Mediclaim policy amount can't be deducted from medical compensation: HC

A sum received by a person under a mediclaim policy cannot be deducted from the compensation amount payable to the claimant for medical expenses under provisions of the Motor Vehicles Act, the Bombay High Court has said.

The amount under a mediclaim policy is received in view of a contract entered into by the claimant with the insurance company, a full bench of Justices A S Chandurkar, Milind Jadhav and Gauri Godse said in its judgement on March 28.

"In our view, the deduction of any amount received by a claimant under a Mediclaim policy would not be permissible," the bench ruled.

The issue was referred to the full bench after various single and division benches had different views on the same.

The full bench, while referring to judgments passed by the Supreme Court, said the Motor Accident Claims Tribunal was not only empowered but also duty-bound to award just compensation.

It said the amount received on account of insurance is due to the contractual obligations entered into by the insured with the company.

Having paid the premium, it was clear that the beneficial amount would accrue to the share of the claimant either on maturity of the policy or on death, whatever be the manner of death, the court said.

"The tortfeasor (offender) cannot take advantage of the foresight and wise financial investments made by the deceased. This is the settled position of law," the court said.

The full bench was hearing an appeal filed by the New India Assurance Co Ltd against a judgment of the Motor Accident Claims Tribunal awarding monetary compensation up and above the medical expenses.

The insurance company claimed medical expenses were also covered under the insurance money received as part of the mediclaim policy.

The company said this would amount to double compensation.

Advocate Gautam Ankhad, appointed as amicus curiae to assist the court, argued that the Motor Vehicles Act provision pertaining to medical expenses needs to be construed in favour of the claimant/victim as it is a welfare legislation.

He further said there is no loss caused to the insurer as it received premium from the insured.

However, if a deduction is permitted from the medical expenses, then it would result in granting an unjust benefit to the insurer resulting in its unjust enrichment, he said.