Page 14 - Motor Insurance Ebook IC 72

The Insurance Times

sufficient means to pay. Prior to 1930, there was no
law of compulsory insurance in respect of third party
rights in England.

It is under such circumstances 'Road Traffic Act, 1930'
was enacted in England, for compulsory insurance of
motor vehicles in respect of third party risk to secure
payment of compensation to the vehicular victims.

In the same year the "Third Parties' Rights Against
Insurance Act, 1930' was also enacted to empower the
third party to sue insurer even when it is not a party to
the contract of Insurance in England.

This heralds a new era and ensured compensation to
the vehicular victims notwithstanding the financial
standing of the owner of the vehicle.

In India, compulsory motor third party insurance was
introduced w.e.f. 1st July 1946. Section 94 of the M. V.
Act, 1939 which correspond to Section 146 of the M.
V. Act, 1988 mandates for compulsory third party
insurance of the vehicle.

In other words, legally it is mandatory for every owner
to ensure compulsory third party insurance of his vehicle
and a certificate of insurance in proof thereof issued by

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