SC: Insurer liable to pay compensation even after change of vehicle ownership

The Supreme Court has passed out the judgement that insurers are legally responsible to pay compensation even if possession of the motor vehicle transfers.

  

The apex court said in its judgement, "The liability to pay compensation is based on a statutory provision. Compulsory insurance of the vehicle is meant for the benefit of the third parties. The liability of the owner to have compulsory insurance is only in regard to third party and not to the property. Once the vehicle is insured, the owner as well as any other person can use the vehicle with the consent of the owner. Section 146 of the Act (Motor Vehicles Act, 1988) does not provide that any person who uses the vehicle independently, a separate insurance policy should be taken. The purpose of compulsory insurance in the Act has been enacted with an object to advance social justice."