Andhra Pradesh High Court Applies Deemed Transfer of Motor Insurance

The Andhra Pradesh High Court held that an insurer cannot refuse compensation solely because a valid vehicle policy was not formally transferred into the new owner’s name.

Background and dispute

The dispute arose from a workman’s death involving a vehicle whose ownership had changed while the insurance cover remained in force.

Legal issue and court’s approach

The Court applied Section 157(1) of the Motor Vehicles Act, which deems the insurance certificate and related rights and liabilities transferred upon sale of the vehicle. Formal failure to update the policy did not extinguish the relevant statutory protection.

Order and practical consequence

The insurer remains liable according to the compensation order and policy terms applicable to the accident.