Page 58 - Insurance Times August New 2023

of the multiplier method that applies different multipliers in awarding compensation by Courts and Tribunals, leading
for different periods of time, typically pre-retirement and to confusion among common people. In National Insurance
post-retirement periods. This approach is usually used when Company Limited v. Pranay Sethi, the Supreme Court held
the victim has suffered a permanent disability that affects that uniformity and consistency could be achieved if the
their ability to earn income. While the split multiplier multiplier method prepared in the Sarla Verma case was
method was applied in some cases, it has been criticised for followed.
lack of uniformity and consistency, which led to confusion in
The High Court acknowledged that the aforesaid decisions
assessing compensation.
were dealing with cases where the accidents had resulted
The present case involved two appeals, one filed by the in death. However, it was concluded that it would be
insurance company and the other by the injured claimant, inappropriate to alter the legal position solely because the
challenging the Motor Accident Claims Tribunal's award result of the accident was an injury rather than death. "The
granting compensation for injuries sustained in a motor moot question is whether the dictum as regards the
accident. The accident occurred in April 2007 when the multiplier method laid down in Sarla Verma (supra)... would
claimant's scooter was hit by a bus owned and insured by undergo any change, if the result of the accident is an injury,
the respondents after which the claimant sustained instead of a death. This Court is of the definite opinion that
it would not."
substantial injuries. The Tribunal found that the accident had
resulted from the negligent driving of the bus and awarded
Accordingly, the Tribunal was found to have erred in
compensation of over Rs. 5 lakhs along with interest to the
applying the split multiplier method and it was clarified that
claimant. the method fixed in previous judgments should also apply
uniformly in injury cases. Regarding the compensation, the
Advocate V.P.K Panicker appeared for the insurance
claimant was found entitled to additional compensation for
company and contended that the compensation for
'loss of amenities' due to his permanent disability, 'pain and
permanent earning disability (monthly Rs.1500 for the next
suffering' for the severity of his injuries, and 'extra
9 years) was erroneous since the claimant had not suffered
nourishment' during hospitalization. The total compensation
any loss of income due to disability. The insurer also
awarded after enhancement was Rs. 7,67,148/-.
challenged the calculation of a 15% functional disability,
especially for a post-retirement period of 5 years. Advocate The Court directed the insurance company to pay interest
Geetha Kumari appeared for the claimant and argued that at the rate mentioned in the original award for the initial
the Tribunal wrongly applied the split multiplier method and amount and 8% interest for the enhanced amount, with any
overlooked the impact of disability on his personal life, delay affecting the interest accrual. Thus, the claimant's
particularly 'loss of amenities and conveniences.' appeal was partly allowed while the insurance company's
appeal was dismissed.
Justice Jayachandran referred to the Apex Court decision in
Sarla Verma v. Delhi Transport Corporation which expressed Case Title: The Oriental Insurance Company Ltd v. Abdul
concern over the considerable variation and inconsistency Khader Citation: 2023.

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50 August 2023 The Insurance Times