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INSURANCE FIRMS CAN CITE LICENCE LAPSE

An insurance company can prove in its defence that the driver who caused a fatal accident did not have the requisite to licence when he was driving the vehicle. It would be for the insurer to prove that the insured (owner) did not take adequate care and caution to verify the genuineness or otherwise of the licence held by the driver.

If the company proves so, it can escape the liability to pay compensation and the burden would pass on to the owner of the vehicle, the Supreme Court said in the National Insurance Company vs. Kanti Devi case.

The Motor Accident Claims Tribunal in this case awarded Rs. 2.24 lakh to the mother of a young driver together with 8 percent interest. Though the driver had a licence for light vehicles, at the time of the accident he was driving a truck.

However, the tribunal as well as the Delhi High Court fastened the liability on the insurance company. On appeal, the Supreme Court remanded the case to the tribunal for as fresh decision following the above principle.

The Insurance Times July 2005