[MV Act] Insurer Charging Additional Premium For Employee Can't Deny Liability To Compensate For Hired Driver's Death Citing Negligence: Jharkhand HC

In an important order, the Jharkhand High Court has held that an insurance agency is liable to pay compensation for a motor vehicle accident claim for a hired driver in the event of his death, even if the accident is caused due to the driver's negligence. This liability arises once the insurer has accepted additional premium to cover indemnity of vehicle owner.Justice Pradeep Kumar Srivastava observed, “In view of the above discussion and reasons, I am of the definite opinion that the insurance company is liable to pay the compensation for a Motor Vehicle Accident claim for a hired driver in the event of his death, even if the accident is caused due to negligence of the driver. This liability arises once the insurer has accepted additional premium to cover the liability of paid employee and to indemnify the vehicle's owner.”The above ruling came in a miscellaneous appeal preferred under section 173(1) of the Motor Vehicle Act on behalf of the Bajaj Allianz, assailing the award passed by MACT Gumla, whereby the claimants were awarded compensation to the tune of Rs.6,08,540/- along with interest.In the matter at hand, the plaintiff's spouse met with a fatal road accident involving a vehicle covered by the respondent's insurance. The District Judge rendered a decision granting compensation amounting to Rs. 6,08,540, coupled with a supplementary 6% annual interest computed from the initiation of the claim petition on September 20, 2014, until the complete settlement of the sum. The petitioner is presently challenging this judgment through the ongoing appeal process.From perusal of the computerized Insurance Policy which was issued by the appellant in respect of the offending vehicle, the Court noted that it was a comprehensive Private Car Package Policy, in which additional premium was paid for Employee-one person. The Court held, “There is no doubt that the deceased was driving offending vehicle at the relevant time of accident and due to his fault and negligence, the accident resulted in his death. Thus, as per terms and conditions of policy, the insurance company/appellant is liable to satisfy the award amount with interest and then to recover the same from the owner/insured.”Accordingly, the appeal was dismissed.Appearance :For the Applicant: Mr. Alok Lal, Nr. Santosh KumarFor the Respondent: Mr. Kripa Shankar Nanda, Mr. N.K SinhaCase Title: Branch Manager, Bajaj Allianz General Insurance vs. Binita Toppo and othersLL Citation: 2024 LiveLaw (Jha) 5Case No.: M.A. No. 218 of 2018Click Here To Read / Download Judgement

[MV Act] Insurer Charging Additional Premium For Employee Can't Deny Liability To Compensate For Hired Driver's Death Citing Negligence: Jharkhand HC

Bhavya Singh

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