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Suresh Chand Yadav was a bus driver employed with the Rajasthan State Road Transport Corporation (RSRTC). He was covered under a Group Personal Accident Insurance Policy taken by his employer from Cholamandalam General Insurance. According to the scheme of the policy, in the event of permanent total disablement, the insured would get a total compensation of Rs 2 lakh divided into instalments payable over a period of 12 consecutive months. The policy defined total and permanent disablement to mean a disability in which the insured would be unable to engage in each and every occupation or employment for compensation or profit, for which he was reasonably qualified by education, training or experience. Besides this, the policy also provided for payment of compensation in case of permanent partial disablement where the benefit would be restricted to 50 per cent of the coverage limit.
Yadav was on duty, driving a bus, when he met with an accident. He was seriously injured, and one leg had to be amputated. He lodged a claim for payment of Rs 2 lakh as compensation for permanent total disablement, but the insurer paid only Rs 1 lakh considering it to be permanent partial disability. Aggrieved, Yadav filed a complaint before the District Forum alleging deficiency in service.
The insurer contested the complaint, contending that the claim was settled properly in accordance with the terms of the policy. The Forum held that Yadav had suffered permanent total disability and was entitled to Rs 2 lakh. So it directed the insurance company to pay the remaining Rs 1 lakh along with interest at 15 per cent per annum. Yadav was also awarded Rs 21,000 for harassment and mental agony.
The insurer’s appeal against this order was dismissed by the Rajasthan State Commission. Cholamandalam questioned the orders through a revision petition.
The National Commission observed that the only question for consideration was whether the amputation of one leg had resulted in permanent total disablement or not. The Commission considered the provision of the Workmen’s Compensation Act which defines total disablement to mean such disablement, whether of a temporary or permanent nature, which would incapacitate a workman for all work which he was capable of performing prior to the accident. It relied on the Supreme Court’s judgement in Pratap Narain Singh Deo versus Srinivas Sabata & Anr, where a carpenter had lost his left hand from the elbow and had become unfit for the performing his occupation was held to have suffered total disablement.
The Commission observed that permanent total disability would have to be determined in the context of the loss of future earning capacity. So the same disability may affect different people in different ways depending on their work.
The National Commission observed that Yadav would no longer be able to drive a bus after the amputation of one leg. Hence it was wrong of the insurance company to consider Yadav’s disability to be partial. The Commission concluded that Yadav was entitled to the entire amount of Rs 2 lakh. By its order of January 9, 2017 delivered by Justice V K Jain, the National Commission upheld the orders passed in Yadav’s favour and dismissed Cholamandalam’s revision.
The author is a consumer activist