उच्चतम न्यायालय ने व्यवस्था दी है कि यदि वाहन स्वीकृत मार्ग से विचलन (route deviation) करता है, तो भी बीमा कंपनी (insurance company) दुर्घटना पीड़ितों को मुआवजा (compensation) देने से मना नहीं कर सकती और उसे भुगतान कर वसूली (pay and recover) का नियम अपनाना होगा।
On October 29, 2025 (Wednesday), the Supreme Court (SC) of India heard the matter related to the motor vehicle accident compensation case, where the question under consideration was “Whether deviation by the vehicle from the permitted route under a transport permit constitutes such a breach of policy conditions as to absolve the insurance company of liability to compensate third-party victims of a motor accident.” The two-judge bench of the SC, comprising Justice Sanjay Karol and Justice Prashant Kumar Mishra, held that insurers/insurance companies cannot deny compensation to accident victims even if the vehicle involved deviated from the permitted route.
In this case, the victim died in a road accident when his motorcycle was hit by a bus driven rashly and negligently. His dependents (the appellants) filed a claim petition seeking ₹50,00,000 compensation. The Tribunal awarded ₹18,86,000 based on the notional income of ₹8,000/month. Dissatisfied, the claimants appealed for enhancement, while the insurer challenged the award, alleging route deviation in violation of the permit. The High Court enhanced compensation to ₹31,84,000 by reassessing income, adding future prospects, and granting consortium benefits. However, noting that the vehicle was operating outside its permitted route, the High Court applied the “pay and recover” principle, directing the insurer to first satisfy the award and then recover the amount from the owner.
The matter was mentioned before the SC, where it examined whether route deviation nullifies insurance liability. The top court referred to various existing decisions and opined, “The purpose of an insurance policy in the present context is to shield the owner or operator from direct liability when such an unforeseen or unfortunate incident takes place. To deny the victim or dependents of the victim compensation simply because the accident took place outside the bounds of the permit and therefore is outside the purview of the insurance policy, would be offensive to the sense of justice, for the accident itself is for no fault of his. Then, the Insurance Company most certainly ought to pay.” The SC added, “At the same time though, when an Insurance Company takes on a policy and accepts payments of premium in pursuance thereto, it agrees to do so within certain bounds. The contract lays down the four corners within which such an insurance policy would operate. If that is the case, to expect the insurer to pay compensation to a third party, which is clearly outside the bounds of the said agreement would be unfair.”
Lastly, the top court upheld the High Court’s direction. The insurer must pay the compensation to the claimants and may recover the same from the owner. The judgment reiterated, “the compensation mechanism under the Motor Vehicles Act must be interpreted liberally in favour of accident victims. To deny the victim or his dependents compensation simply because the accident took place outside the bounds of the permit would be offensive to the sense of justice. Balancing the need for payment of compensation to the victim vis-à-vis the interests of the insurer, the order of the High Court applying the pay-and-recover principle is entirely justified.”