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The Supreme Court on 14th August has reiterated the insurance claim principle whereby the computation of claim amount is supposed to be done based on age of the deceased and not age of the dependents claiming the insurance.

A bench of Justices Indu Malhotra and Sanjiv Khanna was hearing Joginder Singh v ICICI Lombard arising out of Himachal Pradesh High Court ruling in an insurance claim that the courts below failed to award compensation towards Future Prospects and Loss of Estate. Court accordingly granted compensation under these additional heads.

In a recent 2019 judgment in Royal Sundaram Alliance Insurance Co Ltd. v Mandala   Yadagari Goud & Ors, the apex court has settled that the Multiplier has to be applied on the basis on the age of the deceased. Court quoted itself from Royal Sundaram: “We are convinced that there is no need to once again take up this issue settled by the aforesaid   judgments of three Judge Bench and also relying upon the Constitution Bench that it is the age of the deceased which has to be taken into account and not the age of the dependents.” The erroneous multiplier of 11 to calculate claim amount was thus modified to a Multiplier of 18.

Court also held the “lump sum amount of Rs. 25,000/- towards loss of love and affection” as inaccurate computation since in 2017, the apex court in Magma General Insurance Co. Ltd. v. Nanu Ram & Ors had held that a sum of Rs. 40,000/­ is to be paid to each of the parents towards loss of consortium on the death of a child.

The gross sum of the insurance amount thus stands enhanced by the Supreme Court.

— India Legal Bureau

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