Medical expenses reimbursed under health insurance cannot be deducted from motor accident compensation.

The appellant, whose 19-year-old daughter died in a road traffic accident on 20 August 2023, appealed under Section 173(1) of the Motor Vehicles Act, 1988, seeking enhancement of the compensation awarded by the MACT, Bengaluru

The Tribunal awarded ₹38,64,000, including ₹37,80,000 for loss of dependency, but did not award ₹25,760 in medical expenses because those expenses had been reimbursed under a health insurance policy

The appellant also challenged the monthly income assessed for the deceased, relying on her studies and an asserted campus placement package; however, no document substantiating the placement or package was produced

Section 173(1) of the Motor Vehicles Act, 1988 provides for an appeal against an award of a Claims Tribunal

Relying on New India Assurance Company Limited v. Dolly Satish Gandhi & Anr., 2026 INSC 498, the Court applied the principle that medical expenses reimbursed through a health insurance policy cannot, on that account, be deducted from the medical expenses claimed in a motor accident compensation proceeding

In assessing dependency compensation, the Court accepted the Tribunal’s calculation based on the deceased’s assessed income, a 40% addition for future prospects, a 50% deduction for personal expenses, and multiplier 18

The Court found no basis to increase the deceased’s assessed monthly income: although the appellant relied on an alleged campus selection and annual package of ₹4,90,000, the only relevant document produced was a study certificate, and there was no documentary evidence of the selection or package

It therefore upheld the Tribunal’s assessment of ₹25,000 per month and its calculation of loss of dependency, as well as the amounts awarded for consortium, loss of estate, and funeral expenses

However, applying Dolly Satish Gandhi, the Court held that reimbursement by the deceased’s health insurer did not justify excluding the ₹25,760 in medical expenses from the award

The Court awarded the appellant an additional ₹25,760, with interest at 6% per annum from the date of the petition until realization

The insurer was directed to deposit the enhanced amount with the Tribunal within six weeks, and the appellant was entitled to release of the entire enhanced compensation with interest