All You Need to Know About Section 166 of the Motor Vehicle Act

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The Motor Vehicles Act, 1988 has been a landmark legislation acting as the sole judicial remedy for parties involved in road accidents. Here we discuss, the importance of this act as well as the prevailing Section 166, which specifies who can claim compensation in the Motor Accident Claim Tribunal.

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          Need of the Motor Vehicles Act, 1988

          With the increase in vehicular traffic, accidents caused by motor vehicles are no more a rare sight nowadays. In such uncertain situations, many lose their property and some even their lives.

          This doesn't need to occur due to your fault every time. Sometimes, you get involved in an accident due to the fault of others.

          The Motor Vehicles Act, 1988 comes in as a legislative redressal in such situations with provisions that protect the interests of those who aren’t at fault, ensures adequate compensation, and justice to the victim as well as punishment for the person whose ignorance called for the accident.

          It is only through this act that an offender can be held liable in the case of an accident so that compensation can be provided to those who suffered because of the fault of others. Hence, this act aims at preventing road accidents as well as serve as a legislative mechanism in case an unfortunate incident occurs.

          What is the Motor Vehicles Act, 1988?

          The first act to come into force for the regulation of road transport vehicles involved in accidents was the Motor Vehicles Act, 1914. This act was further replaced by the Motor Vehicles Act, 1939.

          After this, the urgent and rising need for an improved legislation process, which covers all the facets of vehicular accidents through its provisions, was required. This led to the emergence of the Motor Vehicles Act, 1988, which replaced the Act of 1939.

          This Act, which was implemented on the 1st of July, 1989, emerged as landmark legislation coming in as a strong force to regulate vehicles and transport on the road. Its salient features included:

          • Providing for the welfare of the public after they involuntarily get involved in an accident
          • Its provisions ensure the welfare of the ‘Third-Party’. Third party insurance includes all those who were at no fault in an accident but got involved due to ignorant and reckless driving by others, hence becoming a party to the incident.
          • This particular act comprehensively covers all the aspects involved in the transport of vehicles on the road
          • The act mandates carrying valid motor insurance while driving on Indian roads, making third-party car insurance the most basic compulsory document

          Section 166 of the Motor Vehicles Act

          Now that you have a fair and necessary understanding of what is the Motor Vehicles Act, 1988 as well as, why was there a need for improved legislation to be implemented, let's move ahead to addressing the question you came here for – What is Section 166 under this act?

          In simple words, Section 166 of the Motor Vehicles Act, 1988 includes provisions for who all can apply for compensation in the Motor Accident Claims Tribunal(MACT) in case they get involved with a road accident. As per this section, a person can claim compensation in MACT if:

          • They have sustained an injury in the accident
          • They are the owner of the property damaged/involved in the accident
          • They are a legal representative of the person who passed away in the road accident
          • They are an authorized agent of the injured party or the legal representatives of the person deceased in the accident.

          Please note that in such cases, the ‘Owner’, under section 2(30) of the act, will be classified as the person whose name stands registered with the motor vehicle, and in the case of a minor, the person who is the guardian of the involved minor.

          How can the Compensation under Section 166 be Claimed?

          Compensation under this section can be claimed by applying with either one of the following tribunal locations:

          • The claims tribunal where the owner of the vehicle is residing in
          • The claims tribunal where the claimant is residing in
          • The claims tribunal which occurs to be in the location where the accident took place

          Can the Compensation be Claimed Anytime?

          Even though there is no prescribed time limit within which the application for the claim is to be filed, it should still be ensured that it is done within a reasonable amount of time. Doing otherwise can raise queries and doubts in the tribunal. Compensation is awarded to the concerned party by the tribunal in the following cases:

          • When the accident has resulted in injury to their body or even death
          • When the accident has caused loss/damage to their property
          • When the accident has compulsorily risen out of motor vehicles

          What Amount can be Claimed as Compensation under this Act?

          The amount of compensation that can be claimed under this section has been laid down in Sect 163A of the MV Act, 1988. Nonetheless, the owner of the vehicle or the insurer is liable to pay the following amount:

          • If the victin dies in an accident, a minimum compensation of Rs. 50,000 is to be paid.
          • If the victim suffers permanent disability, a minimin of Rs. 25,000 is to be paid.

          Moreover, as it may seem fit, the tribunal can grant additional compensation to the victim based on their case.


          The Motor Vehicles Act, 1988 was enacted as a preventive measure for road accidents as well as a remedial measure in the case an accident occurs. However, laws that require implementation otherwise are nothing more than countless papers.

          It is not only the responsibility of the government, but the people as well to ensure effective implementation of this act so that genuine redressal can take place in cases of unfortunate incidents. Everyone should act responsibly on the road and follow all traffic rules diligently to mitigate road accidents.

          Additionally, while prevention is always better than cure, unforeseen events can still occur anytime on the road, so make sure that you do your research and buy the best car insurance policy for your vehicle. You can compare car insurance quotes on and choose the plan that best suits your needs.

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