MUMBAI: Bombay HC’s full bench has ruled that the amount received by an accident victim through a mediclaim policy cannot be deducted from the payout given under Motor Vehicles Act in the ‘medical expenses’ category.
The full bench of three judges clarified the law point last Friday following differing views taken by various division benches.
The matter before HC was an appeal filed by New India Assurance, Sakinaka, against claimant Dolly Gandhi and Janeshwar Pujari. The full bench of Justices AS Chandurkar, Milind Jadhav and Gauri Godse said the insurance company challenged the compensation awarded by the motor accident claims tribunal towards medical expenses, which the claimant had already received under a mediclaim policy from the insurer.
In 2013, HC took the view that money received under a mediclaim policy by a claimant was liable to be deducted from the amount of compensation that was to be awarded towards medical expenses. But in 2006 and 2019, a contrary view was taken by other benches.
The insurance company argued that the loss sustained by a claimant could be claimed only once and not on multiple occasions. Allowing both would “amount to a windfall to the claimant or double compensation in such eventuality”, its senior counsel Vineet Naik said.
The claimant said a mediclaim policy is based on a contract between the insurer and the insured, and that the rights of the parties are governed by contractual terms under such a policy and “cannot be watered down”. Under Section 168 of Motor Vehicles Act, a claimant is entitled to “just compensation” to be paid by the insurer of the offending vehicle. The liability is legal and flows from the concept of a “compulsory third-party insurance policy”, the victim’s counsel, T J Mendon said.
The amicus curiae (appointed to assist the court), Gautam Ankhad, said the victim’s right under Motor Vehicles Act “could not be diluted by permitting deduction of any amount received by such victim on account of any contractual obligation under a mediclaim insurance policy”.
The full bench agreed with the 2019 judgment of Calcutta HC, which said the insurer has to pay both times. “What a victim gets from his mediclaim policy is the return for making payment of premiums. It is the hard-earned money that he puts in towards the premium, which is thereafter returned to him upon the occurrence of an accident. The return that a victim receives from his insurer on a claim arising out of a mediclaim policy in the circumstances is consolation money,” Calcutta HC’s then judge Justice Dipankar Datta had said, adding that “to consider it as a benefit received from other sources while determining the amount of compensation would be a narrow minded approach… therefore the question of the victim being doubly benefited did not and could not arise.”
