An insurer bears no liability for an unauthorised tractor passenger outside policy coverage.

The claimant, then a minor, was injured after falling from the mudguard of a tractor while travelling as a passenger.

The Tribunal found the tractor driver negligent and ordered the insurer to pay compensation of ₹1,00,235 and recover it from the vehicle owner, despite finding that the claimant was an unauthorised passenger.

The insurer appealed, challenging the pay-and-recover direction.

Whether the insurer could be directed to pay compensation and recover it from the owner when the injured claimant travelled as an unauthorised passenger in a tractor.

Whether the policy covered the claimant’s risk, given that it covered only the tractor’s driver.

Section 147(1)(b) of the Motor Vehicles Act, 1988, requires insurance against specified third-party liabilities, including bodily injury to persons carried in a vehicle within the provision’s scope.

Relying on United India Insurance Company Limited v. Ammu and five others, 2026 (1) TN MAC 44 (DB), the Court stated that insurance coverage depends on the statutory provision and the terms of the policy; an insurer is not liable for a risk falling outside the policy’s coverage.

The claimant admitted that he was riding on the tractor’s mudguard, and the policy covered only the driver; the tractor’s seating capacity was limited to the driver.

The Court therefore held that the claimant was an unauthorised passenger whose risk was not covered by the policy. In those circumstances, it found the Tribunal’s pay-and-recover direction unsustainable.

The Court set aside the Tribunal’s direction requiring the insurer to pay and recover the compensation, exonerated the insurer from liability, and left the claimant at liberty to recover the Tribunal-awarded compensation from the vehicle owner.

No costs were ordered.