HYDERABAD: The Motor Accidents Claims Tribunal, Secunderabad, recently directed Tata AIG General Insurance Company, along with the owner and driver of a tipper truck, to pay `24 lakh in compensation to the family of a man who died in a road accident on October 5, 2019, at Medchal.
Following the death of the victim, Chikkullapally Ramesh, his wife and their three minor daughters filed a complaint with Medchal police in 2019. During the proceedings, the insurance company argued that the petition against them was not maintainable, as the vehicle in question was not insured at the time of the accident.
The company stated that the tipper’s owner, Singi Election Reddy, had obtained an insurance policy and issued a cheque dated June 28, 2019, for payment of the premium. However, when the company attempted to withdraw the funds, the bank dishonoured the cheque due to “insufficient funds” in the owner’s account. The insurer subsequently sent a notice to him via speed post on November 12, 2019, but received no response.
Despite this, the Tribunal, citing the Supreme Court’s ruling in National Insurance Company Limited v. Balkar Ram and Others, held the insurance company liable to compensate the victim’s family. The apex court, in that judgment, stated: “Failure on the part of the insurance company to give intimation regarding the dishonour of a cheque and cancellation of policy to the policyholder before the date of the accident — the defence that the insurance policy was not valid since the cheque had been dishonoured prior to the accident would not exonerate the insurance company.”
The Tribunal also referenced several other judgments from higher courts, along with relevant provisions from various Acts.
Additionally, during cross-examination, the insurance company admitted that it had issued a policy for the vehicle covering the period from June 28, 2019, to June 27, 2020. The cheque was dishonoured on September 23, 2019, and an intimation letter regarding the same was sent on November 12, 2019.
The petitioners argued that the deceased, a barber, earned `30,000 per month and contributed his entire income to his family. They contended that had he been alive, he would have had better career prospects and financial growth.
Taking all factors into account, the Tribunal awarded `24,77,000 in compensation, along with costs and an interest rate of 7% per annum. Of the total, `12,77,000 would be given to the deceased’s wife while `4,00,000 each was for his three daughters.