The Madras High Court has directed the Insurance Regulatory Development Authority (IRDA)
to enhance compulsory personal accident cover from Rs 1 lakh to not
less than Rs 15 lakh, enabling vehicle owners paying premium to get
adequate compensation in the event of death or bodily injury.
A
division bench comprising justices R Subbiah and A D Jagadish Chandira
gave the order while allowing an appeal by United India Insurance Co. Ltd, Neyveli.
Referring
to an IRDA note in the policy, the judges said that the policy to
compensate vehicle owners by virtue of the personal accident cover was
introduced 15 years ago. In 2002, Rs one lakh envisaged under it might
have been enough to meet medical expenses of the injured owner to a
certain extent.
However, 15 years had
lapsed and medical treatment costs had sky-rocketed, the judges said and
directed IRDA to enhance the compulsory personal accident cover from
the existing Rs one lakh to at least not less than Rs 15,00,000.
The
bench directed IRDA to have consultation with all stakeholders before
enhancing the premium for getting compensation under the compulsory
personal accident cover.
The judges also
directed IRDA to undertake and complete such an exercise within six
months from the date of receipt of a copy of the judgement.
The
enhanced amount would add to some succour or solace to victims of road
accidents, who are vehicle owners, who may incidentally sustain physical
injury or die, they said. "It is unfortunate that the owner of the
vehicle,who pays premium amount for risks that may be confronted by the
third party or due to any other factor, is not getting adequate
compensation in the event of his or her death or bodily injury, the
judges said.
The matter relates to an
appeal by the insurance firm, challenging the award of total
compensation of Rs 51,37,125 and the April 28, 2015 decree by the Motor
Accident Claims Tribunal (Subordinate Judge), Neyveli, by which the
claim petition filed by the legal heirs of a deceased motorist was
allowed.
The insurance company submitted
that under Section 147 of Motor Vehicles Act,the risk of the
deceased,who is the vehicle owner, was not required to be covered by
them.
If at all the claimants/respondents
were entitled, it could only be to a maximum amount of Rs one lakh and
nothing more, it said and sought dismissal of the petition.
As
the court felt IRDA's assistance was necessary for disposal of the
appeal, the bench directed it to depute one of its counsel to assist the
court in the matter.
IRDA's counsel drew
the court's attention to provisions of Section 146 of MVA and submitted
that it was not necessary to provide insurance coverage for the owner
of the vehicle, who sustained injury or died due to his/her own
negligence.
This section mandates that
vehicle owners get compulsory insurance for motor vehicles against
liability for death/ bodily injury to persons/property caused by use of
vehicle.
The bench, while referring to
various Supreme Court orders, allowed the appeal by United India
Insurance and said it cannot be fastened with any liability under
provisions of MVA for death of the victim, who was the owner of the
vehicle, when no other motor vehicle was involved in this case.
"Therefore,
the question of the insurer being liable to indemnify the
deceased/owner of the vehicle does not arise," the court said.
Since
the victim was the owner of the two-wheeler and not a third party, the
claim petition filed by the claimants would not come within the purview
of Section 146 or 147 of MVA for the purpose of payment of compensation,
the judges said.
"Therefore, we hold
that the impugned judgement and decree of the Tribunal cannot be
sustained. The appeal filed by the insurance company deserves only to be
allowed."
At the same time, it is
needless to mention that the claimants were entitled for payment of Rs
one lakh only towards personal accident cover proportionate to the
premium paid by the deceased, the bench said.
"We are pained to observe that as per the Indian Motor
Tariff, compensation payable to the legal heirs in case of death or
bodily injury suffered by the owner of the vehicle is restricted to Rs
1,00,000 only in case of two-wheeler and Rs 2,00,000 in case of
four-wheeler, by virtue of compulsory personal accident cover mooted by
the statutory authorities in charge of regulating the Motor Insurance Policies," it said.
Source: Economic Times
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