Family loses Rs 51 lakh death compensation due to insurance norms

TNN | Oct 28, 2017, 23:56 IST

Chennai: R Rekha was jolted by her husband P Rajini's untimely death in 2011. But the shock she suffered six years later -- when the Madras high court cancelled the Rs 51.37 lakh accident compensation awarded by a tribunal in 2015 -- was no small blow either, even if it did not measure up to losing her husband.

Rajini was travelling pillion on his own bike on June 13, 2011 when the rider Balamurugan swerved the two-wheeler to avoid hitting a cyclist near Neyveli. He lost balance, and Rajini was thrown off the vehicle. He succumbed to head injuries the next day. When the family comprising Rekha, her son Himanish and parents-in-law moved a motor accidents claims tribunal in Neyveli seeking Rs 60 lakh compensation, they were awarded Rs 51.37 lakh in in April 2015.

But, pointing out that Rajini was riding on his own bike and that the insurancewould cover only third party risks and not the owners of vehicles, United India Insurance Company filed an appeal in the high court.

A bench of Justice R Subbiah and Justice AD Jagadish Chandira found that it was legally bound to accept the insurance company's arguments.

The insurance company submitted that under Section 147 of the Motor Vehicles Act, risk of the deceased, who is the owner of the vehicle, was not required to be covered by the company and, if at all, the claimants/respondents were entitled, it could only be to a maximum amount of Rs 1 lakh under the compulsory personal accident coverage as per the insurance policy and nothing more.

While concurring with the submissions, the judges said the personal accident cover norm was introduced 15 years ago. "In 2002, Rs 1 lakh might be sufficient to meet medical expenses for treatment of the injured owner of the vehicle to a certain extent. Now, 15 years have lapsed and the cost of medical treatment has sky-rocketed. Due to the negligence of the owner of the vehicle, if a third party suffers bodily injury or even death, such third party or his family members will get adequate compensation from the insurance company befitting to the pecuniary loss sustained by the injured or on account of the death of the deceased. On the contrary, if owner of the vehicle himself sustains bodily injury or dies in a motor accident, due to his or her own negligence, the owner of the vehicle or his or her family members will not get compensation. It is unfortunate that the owner of the vehicle, who pays premium amount for the risks that may be confronted by the third party, is not getting adequate compensation in the event of his death or bodily injury," said the judges.

"Taking note of the escalation in the cost of living, particularly the cost of medical treatment, we direct the IRDA to enhance the compulsory personal accident cover from the existing Rs 1 lakh to at least not less than Rs 15 lakh so that the amount will add some succour or solace to the victims of road accidents, who are the owners of the vehicles, and may incidentally sustain bodily injury or death," they said.