G.M., UNITED INDIA INSURANCE CO.LTD. vs M. LAXMI .

The Supreme Court held that under Section 166 of the Motor Vehicles Act, 1988, the insurer is not liable to compensate a gratuitous passenger, such as the deceased who was a pillion rider, if the insurance policy is an Act policy. The Court emphasized that the liability of the insurer is limited to the terms of the policy, which in this case did not cover pillion riders. The High Court's judgment allowing compensation was set aside, reaffirming that the insurer had no liability in this instance.