TP CLAIMS PROCEDURE

 Claim on insured thru’ Motor Act Claims

Tribunal(MACT) lodged by claimant(injured/heir of
deceased) using a lawyer
 Claim filed as suit, imp leading insured and insurer
 On receipt of notice from MACT, a claim is registered by
Insurer indicating the claim no. , Poliy no., Insured’s
name, vehicle no. , date of accident, Driver, name of the
claimant, fatal claim or injury claim
 Insurer appoints lawyer to represent both insured and
insurer and the same is noted in the claim register
 Insurer call for the various information in regard to the
OD claim and TP claim
 TP CLAIMS PROCEDURE…
 Documents called for from the insured -
 Policy no. under which vehicle was covered
 Details of OD claim if any, its claim no.
 FIR details and police station where the case was
registered
 Driver’s name and address
 Insured’s advocate details
 Details of driver’s convictions, copy of charge sheet and
the Court
 Claim form dully filled in by the insured
 All relevant documents to be submitted by insured are
verified by insurer
 Necessary copies of police report, panchnama and
statements made to police relating to accident are called
from the police station
 TP CLAIMS PROCEDURE…
 Liability of Insurer depends upon-
 The validity of insurance covering the involved
vehicle on the date of accident
 The limit of liability under the policy
 Driver’s statement and statements of the witnesses
to the accident
 Details of Driver’s prosecution, charges proved
and judgment in the criminal case
 Proof of Contributory negligence of affected
person
 Defense under section 149(2) of MV Act, 1988
 TP CLAIMS PROCEDURE…
 Information about the affected person-
 Post-mortem Report in case of fatal claims
 Medical report in case of injury
 The age of the claimant and his general physical
condition
 Occupation/ status, monthly income, dependants
 Nature and extent of injuries
 Disability- duration of temporary disability
 Extent of permanent disability
 Opinion of independent medical examiner
 TP CLAIMS PROCEDURE- Insurer to Act
 Verification of RC, Fitness, use of vehicle and DL if not
verified for OD claim. If documents found invalid then
insured is liable for OD and TP claim and recovery can be
pursued against him

 Negligence of the driver or affected TP is relevant to fix the

responsibility

 OD survey report and claim form to be checked as they

indicate the circumstances of the accident and TP damages

 Relevant supporting documents to the TP claim to be

submitted in court by claimant
 Strategy of defense in the Court is discussed with the
advocate
 TP CLAIMS PROCEDURE- Insurer to Act
 Verification of police findings, existence of the
claimant injured or legal relation with deceased
and to pursue for out of court settlement.
 Award passed by court-generally principal
+interest, etc

 Out of court/compromised settlements possible

 Lok Adalats, special courts set up for speedy

settlement

 Claim payments made by insurer may include

award+interest+legal fees+legal and other costs
‘DON’TS’IN MOTOR CLAIMS
 Leave the accident vehicle unattended at
spot of accident

 Make any compromise/payment with any

third party

 Proceed with repairs before surveyor’s visit

& assessment
 Negligence
 TPL arises due to negligence by driver or by
use of the vehicle.
 Negligence is breach of general duty towards
the members of society
 Reckless driving
 Ignoring traffic rules and saftey of pedestrians
 Defective vehicles, non-maintenance of
vehicle
 Leaving motor vehicle unattended on road or
unsafe
 TPL- claimants
 Pedestrians
 Fare-paying passengers of the vehicle
 Non-fare paying passengers- goods owner’s
 Persons in the other vehicle
 Children- extra care
 TPL - Proof of Negligence
 A) Res Ipsa Loquiture- Things speaks for
itself
 Circumstantial evidence- indicate that there has
been prima facie negligence and claimants need
not prove negligence. The moved to pavement.
 The onus of proof shifts from the claimant to the
driver to prove that he was not negligent
 B) Strict liability- If a vehicle is moving or
stationery and accident is caused, the onus is
on the insured to prove that the claimant was
negligent
 How to rebut alleged negligence
 No fault Liability- Sec. 140- Death & PD- No defense
 Sec. 141- Claim can also be pursued under other provisions
of Act.
 Sec. 142- Permanent disablement (privation or permanent
impairment of limbs or disfiguration of the head or face)
 Limitations:
 Compensation amount is limited – Rs.50,000 in case of Death &
Rs.25,000 for permanent disablement
 No claim for injury;
 Claim can be either made under Sec. 140 or any other provision or any
other Act.
 Amount paid u/s 140 is to be reduced from the Claim amount payable
under any other provision or other Act
 How to rebut alleged negligence….
 Fault or strict Liability- Sec. 163A: Ryland V.
Fletcher (1868)- owner is responsible for any
loss/liability caused by use of his vehicle. However
the following defenses are available:
 Volenti Non-fit Injuria- voluntary consent to run a
risk, the question of negligence does not arise,
Boarding in or setting down from a speeding bus, etc.
 Inevitable Accident- Despite caution, skill and
reasonable care the accident occurred. It is to be
proved by the driver, to jumb before a moving vehicle
to commit suicide, etc
 Act of God- Storm, earthquake, storm, etc.
 How to rebut alleged negligence….
 Emergency- when the injured person has placed
himself in endangered position, no negligence- In
order to save a pedestrian crossing the road, the
vehicle strayed on the left causing accident to a
cyclist
 Contributory negligence by claimant- the
compensation shall be reduced according to the
degree of blame attached to such person, the
pedestrian crossing the road despite redlight for the
pedestrians
 These defenses are available to the insured.

 The defenses available to the Insurer are Sec. 149(2)

and 170
 Sec. 149(2) MV Act 1988 says the the Insurer shall be given
 How to rebut alleged negligence- Provisions of Defense of
Claims for Insurer before MACT

 Sec. 149(2) of MV Act, 1988

 (a) Breach of conditions of policy- To be
proved
 Driver not holding a Valid D/L or disqualified
 Use of vehicle other than permitted-
 Use for hire or reward, when not permitted
 Organised racing or speed testing

 Transport vehicle in use against the permit

 M/cycle when without side car

 Provisions of Defense of Claims for Insurer before
MACT….
 (b) The policy is void on the ground of non disclosure
of a material fact or misrepresentation of material
fact- to be proved
 Contributory negligence of victim or deceased in-
fault liability
 The insurer can request MACT to implead u/s 170
 Sec. 170, if MACT is satisfied that -
 (a) there is collusion between the insured and the
claimant, or
 (b) the insured has failed to contest the claim
 MACT can direct that the Insurer shall be impleaded
as a party to the proceedings and may contest the
claim on merits
 TP Liability - Damages
 Monetary compensation recoverable by the injured
party- called as damages (compensation)
 Special Damages – Actual financial loss or expenses
resulting from Accident, supported with bills, e.g.
 medical, surgical, hospitalization expenses,
 loss of salary and income, funeral expenses
 General Damages – Injuries: Compensation for pain
and sufferings, nervous shock, mental agony
 Loss of expectation of life
 Loss of amenities of life, loss of enjoyment of life,
 physical disability, loss of promotion,
 loss of matrimonial prospects, facial disfigurement, etc.
 General Damages…….
 Death-
 Loss to the dependants : financial support,
 Loss to the estate of deceased : loss of savings,
business
 pain suffering uptill death and
 Loss of expectation from life
 Assessment is based upon
 English case Davies Vs. Powell. Annual
dependency amount(on dependants) X factor(12-
15), or
 Nance’s method. Annual loss to dependant( annual
income – expenses on self and adjustment for
other factors) X multiplier
 General Damages……
 Disability-
 Pain and suffering and loss of amenities of life
 Financial loss and expenses incurred,
 loss of earning capacity
 Assessment of damages – no formula but
based upon:
 West & Sons Ltd. Vs. Shepherd (1964) and
Vinod Kumar Vs. Ved Mitra
 Damages vary according to the gravity of injury
 Damages should be reasonable and comparable
 Property damage
 Property Damages:
 Property damaged: Cost of repairs,
depreciation in value of property due to
accident and cost of hiring alternative
accommodation
 Property Destroyed: Value of property on the
date of accident and reasonable consequential
loss -like alternative property, loss of profit
 Knock for knock agreement
 An accident where two vehicles collided are insured
 The negligent owner shall be sued under TP liability
 To avoid the hassles of claiming as TP, Insured prefer to
claim from his own insurer and the right to recover against
negligent owner are transferred to insurer
 The other owner (negligent) is also insured and his insurer
shall pay TP claim
 The claim in such cases shall be settled between respective
insurers
 The negligence of each owner- insured is to be proved
through litigation and degree of negligence is to be
established
 Litigation is time consuming and expensive,
 It increases the claim cost and reflected in premium rating
 To avoid all these, Insurers entered into agreement to settle
Claim of their own vehicles provided both are insured
 The agreement is not related to Goods carriage and
Passengers carriage vehicles.
 Loss Control measures - OD
 Immediate appointment of surveyor by the in-
charge of DO or Branch for losses exceeding
Rs.20,000
 The Surveyor should have Automobile
qualification/Automobile Engineer and
experienced of assessing motor accident claims
 Photographs taken by surveyor should have
signature of surveyor and date
 Estimates should be from the authorised
workshop
 In case of major loss, the In- charge of DO/ BO
should make surprise visits to find the estimate of
loss
 Same surveyor should not survey further loss
under the same policy
 Loss Control measures…..
 Survey of taxis and commercial vehicles should
also be examined by the Company engineers
during repairs and also conduct surprise
inspection
 Work allocation to surveyor should be on rotation
basis
 Surveyors should be changed after 02 yrs.
 The selection of competent motor surveyor should
be carefully made by Empanelment Committee
 Surveyors should deduct appropriate salvage
value for the damaged parts from the assessed
amount
 Loss Control measures…..
 Final Survey-
 Final survey should be done only at the workshop
which prepared the estimate
 Under insurance should be taken seriously
 For commercial vehicle the surveyor should
mention material cost and labour charges
separately for cabin and for body
 Major parts should be identified, like chassis,
front axle, etc and mentioned in the report
 Re-inspection of replacement of parts after repairs
carried should be done by any other surveyor
 Loss Control measures…….
 Role of Surveyor is very important
 He should visit the workshop during repairs are being
carried out
 Scrutinise the bills for their authentic value
 In case of valid doubts or assessment on higher side,
another surveyor can be deputed to examine or reassess
the loss.
 Appropriate action should be taken against the erring
surveyor
 Insurer’s own claim engineer should monitor the motor
claims, survey reports, loss assessments.
 Major claims should be intimated to Regional office and
Insurer’s claim engineer should be involved with the
deputed surveyor for loss assessment.
 Motor claims should be subject to technical audit and
surprise visits at workshops
 Loss Control measures…..
 Salvage Value-
 Salvage of total loss vehicles which are beyond repairs
should be disposed off and RC book and other documents
surrendered to RTA
 Salvage of uneconomical repair vehicles should be sold
with RC book
 Assessment of Salvage value should be appropriately done
to minimise the losses
 Loss Control measures - TP
 On getting information or FIR, investigation should be got
conducted through ex-police officer to find the
circumstances, evident and cause of accident
 The correctness of insurance policy and vehicle particulars
should be checked carefully and got verified from
concerned RTA
 Relevant information about the Persons affected by
accident, their income, status, family members, dependants
and earning members should be gathered
 Out come of investigations carried out by Police should be
obtained
 A panel of Advocates ( 3 to 8) of good standing and
experience not less than 5 yrs should be utilised to defend
the TP cases on behalf of Insurer
 Loss Control measures-TP….
 TP cases should be allotted on rotation basis
 Not more than 10 cases should be pending with an
advocate
 Investigation Report arranged by Insurer and
necessary copies of Insurance policy, driver and
vehicle particulars should provided to advocate
 The incharge of the Insuring office should monitor
the development of the legal case. The strategy of
defence should be discussed with the advocate
from time to time.
 Loss Control measures- TP…..
 Defence in MACT-
 A written statement in regard to defence of the case should
be submitted by advocate to Divisional Incharge discuss
the case
 Breach of policy conditions,
 D/L particulars
 Sec. 149 (2)
 Sec. 170
 The negligence on the part of injured person or deceased
person should be taken up with the Court very carefully
based on evidences to reduce the compensation amount
 Legal officer of the DO/RO should attend the proceeding
of the TP cases in the MACT court and assess the
performance of advocates
 Loss Control measures- TP….
 Settlement of Award-
 Awards under the No fault or negligent liability
should be deposited with the Court at the earliest
before 30 days of the award to avoid interest
payment on award amount.
 Appeal against the MACT award may be filed
when the award amount is unreasonable, more
than 01 lacs and substantial points of law are
available to defend the case.
 Loss Control measures- TP….
 Out of Court Settlement-
 The pending TP cases should be scrutinised from
time to time and cases where the liability of
Insurer is beyond doubt, should be taken up in
Lok Adalat
 More and more cases should be taken in Lok
Adalat to compromise at minimum compensation
and also reduce the legal expenses and interest
amount
THANK YOU