists in the Indian market yet. Fully autonomous cars are not sold here. What is sold, in large and growing numbers, is a generation of cars that assist the driver without replacing them. This article covers how those cars are insured today and what is likely to change.
What are self-driving cars and autonomous vehicles?
Cars sold in India today reach Level 2 automation at most, which means the driver remains in charge at all times, both legally and practically.
The Society of Automotive Engineers (SAE International) grades driving automation on a six-point scale from Level 0 to Level 5. Each step upward reduces how much the human driver has to do.
Table: Levels of driving automation and what is available in India
Level | What the car does | Example | Available in India |
|---|---|---|---|
Level 0 | No automation. The driver controls steering, braking and acceleration. | Most older hatchbacks and sedans | Yes, the bulk of the fleet |
Level 1 | One assistance function operates at a time. | Adaptive cruise control | Yes, widely |
Level 2 | Steering and speed are managed together. The driver must supervise continuously. | Lane centring combined with adaptive cruise control | Yes, on many mid-size and premium models |
Level 3 | The car drives itself in defined conditions. The driver must be ready to take over when prompted. | Traffic-jam pilot on limited-access highways | Not sold to private buyers |
Level 4 | The car drives itself in most conditions within a mapped area. | Robotaxi services operating overseas | No |
Level 5 | Full automation everywhere, with no driver needed. | None in commercial production anywhere | No |
The term used in the Indian market for Level 1 and Level 2 features is ADAS or Advanced Driver Assistance Systems. If your car brochure lists lane departure warning, blind spot monitoring or automatic emergency braking, that is ADAS. It is what manufacturers here are selling.
On the levels above that, the government's position has been stated plainly. The Ministry of Road Transport and Highways has said repeatedly that driverless vehicles will not be permitted on Indian roads, citing the effect on driver employment. That position could change. As of now it has not.
How do self-driving and autonomous cars work?
An automated car replaces the driver's eyes and judgement with five working parts: sensors, positioning, processing, control and connectivity.
Sensors do the seeing. Cameras read lane markings, road signs and traffic lights. Radar measures the distance and closing speed of vehicles ahead.
LiDAR, which stands for Light Detection and Ranging, builds a three-dimensional map of the surroundings using pulsed laser light. Ultrasonic sensors handle close-range work such as parking.
GPS and high-definition mapping tell the car where it is, usually to within a few centimetres rather than the few metres a phone manages.
Artificial intelligence takes the sensor feed and decides what to do with it, which is the part that separates a Level 2 car from a Level 4 one. Control systems then execute that decision through the steering, throttle and brakes.
Connectivity ties it together. Over-the-air software updates, telematics and vehicle-to-everything communication keep the system current and, in more advanced setups, let the car exchange information with infrastructure and other vehicles.
Every one of those components is a part that can be damaged and that is where insurance enters.
What is autonomous vehicle insurance?
Autonomous vehicle insurance describes a category of cover being designed internationally for cars that drive themselves, rather than a product an Indian buyer can purchase today.
This distinction matters because it changes what you should do. In India, a car with ADAS is insured under the same three options as any other private car:
Third-party cover, which is mandatory under Section 146 of the Motor Vehicles Act, 1988 and pays for injury, death or property damage your vehicle causes to someone else.
Standalone own damage cover, available for cars new and old since 1 September 2019, which covers damage to your own vehicle and can be bought only where third-party cover is already in force or is taken at the same time.
Comprehensive cover, which combines both in one policy.
Factory-fitted ADAS hardware sits inside your vehicle's Insured Declared Value (IDV) rather than being declared separately, because it forms part of the car's listed price. Anything retrofitted afterwards, such as an aftermarket dashcam or parking sensor kit, should be declared to your insurer.
As genuinely autonomous vehicles reach the market, cover will need to stretch into areas standard motor policies do not currently reach.
Table: What dedicated autonomous vehicle cover would need to address
Cover need | What it would address | Position in India today |
|---|---|---|
Technology component cover | Replacement of LiDAR units, radar modules and camera arrays | Damage in an insured event is covered as own damage, subject to depreciation and policy terms |
Software failure cover | Loss caused by a fault in the driving software | Not covered; software and electrical faults sit outside standard motor wordings |
Cybersecurity protection | Loss following unauthorised access to vehicle systems | Not part of a standard motor policy |
Product liability | Compensation where the manufacturer or software provider is at fault | No provision under the Motor Vehicles Act, 1988 |
Data and evidence access | Rights over sensor and event logs after a crash | Being shaped by emerging standards; not settled |
Where a component fails on its own rather than being damaged, the manufacturer's warranty is your route, not your motor policy.
Factors influencing the premium of autonomous vehicle insurance
A car with ADAS usually costs more to insure in India than the same car without it, because the technology raises both the insured value and the cost of putting the car right after a claim.
This surprises people who expect safety features to earn a discount. Rohit found his renewal quote higher than the one on his old hatchback, despite buying the safer car. Seven factors drive it.
Insured Declared Value. ADAS hardware raises the ex-showroom price, which raises IDV, which raises own damage premium. Premium is calculated on insured value, so a better-equipped variant costs more to cover.
Parts cost. A windscreen carrying a camera mount costs considerably more to replace than a plain one. The same applies to a bumper housing radar sensors.
Calibration labour. Sensors need recalibrating after routine bodywork so they read the road correctly again. That is labour a conventional bumper repair never required.
Repair network depth. Fewer workshops are equipped for sensor calibration, which can mean longer tows and higher labour rates.
Claims history and No Claim Bonus. This works exactly as it always has. Five consecutive claim-free years can earn a discount of up to 50% on the own damage portion.
Usage. IRDAI has permitted usage-based add-ons such as Pay As You Drive and Pay How You Drive, which price premium against actual distance covered or driving behaviour rather than a flat annual assumption.
Accident frequency. Assistance systems do reduce collisions. That benefit shows up in fewer claims over time rather than as a line-item ADAS discount on your quote today.
Challenges and opportunities in insuring autonomous vehicles
The difficulty is not whether autonomous cars can be insured, but who pays and on what evidence and both questions are unresolved.
Challenges
Establishing fault. When a car drives itself, an accident may trace back to the manufacturer, the software developer, a sensor supplier or a mapping data provider. Determining which of them is responsible is considerably harder than establishing whether a driver was speeding.
No regulatory framework. The Motor Vehicles Act, 1988 treats autonomous vehicles no differently from any other vehicle and IRDAI has issued no product guidelines specific to them. Until that changes, insurers are working without a rulebook.
Cybersecurity exposure. A connected car is reachable and anything reachable can be attacked. Risks run from data theft to interference with safety systems.
Access to vehicle data. After a conventional accident you submit photographs, witness statements and a damage report. With an automated vehicle, the most useful evidence sits in sensor and software logs held by the manufacturer, who is under no clear obligation to release it. The Digital Personal Data Protection Act, 2023 governs personal data including telematics and location information, which adds a second layer of consideration to who may see what.
Repair cost inflation. Replacing sensor arrays and recalibrating them costs more than repairing sheet metal, so each claim runs higher even when claims become rarer.
Opportunities
New product categories. Cover for software faults, sensor failure and cyber intrusion does not exist as a motor product today, which leaves clear room for insurers to build it.
Fewer accidents. Most crashes trace back to human error. Removing speeding, distraction, fatigue and impaired driving from the equation should reduce both frequency and severity over time.
Better evidence. An automated car records what happened. Where insurers gain access to that record, claim decisions can be made faster and with more certainty than witness accounts allow.
Partnerships with manufacturers. Insurance is currently sold separately from the vehicle. As automation advances, cover bundled with the car by the manufacturer becomes a plausible model and it would solve the data access problem at the same time.
Car insurance premium calculation for autonomous vehicles
Premiums for genuinely autonomous vehicles are expected to be higher at first while the risk is unfamiliar, then fall as evidence accumulates that automation reduces accidents.
The strongest evidence available so far comes from insurance claims rather than crash reports.
Swiss Re analysed liability claims arising from 25.3 million fully autonomous miles driven by Waymo in the United States, benchmarked against human-driver data covering more than 500,000 claims and over 200 billion miles of exposure. The autonomous fleet recorded an 88% reduction in property damage claims and a 92% reduction in bodily injury claims.
Measured against newer 2018 to 2021 vehicles already fitted with ADAS, the reductions were 86% and 90%.
Read that alongside the repair cost problem and a pattern appears. Claims become rarer and each one becomes more expensive. What an insurer prices is the product of those two movements, not either alone.
For Indian buyers there is no meaningful premium calculation for an autonomous vehicle yet, because no such vehicle is on sale. What can be calculated is the premium on the ADAS-equipped car you can buy and that follows the ordinary method: IDV, cubic capacity, geographical zone, age of vehicle, claims history and chosen add-ons.
Regulation is arriving ahead of the vehicles. ARAI published two standards in April 2024: AIS-189, covering cybersecurity and cybersecurity management systems and AIS-190, covering software update management.
The technical standards are settled. The law giving them force is not. MoRTH issued a draft notification, G.S.R. 503(E), in June 2026, proposing new Rules 125-T and 125-U in the Central Motor Vehicles Rules, 1989 and invited industry comment before final gazette publication.
Table: Proposed compliance timeline under the draft cybersecurity rules
Wave | Vehicles covered | New models | Existing models |
|---|---|---|---|
1 | Level 3 and above automated vehicles | October 2026 | April 2027 |
2 | Over-the-air update enabled vehicles | April 2028 | October 2028 |
3 | Remaining software-enabled vehicles | October 2029 | October 2029 |
These dates sit in a draft and can move until MoRTH publishes the final gazette notification, so they are not yet binding type-approval law.
A separate draft notification proposes a full ADAS suite for buses and trucks, which are the M2, M3, N2 and N3 categories, rather than for private cars.
NITI Aayog has projected that around 90% of passenger vehicles sold in 2030 will carry ADAS features.
How to insure your self-driving or autonomous vehicle in India
Insuring a technology-heavy car well comes down to getting six things right at purchase and at every renewal.
Check that your IDV reflects the correct variant. An ADAS variant costs more than the base car. If the IDV on your policy reflects the base variant, you receive less than you should on a total loss or theft claim.
Declare anything retrofitted. Factory-fitted systems are already in the IDV. Aftermarket devices are not and undeclared accessories can complicate a claim.
Consider zero depreciation cover seriously. On a car where a large share of the repair bill sits in plastic housings and electronic parts, which depreciate fastest, zero depreciation changes the settlement materially. It suits newer cars best.
Add consumables cover. Calibration materials, fasteners and clips used during sensor repairs often fall outside the base policy.
Check the cashless garage network before you need it. Not every network workshop is equipped to recalibrate radar and cameras. Confirm that at least one near you is.
Review exclusions, then rely on warranty where the policy does not reach. Mechanical and electrical breakdown, software faults and wear are outside every standard motor policy. A sensor that fails on its own is a warranty matter.
Two further points apply to any car and matter more on an expensive one.
Keep comprehensive cover in force rather than dropping to third-party to save premium and protect your No Claim Bonus by paying small repairs yourself where the bonus you would forfeit is worth more than the claim.
If your car is electric as well as ADAS-equipped, the same logic applies with more force. Both technologies concentrate value in components that are expensive to replace and need specialist workshops, which is why electric car insurance rewards the same attention to IDV and add-ons.
Conclusion
Self-driving cars will change motor insurance , though not in the way the phrase suggests. The shift is from pricing a driver to pricing a system and from personal liability towards product liability. That shift has started overseas. It has not started here.
For Rohit and for anyone buying a car with an assistance pack this year, the practical answer is simpler than the headlines. The car is considerably smarter than the last one. The policy is the same policy.
The work lies in setting IDV correctly, choosing add-ons that match where the repair risk sits and confirming that a workshop near you can recalibrate what needs recalibrating.
Review your cover at every renewal rather than letting it roll over unchanged. Zurich Kotak General Insurance Company (India) Limited offers comprehensive, third-party and standalone own damage cover for private cars, with add-ons that can be matched to how your vehicle is built and used.
Frequently asked questions
Are self-driving cars available in India?
No. Cars sold in India offer Level 1 and Level 2 driver assistance, which supports the driver rather than replacing them. Level 4 and Level 5 vehicles are not available to private buyers here.
Is a car with ADAS covered by a normal car insurance policy?
Yes. A comprehensive policy covers an ADAS-equipped car in the same way it covers any other private car, with the technology reflected in the Insured Declared Value. Accidental damage to sensors and cameras is covered, subject to policy terms.
Does a car with ADAS cost more or less to insure in India?
Usually more. The hardware raises the car's insured value and the cost of repair and Indian motor pricing does not currently offer a specific ADAS discount. The safety benefit shows up over time as fewer claims.
Who is liable if a self-driving car is in an accident in India?
The registered owner and driver. The Motor Vehicles Act, 1988 contains no provision transferring liability to a manufacturer or software provider and Level 2 systems require the driver to supervise throughout.
Which technologies feature in self-driving cars?
Cameras, radar, LiDAR and ultrasonic sensors for perception, GPS and high-definition maps for positioning, artificial intelligence for decision-making and connectivity for updates and data exchange.
Can self-driving cars be hacked?
Any connected vehicle carries some exposure, which is why India is developing cybersecurity standards for connected vehicles. Standard motor policies do not cover loss arising from unauthorised access to vehicle systems.
Is sensor recalibration covered after an insured repair?
It depends on the insurer and the add-ons you hold. Calibration labour and materials can fall outside base cover, so confirm the position with your insurer before authorising repair.
Can my insurer access my car's data after an accident?
Not automatically. Sensor and software logs are held by the manufacturer and there is no settled Indian rule requiring their release to an insurer. Personal data within those records is also governed by the Digital Personal Data Protection Act, 2023.
Are new insurance products needed for autonomous vehicles?
Yes. Software failure, sensor malfunction and cyber intrusion fall outside standard motor wordings and product liability has no place in the current motor framework. Those gaps will need new products.
What is autonomous insurance and how would it differ from a standard policy?
Autonomous insurance describes cover priced against a driving system rather than a driver. It would assess software reliability, sensor performance and cybersecurity in place of a personal claims record.
Are electric and autonomous vehicles insured differently?
Both are insured under the same three policy types as any private car. Both concentrate value in expensive components needing specialist repair, which makes IDV accuracy and add-on selection matter more than on a conventional car.
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