UNITED INDIA INSURANCE CO. LTD. versus K.M. POONAM & ORS.

UNITED INDIA INSURANCE CO. LTD. versus K.M. POONAM & ORS.

The insurer's liability under the Motor Vehicles Act, 1988 is restricted to the number of persons permitted by the insurance policy; however, to serve justice, the insurer must pay compensation to all claimants and may recover amounts paid beyond policy limits from the vehicle owner without a separate suit.

Parties
Appellant: United India Insurance Co. Ltd.; Respondents: K.M. Poonam & Ors.; Owner of the Vehicle (respondent No.5): Surdeep Gusain
Jurisdiction
India
Judgment Date
18 February 2011
Procedural Posture
Civil Appeal / Final Disposal
Outcome
Appeals disposed of
Legal Topics
Liability of Insurer, Compensation for Accident, Motor Vehicles Act, Third Party Risk, Breach of Insurance Policy Conditions, Apportionment of Compensation
Motor Accident Compensation Insurance Law Liability of Insurer Compensation for Accident Motor Vehicles Act Third Party Risk Breach of Insurance Policy Conditions Apportionment of Compensation

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Parties

United India Insurance Co. Ltd.

Appellant

K.M. Poonam & Ors.

Respondents

Surdeep Gusain

Owner of the Vehicle (respondent No.5)

Procedural Posture

Civil Appeal / Final Disposal

Legal Issues

  1. 1 Whether an insurer is liable to pay compensation for passengers travelling in excess of the permitted number under the insurance policy
  2. 2 How compensation is to be apportioned when passengers exceed policy limits

Ratio Decidendi

The insurer's liability under the Motor Vehicles Act, 1988 is restricted to the number of persons permitted by the insurance policy; however, to serve justice, the insurer must pay compensation to all claimants and may recover amounts paid beyond policy limits from the vehicle owner without a separate suit.

Court Disposition

Appeals disposed of

Orders

  • Insurance Company directed to deposit total compensation awarded to claimants.
  • Compensation to be disbursed to claimants by Tribunal.