Under IMT 17, the insurer must satisfy the paid driver’s compensation award despite self-negligence.

The claimant-appellant challenged the judgment and award dated 6 March 2017 passed by the Motor Accident Claims Tribunal (Main), Vadodara in MACP No. 2008 of 1998.

The Tribunal awarded compensation of ₹1,60,800 with interest at 7.5% per annum, but directed the respondent-insurance company to pay only ₹90,000 and ordered recovery of the balance ₹70,800 from the vehicle owner, principally on the finding that the claimant himself was negligent.

The claimant contended that the insurer had collected an additional premium of ₹105 under IMT 17, thereby covering the risk of the paid driver.

The insurer disputed liability beyond ₹90,000 and argued that the claimant’s risk was not covered under IMT 17.

Whether, upon charging an additional premium under IMT 17, the insurance company was liable to indemnify the insured and satisfy the compensation awarded to the paid driver despite the claimant’s own negligence.

Whether the Tribunal was justified in directing the insurance company to satisfy only ₹90,000 of the award and recovering the remaining ₹70,800 from the vehicle owner.

The Court applied IMT 17 of the Indian Motor Tariff, 2002, which provides personal accident coverage for paid drivers, cleaners and conductors upon payment of an additional premium, subject to the terms and limits of the policy.

It relied on the Full Bench decision in Valiben Laxmanbhai Thakore (Koli) & Ors. v. Kandla Dock Labour Board & Anr., reported in 2021 ACJ 2262, which holds that where an insurer accepts additional premium for covering a paid driver or conductor, it is liable to satisfy the claim arising from the death or injury of that person notwithstanding his or her self-negligence.

The policy at Exh. 53 established that the insurer had charged an additional premium of ₹105 under IMT 17, and the Court found that the claimant’s risk as a paid driver was consequently covered.

Applying the Full Bench rule in Valiben Laxmanbhai Thakore, the Court held that the claimant’s negligence did not defeat the insurer’s contractual liability under the additional personal accident cover.

Since the insurer had accepted the additional premium for the relevant risk, the Tribunal erred in partially exonerating the insurer and fastening liability for ₹70,800 upon the vehicle owner.

The insurance company was directed to satisfy the entire compensation of ₹1,60,800, together with interest at 7.5% per annum from the date of filing of the claim petition until realization, instead of paying only ₹90,000.

The insurer was directed to deposit the entire amount within six weeks from receipt of the order.

The Tribunal was directed to disburse the amount to the claimant after due verification and deduction of any deficit court fee, if applicable.