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National Insurance Co. Ltd. v. Ashalata Bhowmik and Ors.

Civil Appeal · 2018 INSC 776Decided 31 Aug 2018
Civil Appeal No. 9100 of 2018
Justice N.V. Ramana · Justice S. Abdul Nazeer

Background

Dilip Bhowmik, the owner-cum-driver of his own vehicle, died in a road accident in Tripura caused by his own rash and negligent driving: no other vehicle was involved. His mother, wife and children filed a compensation claim under the Motor Vehicles Act, and the Tribunal awarded them Rs.10,57,800. The High Court agreed that the deceased was not a "third party" under the Act (since he caused his own death) but still directed the insurer to pay, relying on a personal-accident cover in the policy limited to Rs.2,00,000, while stating its order should not be treated as a precedent.

Decision Breakdown

The Supreme Court held that a person who dies solely because of his own negligent driving, with no other vehicle involved, is not a "third party" under the Motor Vehicles Act, and his legal heirs cannot maintain a claim against the insurer on the basis of his own fault, relying on its earlier decision in Oriental Insurance Co. Ltd. v. Jhuma Saha. However, since the insurance policy itself contained a separate personal-accident cover for the owner-driver limited to Rs.2,00,000, which was undisputed, the Court held the insurer liable only to that extent. The appeal was allowed in these modified terms: the insurer was directed to deposit Rs.2,00,000 with 9% interest from the date of the claim petition, instead of the larger sum awarded by the Tribunal.

Lesson Learnt

An insurer is not liable under third-party motor insurance for a vehicle owner's own death caused by his own negligent driving; such a claimant's family can recover only what is specifically covered under a separate personal-accident clause in the policy, and only up to that clause's own limit.

Official source (sci.gov.in)View Judgment (PDF)

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