Motor accident compensation must reflect functional disability, not merely medically certified impairment.

Two claimants were injured in a scooter collision on 22 October 2016. Sunil Kumar, then aged 43 and a pillion rider, suffered severe head and other injuries; Sreejith K.S., then aged 22 and the scooter’s driver, suffered serious fractures and a brachial plexus injury.

The Tribunal awarded Sunil ₹19,91,954 and Sreejith ₹16,03,400. The Kerala High Court enhanced those awards to ₹36,22,644 and ₹27,70,664 respectively, but both claimants appealed seeking further enhancement.

The Supreme Court considered, among other matters, the appropriate functional disability and compensation for attendant care and future medical needs.

1. Whether the claimants’ functional disability and consequent loss of earning capacity should be assessed at a higher percentage than the medical disability certified by the Medical Board.

2. Whether attendant or bystander charges should be calculated by applying the multiplier method, and whether further compensation was warranted under other heads.

In assessing permanent disability compensation, medical disability and functional disability are distinct: compensation must reflect the injury’s effect on the claimant’s daily life, occupation and earning capacity, rather than mechanically adopting the medical percentage (Shankar Dutt v. United India Insurance Co. Ltd.; Jithendran v. New India Assurance Co. Ltd.; Reliance General Insurance Co. Ltd. v. Priyanka Das).

The multiplier method applies to attendant charges for a claimant requiring long-term care, as well as to loss of earning capacity (Kajal v. Jagdish Chand; Gobald Motor Service Ltd. v. R.M.K. Veluswami; Hansraj v. Mukesh Nath).

The Court also relied on Ramachandrappa v. Manager, Royal Sundaram Alliance Insurance Co. Ltd. for assessing notional income and Sarla Verma v. Delhi Transport Corporation for the multiplier applicable by age.

It referred to Raj Kumar v. Ajay Kumar in recognising compensation for loss of marriage prospects.

For Sunil, the Court found that his severe head injuries and resulting dependence on lifelong assistance rendered his functional disability total, notwithstanding the Medical Board’s 75.5% medical-disability assessment. It therefore assessed loss of earning capacity at 100%, using his monthly income of ₹15,000, 25% future prospects and multiplier 14.

Given his need for continuing care, the Court applied the multiplier method to attendant charges, awarding ₹25,20,000.

For Sreejith, the nature of the injuries and their effect on his arm and earning capacity justified functional disability of 80%, rather than the certified medical disability of 62%; the Court applied his notional monthly income of ₹10,500, 40% future prospects and multiplier 18.

It also applied the multiplier method to his attendant charges and awarded amounts for future medical expenses and loss of marriage prospects.

The additional compensation was to carry interest at 6.5% per annum from the date of filing of the respective claim petition until realisation; the insurer was directed to deposit the additional amounts with interest before the Tribunals within six weeks, for disbursement to the claimants.