1[Settlement between insurers and insured persons. --- (1) No settlement made by an insurer in respect of any claim which might be made by a third party in respect of any liability of the nature referred to in clause (b) of sub-section (1) of section 147 shall be valid unless such third party is a party to the settlement.
(2) The Claims Tribunal shall ensure that the settlement is bona fide and was not made under undue influence and the compensation is made in accordance with the payment schedule referred to in sub-section (1) of section 164.
(3) Where a person who is insured under a policy issued for the purpose of this Chapter has become insolvent, or where, if such insured person is a company, a winding-up order has been made or a resolution for a voluntary winding-up has been passed with respect to the company, no agreement made between the insurer and the insured person after the liability has been incurred to a third party and after the commencement of the insolvency or winding-up, as the case may be, nor any waiver, assignment or other disposition made by or payment made to the insured person after the commencement aforesaid, shall be effective to defeat the rights transferred to the third party under this Chapter; but those rights shall be the same as if no such agreement, waiver, assignment or disposition or payment has been made.]
(2) The Claims Tribunal shall ensure that the settlement is bona fide and was not made under undue influence and the compensation is made in accordance with the payment schedule referred to in sub-section (1) of section 164.
(3) Where a person who is insured under a policy issued for the purpose of this Chapter has become insolvent, or where, if such insured person is a company, a winding-up order has been made or a resolution for a voluntary winding-up has been passed with respect to the company, no agreement made between the insurer and the insured person after the liability has been incurred to a third party and after the commencement of the insolvency or winding-up, as the case may be, nor any waiver, assignment or other disposition made by or payment made to the insured person after the commencement aforesaid, shall be effective to defeat the rights transferred to the third party under this Chapter; but those rights shall be the same as if no such agreement, waiver, assignment or disposition or payment has been made.]
Source footnotes
1. Subs. by Act 32 of 2019, s. 51, for 'CHAPTER XI' (w.e.f. 1-9-2019).आगे पढ़ें / Continue reading
Explore the next section or browse this act in the selected language.
Next · Section 154Saving in respect of sections 151, 152 and 153. →All sections / सभी धाराएँThe Motor Vehicles Act, 1988 →
More sections of this act
Section 1 · Short title, extent and commencement.Section 2 · Definitions.Section 2A · e-cart and e-rickshaw.Section 2B · Promotion of innovationSection 3 · Necessity for driving licence.Section 4 · Age limit in connection with driving of motor vehicles.Section 5 · Responsibility of owners of motor vehicles for contravention of sections 3 and 4.Section 6 · Restrictions on the holding of driving licences.India Code, Government of India. Text fetched 10 Oct 2026. Source metadata reports last modification: 2025-11-07. Check the linked official text and subsequent notifications when applying a provision.