Page 53 - The Insurance Times October 2025

Legal Briefs

Insurer to pay crash victim's kin Rs. 2.5 (IDV) recorded in the policy was Rs. 23,51,250.
crore On April 16, 2016, while transporting goods to Diwanganj,
the truck caught fire after an electric wire fell on it, result-
A motor accident claims tribunal has directed an insurance
ing in total loss. The fire brigade and police were immedi-
company to pay Rs 2.52 crore to the family of a man who
ately informed, and the insured promptly notified the in-
died in an accident in Okhla in May 2023.
surer. The appointed surveyor submitted his final report on
Presiding officer Shelly Arora observed, "In a case of death, August 6, 2016.
the legal heirs of the claimants cannot expect a windfall.
On March 21, 2017, the insurer wrote to the insured, stat-
Simultaneously, the compensation granted cannot be an
ing that the policy covered only the "horse" or front cabin
apology for compensation."
of the vehicle, not the trailer. The insurer contended that
Yaseen Khan was a 30-year-old senior resident doctor earn- the attachment of a trailer was never disclosed, even though
ing Rs 1.4 lakh per month. He was survived by two minor it constituted a material change in risk. It alleged that the
sons, his wife and parents. Another son was born four insured had violated the doctrine of utmost good faith and
months after his death. breached the policy conditions.
Considering the testimony of an eyewitness, the tribunal The insured contested this stand, pointing out that the horse
ruled that rash driving by the bus driver caused the acci- could not operate without the trailer and emphasising that
dent. "It is a well-established legal principle that... the facts the truck and trailer function as a single unit. The insured
and circumstances must be considered in a broad and prac- further requested the insurer to specify which terms and
tical manner. It is also settled that proceedings under Mo- conditions of the policy had been breached.
tor Vehicles Act are different from regular civil suits and are
Despite providing all documents, clarifications to queries,
not strictly governed by the technical rules of Indian Evi-
and persistent follow-ups, the claim remained unsettled.
dence Act," it said.
Consequently, the insured filed a complaint before the Uttar
Advocate Sumit Chaudhary, the counsel for the claimant, Pradesh State Consumer Disputes Redressal Commission
contended that there was no dispute regarding the identi- alleging deficiency in service.
fication and involvement of the bus and its driver. Chaudhary
The insurer contested the case, maintaining that the attach-
said Khan's family was dependent on his earnings. He also
ment of a trailer was never disclosed. It also claimed that
highlighted that the untimely death had caused immense
the electric company, whose wire had fallen on the truck,
financial and emotional hardship to them.
had not been informed. The insurer also faulted the insured
New India Assurance Company did not raise any dispute for not following its instructions to meet certain persons
regarding the cause of the accident. regarding the incident.
The state commission overruled all objections, observing
Insurer penalised for unjust claim denial that there was neither suppression of facts nor alteration

Concrete Udyog, a limited company, owned a truck for use of risk. It noted that the policy did not require intimation to
as a public carrier. It was insured by National Insurance the electric company. It held that a police complaint was
under a Public Carrier Package Insurance Policy valid from properly lodged, and there was no need to ask the insured
May 25, 2015, to May 24, 2016. The insured declared value to meet other persons regarding the incident.

The Insurance Times October 2025 49