Insurance -- Motor Vehicle Insurance -- Surrender of Vehicle to Financer -- Financer not entitled to indemnification in absence of privity of contract
Insurance Act, 1938 -- Motor Vehicle Insurance -- Surrender of Vehicle by Insured to Financer -- A contract of insurance is a personal contract between the insured and the insurance company only. A financer who receives possession of a vehicle by surrender from the original insured does not thereby become the owner of the vehicle. In the absence of privity of contract between the financer and the insurance company, the insurance company cannot be compelled to indemnify the financer for any loss of the vehicle, even where the loss occurred while the vehicle was in the possession of the financer.
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