Page 42 - Insurance Times September 2015 SAMPLE

8-1-1- Ss 227(1) (b) (ii) Specific exclusion of gratuitous

passenger from the coverage.

8-1-2- Ss 227 (2) -'Provided that the maximum liability

for compensation to a victim by the insurer linked to the
regulated minimum premium shall be a sum of fifteen lakh
rupees for such higher amount as may be prescribed by the
Central Government from time to time.'

8-1-3-Analysis - It is a settled law that the liability of the 8-4- S. 244 Draft Bill, 2015 corresponding to S.
163-A M V Act, 1988 - Special provisions as to payment
Insurer was limited to Section 147 which provides a limit of
Rs. 6000/- for third party property damage but no limit so of compensation on structured formula basis.
far as personal injury or death of any person is concerned.
But as per the corresponding proviso in the Draft Bill, 2015, 8-4-1- Ss. 163-A(1) M V Act, 1988 - Do not provide
the Maximum liability of insurer was limited to Rs. 15 lakh
or such higher amount as may be prescribed by the Central any bottom line on the amount of compensation payable
Government from time to time. under structured formula basis. However, the corresponding
provision in Ss. 244(1) of the Draft Bill, 2015 provides that,
With this it seems that we are back into a limited “the minimum compensation in case of death shall not be
compensation regime. less than Rs 20 lakh rupees or such higher amount as may
be prescribed from time to time by the Central
8-2- S. 230 Draft Bill, 2015 corresponding to S. 149 Government."
M V Act, 1988- Duty of insurer to satisfy Judgment
against persons insured in respect of third party 8-4-2-Apart from the above Ss. 244 (3) of the
risks. Draft Bill, 2015 Further provides that, "notwithstanding

8-2-1- Ss. 230(1) and 230 (2) (c) Draft Bill, 2015 - anything contained in this section regarding death or bodily
injury to any person for which insurer is liable to give
Statutory defense for the insurer- Non compliance of compensation for relief, the insurer is liable to pay
Section 64 VB of the Insurance Act was included in the list compensation under any other law for the time being in
of statutory defenses. Now Insurer can raise the defense force”.
of Section 64 VB of the Insurance Act.
Provided that the amount of such compensation to be given
8-3- S. 241 Draft Bill, 2015 corresponding to S. 161 under any other law shall be reduced from the amount of
M V Act, 1988- Special provisions as to compensation payable under this section.
compensation in case of hit and run motor
accident- 8-4-3- Analysis - In view of the above, it is clear that the

8-3-1- The fixed amount of compensation of Rs. 25,000/- minimum compensation under the structured formula basis
shall not be less than Rs. 20 lakh. However, even after
for death and Rs. 12,500/- for grievous injury as existed in payment of the amount of compensation the liability of
Ss. 161 (2) of M V Act, 1988 was replaced with "such insurer subsists to pay compensation under any other law
amount as may be prescribed by the rules made by the for the time being in force.
Central Government." u/Ss. 241(2) Draft Bill, 2015. It means
the amount of compensation payable to the Hit and Run
Crash victims was not specified in the Act which will, be
prescribed in the Rules framed to that effect.

38 The Insurance Times, September 2015

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