Page 119 - Liability Insurance IC74

Guide for Liability Insurance

Q1. Give an outline of the Compulsory Public Liability
policy and its rating system.

Ans. The principle of Indemnity states that an insured can
recover his financial loss only to the extent of his
insurable interest. The objective is to ensure that the
insured's loss is made good in such a way that financially
the insured is neither better off nor worse off as a result
of the loss.

These insurances are designed to provide the insured a
protection against the financial consequences of legal
liability. If the insured is legally liable to pay for damages,
the policy indemnifies him subject to the terms, conditions
and limitations of the contract. Indemnity is also available
in respect of legal costs and expenses incurred by the
insured with the written consent of the insurers in the
defense of settlement.the amount of relief pay able
under the Act as per the schedule is as follows:
(i) Fatal accident - Rs.25,000 per person

(ii) Permanent Total disability - Rs.25,000 per person

(iii) Permanent Partial disability - the amount of relief
on the basis of percentage of disablement and
certified by an authorised medical practitioner .

(iv) Temporary Partial disability - fixed monthly relief
not exceeding Rs.1000 per month up to a maximum
of 3 months(if only the victim has been hospitalised

Sashi Publications - www.sashipublications.com 115

Copyright@ The Insurance Times. 09883398055 / 09883380339