Motor Accidents | Standard Multiplier Need Not Be Applied Mechanically When Victim Dies Due To Unrelated Causes: Kerala High Court

The division bench comprising Justice Sathish Ninan and Justice P. Krishna Kumar delivered the judgement while considering a batch of petitions of Motor accident claims appeals.

The Court examined whether, in instances where the claimant later dies from causes unrelated to the accident, the multiplier prescribed in Sarla Verma v Delhi Transport Corporation [2010 (2) KLT 802 (SC)] should be applied.

The bench was considering the reference by the Single Judge, which raised a doubt as to the correctness of decision in Cholamandalam General Insurance Company Ltd. v Shailaja [2021 (3) KLT 371] where it was held that multiplier must not be mechanically adopted when the injured person in a personal injury case dies pending the claim proceedings due to reasons unconnected with the incident.

The Single Judge in the reference order observed that the right to compensation arises the moment the injury occurs, and that a subsequent unrelated death does not affect the substantive right. Hence, the compensation must be determined in accordance with the standardized multiplier method laid down in Sarla Verma and must not be adjusted based on later events.

The order of the single judge further observed that the life expectancy of the victim alone was not the criterion and the multiple method in standardised form was introduced by taking into account several imponderables in life and economic factors relevant to the adjudication of compensation. It was further observed that deviating from this would defeat the purpose of the standardised multiplier method.

The Court observed that the decision in National Insurance Co. Ltd. v Pranay Sethi [(2017) 16 SCC 680], which affirmed the multiplier method laid down in Sarla Verma was intended for fatal accident cases.

“It did not, in fact, prescribe a method for determining the multiplier in personal injury cases.” the bench observed.

The Court further noted that the purpose of prescribing a structured formula was for assessing loss to ensure both uniformity of procedure and parity of treatment.

The Court analysed whether it would be appropriate to resort to standard multiplier method to award disability compensation, when the injured person dies due to cause other than that of the injuries in the accident.

The Court observed that the Supreme Court has laid down law on this aspect in Dhanlal alias Dhanraj (Dead) Through LRs v Nasir Khan and Others [(2025) SCC OnLine SC 2083], where it had reduced the multiplier to correspond with the actual lifespan of the victim, when the death of the injured occurred within a shot duration after the accident due to a cause unrelated to the accident.

It also examined instances where the injured person outlived the number of years corresponding to the multiplier. The Court observed that deviation from the multiplier method may not be warranted in such situations. Reliance was placed in the Supreme Court's decision in Meena (Dead) Prayagraj and others [SLP(C) 12187/ 2019), where, even though the injured survived for nearly 19 years, the Court fixed the compensation by applying a multiplier of 13.

The Court observed that the multiplier method was evolved by taking into account normal life expectancy and several variables in human life, which include the gradual reduction of earning capacity with advancing age.

The Court thus affirmed the correctness of Cholamandalam General Insurance Company Ltd. v Shailaja.

Case Title: The Oriental Insurance Company Ltd v Mini Devdas and Ors. and connected cases

Citation: 2025 LiveLaw (Ker) 751

Case No: MACA 1920/ 2011 and connected cases

Counsel for Appellants: Mathews Jacob (Sr.), P Jacob Mathew, D Kishore,

Counsel for Respondents: P Narayanan, Subhash Cyriac