Section 64 VB of Insurance Act, 1938 for advance payment of premium renders contract void ab initio but the fact of dishonor of cheque must be communicated to insured and RTA effectively to exonerate from statutory liability of payment by Insurer.
To avoid liability towards the insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not been disqualified to drive at the relevant time.
When there is limit of liability, the insurer cannot be asked to pay and seek recovery.
In Germany, in case of death of a person, the maximum lumpsum amount that can be paid under Motor Third Party insurance is Euro 6,00,000.
As per the 'limits of liability' specified in the MV Act, in respect of damage to any property of a third party out of one accident, the limit is Rs. 6,000.
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