Manifold Advisory

Addressing third parties is the main issue in many countries because every Government is concerned with road accidents and binging different types of measures and enactments (laws/rules regulations) to control road accidents and pay compensation. In our country, there is no limit on compensation payable for death and injury cases and claimants can ask for any amount, however, courts will award the compensation as per guidelines and trends prevalent in the country considering various facts like the status of the person involved into accident, age, and dependency factor, etc. How to calculate, we will discuss herein in the next chapters. As per law insuring a vehicle against a third party is mandatory and it protects the vehicle owner for an unlimited amount ( in case of death and injury of a third party) and protects the insured from causing third-party property damages also to the extent of Rs 6000. In case

Third-party property damage extension: The required minimum amount is Rs 6000 but if someone is held responsible for causing more damage to the property the insured will have to pay for it more than Rs 6000 from his pocket. The insurance company is giving a higher limit of Rs 75000 (total property damage on payment of the additional premium ) for all vehicles except two-wheelers where the extension is available up to one lakh only for property damage. Rs 6000 property damage which is mandatory is covered automatically under third-party motor insurance which please note.

The liability for the third party is based upon the law of tort (tort means civil wrong, so it is a kind of tortious liability that arises against the driver and owner and also against the insurance company for causing accident and for causing injury/death or property damage to the third party. In Germany, negligence of motor vehicles is to be proved the compensation is either a lump sum or step by step (annuity/installments) for the whole life of the victim of road accidents. In England-MIB Motor Insurance Bureau is formed to pay compensation to third parties for uninsured vehicles or hit-and-run accidents. In India, we have the solatium fund created by Governments and all insurance companies for such hit-and-run accidents (the Central Government and State governments contribute 30% and Insurance Companies contribute rest 70% fund required for the solatium fund) To monitor the solatium fund in India, Collector has been empowered to appoint a claims settlement commissioner who after receipt of application for hit and run accident would investigate the matter in 15 days and will pay from solatium fund to the victim of road accident if everything is ok. It may happen that after payment under the solatium fund scheme, the details of the vehicle are surfaced and the victim approaches MACT court and suppose gets an award, then whatever is received under the solatium fund scheme shall be deducted from the award amount.