The top court stated that the benefit received under a Mediclaim policy flows from premiums paid by the insured person over a period of time.
Image: IANS
The Supreme Court on Friday, May 15, said amounts that accident victims receive under medical insurance policies cannot be deducted from compensation awarded under the Motor Vehicles Act (MVA).
A bench of Justices Sanjay Karol and Vipul M. Pancholi dismissed the appeal from New India Assurance Company Limited that had challenged an order from the Bombay High Court, which earlier held that reimbursement of medical expenses received by a claimant via Mediclaim policy cannot be deducted while calculating compensation in motor accident claims, IANS reported.
Advertisement
The top court stated that the benefit received under a Mediclaim policy flows from premiums paid by the insured person over a period of time. It added that this cannot reduce the statutory entitlement to “just compensation” under the MVA.
Advertisement
“In fine, we hold that the amount received as part of Mediclaim/medical insurance is not deductible from compensation as calculated by the concerned Tribunal,” the Bench observed.
Further, it was clarified that compensation under the MVA as well as benefits arising out of a Mediclaim policy “stand on a different footing”.
“One is statutory while the other is contractual and the latter is only a sequitur of premiums having been paid in the past while the other is an entitlement as a consequence of an accident or death in a motor vehicle accident,” the bench observed, according to IANS.
The matter came up over a conflict of judicial opinions across various High Courts on whether claimants can receive compensation under both heads without resulting in a “double benefit”.
The insurance company argued that after medical expenses were reimbursed through a Mediclaim policy, awarding the same amount again under the MVA amounts to duplication and unjust enrichment.
However, the Supreme Court observed that Mediclaim policies are independent contractual arrangements entered into by individuals after paying premiums. It added that these cannot be equated with statutory compensation payable for injuries caused in motor accidents.
“A Mediclaim policy is a policy that is purchased by a person, accounting for the uncertainties of life and preparing a financial base for an unfortunate possible eventuality… In today’s time, when medical expenses are skyrocketing for a variety of reasons, the ability to meet such expenses, suddenly as and when they may arise, is not something that rests with all,” it stated.
Advertisement
