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The following changes introduced by the 2019 amendment with respect to insurance and claims will come into effect from April 2022
The following changes introduced by the 2019 amendment with respect to insurance and claims will come into effect from April 2022
Time-limit of six months for filing claim
Sub-section(3) proposed to be added to Section 166 states that
the claim petition has to be filed within six months of the date of accident.
In the original Act passed in 1988, there was a similar provision. But the said
provision fixing time limit was deleted as per 1994 amendment. Therefore, a
claim could have been filed at any time, without any limitation. Now, that
provision has been brought back.
Survival of claim to the estate of claimant after his death
As per the present law, a claim for personal injury would abate
on the death of the claimant, and would not survive to his estate, due to the
operation of Section 306 of the Indian Succession Act. The claim would survive
to the estate only if death had nexus with the injuries, and only in such cases
the legal heirs would be entitled to come on record and continue with the
prosecution of the claim.
The amendment remedies that situation, bv incorporation a new
sub-section, Section 166(5), with a non-obstante clause which says that the
right of a person to claim compensation for injury in an accident shall, upon
the death of the person injured, survive to his legal representatives,
irrespective of whether the cause of death is relatable to or had any nexus
with the injury or not.
Hit and Run Scheme
The compensation payable for victims in 'hit and run' out of the
scheme fund under Section 161 has been enhanced to Rs. 2 lakhs in case of
death, and Rs. 50,000/- in case of bodily injury, from Rs.25,000/- and
Rs.12,500/- respectively.
Motor Vehicle Accident Fund
The Bill seeks to introduce a Motor Vehicle Accident Fund under
Section 164B, which is to be augmented by a special tax or cess. The Fund is to
be utilized for giving immediate relief to victims of motor accidents, and also
hit and run cases. The compensation paid out of the fund shall be deductible
from the compensation which New provisions of the Motor Vehicles Act relating
to third party insurance and filing of claims before Motor Accident Claims
Tribunal will come into force from tomorrow, April 1, 2022.
The Central Government has notified that Sections 50 to 57 and
93 of the Motor Vehicles (Amendment Act) 2019 will come into force with effect
from April 1, 2022.
A notification issued by the Ministry of Road Transport and
Highways on February 25 stated :
These provisions also made substantial amendments to Sections
163, 166, 168 and 169 of the MV Act 1988 in relation to the filing of claims
before Motor Accidents Claims Tribunal.
Section 161 inserted to the 1988 Act via Section 50 of the 2019
Amendment Act, which provides for increased compensation in cases of hit and
run, also gets operationalised with effect from April 1.2022
Section 93 of the 2019 Act omits the second schedule of the 1988
Act which provided for structure formula for compensation on no-fault basis
under Section 163A.
Enabling insurer to seek exoneration from liability for
non-receipt of premium
The amendment makes non-receipt of premium one of the specified
conditions, which would enable the insurer to seek exoneration from the
liability., by virtue of new provision Section 1502(c).
The Amendment replaces Section 163A with Section 164. The
structured formula system of payment of compensation envisaged by Section 163A
of the earlier Act on the basis of Second Schedule is sought to be repealed.
The Second Schedule is also sought to be taken away. This provision contemplates
payment of rupees five lakhs in cases of death, and rupees two lakhs and fifty
thousand in cases of grievous hurt.
Newly added proviso in Section 165(1) states that acceptance of
payment of compensation under Section 164 will result in lapse of claim petition.
Therefore, the maximum amount a claimant can get on no-fault basis is Rupees 5
lakhs in case of death and rupees two and a half lakhs in cases of grievous
hurt.
Second Schedule omitted
Section 93 of the 2019 Amendment Act say that in the principal
Act, the Second Schedule shall be omitted. The Second Schedule provided for
structured formula of compensation on no-fault basis under Section 163A.
Time-limit of six months for filing claim
Sub-section(3) proposed to be added to Section 166 states that
the claim petition has to be filed within six months of the date of accident.
In the original Act passed in 1988, there was a similar provision. But the said
provision fixing time limit was deleted as per 1994 amendment. Therefore, a
claim could have been filed at any time, without any limitation. Now, that
provision has been brought back.
Survival of claim to the estate of claimant after his death
As per the present law, a claim for personal injury would abate
on the death of the claimant, and would not survive to his estate, due to the
operation of Section 306 of the Indian Succession Act. The claim would survive
to the estate only if death had nexus with the injuries, and only in such cases
the legal heirs would be entitled to come on record and continue with the
prosecution of the claim.
The amendment remedies that situation, bv incorporation a new
sub-section, Section 166(5), with a non-obstante clause which says that the
right of a person to claim compensation for injury in an accident shall, upon
the death of the person injured, survive to his legal representatives,
irrespective of whether the cause of death is relatable to or had any nexus
with the injury or not.
Hit and Run Scheme
The compensation payable for victims in 'hit and run' out of the
scheme fund under Section 161 has been enhanced to Rs. 2 lakhs in case of
death, and Rs. 50,000/- in case of bodily injury, from Rs.25,000/- and
Rs.12,500/- respectively. Also read - Hit-And-Run
Cases : Provisions Giving Increased Compensation To Come Into Effect From April
1, 2022
Motor Vehicle Accident Fund
The Bill seeks to introduce a Motor Vehicle Accident Fund under
Section 164B, which is to be augmented by a special tax or cess. The Fund is to
be utilized for giving immediate relief to victims of motor accidents, and also
hit and run cases. The compensation paid out of the fund shall be deductible
from the compensation which the victim may get in future from the Tribunal.
Limited Liability in no-fault cases
By Prem Lata
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