Third Party, Fare-Paying Passengers, and Non-Fare Paying PassengersIndivisuals travelling in a vehicle can bedivided in several categories with reference to auto insurance. Read to find out more.
Apnainsurance.com Research Bureau
29 Nov 2007
- Third Party - An insurance policy is between two parties, the insurer and the insured. Therefore, a third party is any person who is neither the insured nor the insurer. Third parties in car insurance terms are mainly pedestrians and fare-paying passengers in a vehicle. Persons in other vehicles like the driver, the owner, or passengers are also third parties.
- Fare-Paying Passengers - They are the people who are carried in a public service vehicle i.e. any motor vehicle used to carry passengers, such as taxis, auto rickshaws, and buses.
- Non-Fare Paying Passengers - They are the people who are allowed to travel in a vehicle for free. For instance, the owner of the goods being transported traveling in the goods vehicle is a non-fare paying passenger. In addition, passengers allowed to travel on humanitarian grounds are also non-fare paying passengers.
It is important to note that a vehicle owner is legally bound to provide roadworthy vehicles and appoint competent drivers. The vehicle owner's responsibility commences from the time a passenger enters the vehicle and continues until the passenger alights from it. Any accident in the interim period is the responsibility of the owner.
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