Page 59 - Motor Insurance Ebook IC 72

Guide for Motor Insurance

need to disclose all particulars of his insurance if
demanded by the third party. The duty also applies to
the Insurer who is expected to give an inspection of the
policy and other documents to the injured party.

Q9. What are the rights of third parties against
insurers on insolvency of the insured? Explain.

Ans. Sec 150 of Motor Vehicle Act, 1988 provides for the
rights of Third parties in the event of the insolvency of
the insured or in the event of winding up when the insured
is a Company.

The Act provides that if, either before or after that event,
any third party liability is incurred by the insured, and
his rights against the insurer under the policy are
transferred to the third party to whom the liability was
incurred.

When such transfer takes place, the insurer will be under
the same liability to the same liability to the third party
as he would have been to the insured person, but
1. If the liability of the insurer to the insured person

EXCEEDS the liability of the insured person to the
third party, the insured persons; rights against the
insurer in respect of the excess are not affected.
Examples: The Act provides for third party property

Sashi Publications - www.sashipublications.com 59

Copyright@ The Insurance Times. 09883398055 / 09883380339