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Wakia Afrin (Minor) v. M/S National Insurance Co. Ltd.

Special Leave Petition (Civil) · 2025 INSC 919Decided 1 Aug 2025
SLP(C) No.-015447-015448 - 2024
Justice Sudhanshu Dhulia

Background

A two-year-old girl lost both her parents when the vehicle they were travelling in, owned and driven by her father, went out of control after a tyre burst and crashed. Her aunt filed a "no-fault liability" compensation claim on her behalf under Section 163A of the Motor Vehicles Act against her deceased father's estate and the insurer. The Tribunal awarded compensation for both parents' deaths, but the High Court threw out the claims on the technical ground that a dead person (the father) could not be named as a party, and separately questioned whether a daughter who inherits her father's estate could also claim compensation for his death.

Decision Breakdown

The Supreme Court held that the High Court's technical objection was wrong, under Section 155 of the Motor Vehicles Act, an insurance claim survives even after the insured person's death and can be pursued against the insurer. The Court restored the compensation award for the mother's death without difficulty. However, on the harder question, whether a claim can be paid for the death of the vehicle's own owner-driver under Section 163A, given conflicting precedent from various two-judge Supreme Court benches. The Court disagreed with the existing view that such "no-fault" claims are limited to third parties only, and held that Section 163A's non-obstante (overriding) clause should cover the owner's death too. Because this conflicts with prior two-judge bench rulings, the Court referred the specific legal question to the Chief Justice of India for consideration by a larger bench, rather than deciding it finally itself.

Lesson Learnt

A person's death does not automatically end an insurance compensation claim connected to them, and family members are not barred merely because they would also inherit the deceased's assets, but the exact scope of "no-fault" compensation claims for a vehicle owner's own death remains legally unsettled and now awaits a larger bench's ruling.

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

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