Front Page

Court ruling on third party insurance

MADURAI: Insurance companies are not liable to pay third party insurance in a road accident involving a tourist vehicle unless the driver’s licence contains an endorsement authorising him/her to drive vehicles meant for commercial use, the Madras High Court has ruled.

Disposing of a civil appeal filed before the Madurai Bench, Justice S.R. Singharavelu said: “It is necessary for a driver of a commercial vehicle not only to possess a licence to drive the vehicle but also to have the endorsement. If it is not so, there would be a breach of condition of the contract of the insurance, in the event of which the liability of the insurer could be avoided.”

Section 3 of the Motor Vehicles Act mandates every driver to hold an effective driving licence for the type of vehicle which he/she intends to drive. When an insurance policy relates to a commercial vehicle, it is necessary for a person to have appropriate endorsement on the licence. “Otherwise, the driver will be called only as ‘not duly licensed’ as contemplated in Section 149(2) (a) (ii) of the Act,” he said. The appeal was filed by a nationalised insurance company against an award passed by the Motor Accident Claims Tribunal in Tenkasi to pay Rs.1.45 lakh to the family of a person who died after being hit by a tourist taxi on February 1, 1995. The appellant claimed that the taxi driver did not possess a valid licence.

However, on perusing the records, the Judge found that the licence contained an endorsement to drive ‘maxicab’ and the driver was also holding a cab driver’s badge. “In such circumstances, it cannot be said that the driver was not holding a valid licence to drive the vehicle in question,” he said and upheld the award passed by the tribunal.

© Copyright 2000 - 2009 The Hindu