15 May 2025 Motor Accident >> Family Law   |   Insurance >> Personal Law  

The Supreme Court recently in The Tata Aig General Insurance Co. Ltd. v/s Suraj Kumar & Others., overturned a High Court's directive that compelled an insurance company to provide prosthetic limbs and a motorized wheelchair, along with ongoing monitoring, to a motor accident victim. The Court clarified that an insurer's liability is primarily to indemnify losses in monetary terms, not to manage the victim's future well-being through direct provision of goods and services.

The case stemmed from a 2008 accident where the victim, a 22-year-old cleaner, suffered 90% impairment of both lower limbs, with one being amputated. The Motor Accident Tribunal had initially awarded him Rs. 16.34 lakhs with 9% interest. The claimant then appealed to the High Court, which issued the order for direct provision of prosthetic limbs and a wheelchair, as well as ongoing support.

The Supreme Court, acknowledging the High Court's "ideal" intention to ensure the victim's well-being, sided with the insurance company's argument that its role is limited to pecuniary compensation.

Recognizing the victim's significant disability and need for future mobility, the Supreme Court took it upon itself to compute the monetary equivalent of these needs. After estimating the cost and replacement frequency of prosthetic limbs (approximately Rs. 2 lakhs every five years, totaling Rs. 10 lakhs for five limbs) and wheelchairs (approximately Rs. 40,000 every five years, totaling Rs. 2 lakhs), the Court directed the insurance company to pay an additional Rs. 12 lakhs to the victim. This amount is to be paid with a simple interest of 6% within two months.

The Court emphasized that this decision, while increasing the compensation, is a re-computation into monetary terms rather than an "enhancement" in the traditional sense, particularly since the insurance company had accepted the original Tribunal award. Given that the accident occurred nearly a decade and a half ago, the Court deemed a remand unnecessary and instead settled the matter to ensure prompt relief for the victim.