Pillion rider not entitled to third-party insurance: SC

A pillion rider who dies or gets injured in a road accident is not entitled to third party insurance claim...

A pillion rider who dies or gets injured in a road accident is not entitled to third party insurance claim, the Supreme Court has said. If a vehicle is covered only by a third party insurance, neither the owner, nor the passengers are covered, unless, the contract of insurance is specific that it would cover others too, a Bench of Justices S B Sinha and L S Panta said.

The Bench passed the ruling while quashing the Rs 1.18 lakh compensation awarded by the Motor Accidents Claims Tribunal MACT in Kerala to the next of a woman pillion rider who died after falling from the scooter on which she was travelling.

The deceased Thankamani was pillion riding a scooter on October 20, 1993 when she accidentally fell down and died. Her family filed a claim for insurance compensation. But Oriental Insurance Company, the insurer, raised a contention that the policy did not cover the risk of injury or death for Thankamani as she was a gratuitous passenger. Hence, it was not liable to pay any compensation for her death.

However, the MACT rejected the insurance company8217;s claim and awarded the Rs 1.18 lakh compensation.

The Kerala High Court later upheld the MACT8217;s decision following which the insurer Oriental Insurance Company filed the appeal in the apex court. Upholding the insurance company8217;s plea, the apex court said that in terms of Section 147 of the Motor Vehicle Act, only in regard to reimbursement of the claim to a third party, a contract of insurance must be taken by the owners of the vehicle.

8220;The liability of the insurer to reimburse the owner in respect of a claim made by the third party, thus, is statutory whereas other claims are not,8221; the apex court observed. When, however, an owner of a vehicle intends to cover himself from other risks; it is permissible to enter into a contract of insurance in which event the insurer would be bound to reimburse the owner of the vehicle strictly in terms thereof, the Bench said.

The apex court said that the provisions of the MV Act and, in particular, Section 147 were enacted for the purpose of enforcing the principles of social justice.

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8220;It, however, must be kept confined to a third party risk. A contract of insurance that is not statutory in nature should be construed like any other contract,8221; the Bench observed.

In the present case, the bench said, the parties had only entered into a contract of insurance for the purpose of covering the third party risk and not the risk of the owner or a pillion rider.