The claims arise under motor insurance are divided into two classes. i.e., claim for own damages and claims for third party liability. Here the claims for third party liability is briefly explained.
Settlement of Claims for third party liability in Motor Insurance
The third party liability arises when a motor vehicle hurts a third party so as to cause damage to his property or his death or a personal injury to him. For settlement of claims for third party liability, the following procedure is generally adopted:
1. Entry of Notice
As soon as the notice of claim is received [from any: the Insured, the third party, or the Motor Accidents Claims Tribunal (MACT)] the same will be entered in Claims Register. Date of intimation, claim number, Policy number, data of accident, Vehicle number, MACT number, Name of Insured, Driver and claimant, amount claimed etc are entered in the Claim Register. Separate sections are maintained in the register for fatal claims and bodily injury claims.
2. Appointment of Advocate
After entering the relevant particulars in the claims register, a competent advocate from the panel is appointed and case is entrusted to him for further action.
3. Letter to MACT
In case, the claim is received from MACT, a letter is issued to MACT to collect details of the claim information necessary for the case like claim number, Driver, advocate, number of policy and driver’s prosecution history etc.
4. Letter to Police station
A letter has to be written to police station for getting police report or panchnama statement on accident.
5. Own damage claim
A copy of own damage ‘claim from Insured‘ is also to be produced.
6. Furnishing required information
The following information is required to determine the liability of the insured and liability under policy to insurer:
- Existence of insurance and limit of liability.
- Driver’s statement and statement of witnesses.
- Driver’s record of past prosecutions, charges, depositions during trial and final judgement.
- Details of accident to find the negligence of parties for ‘contributory Negligence‘.
- Post-Mortem Report (fatal claims).
- Medical report in bodily injury regarding age, occupation, nature and extent of injury and disability (duration in days), partial / total incapacity and general opinion of doctor.
7. Determination of Quantum of Damages
In case of fatal accidents, factors such as Deceased’s status, monthly income, contribution to family, relationship with claimant and claimant’s status, are taken into account while ascertaining the amount of damages. In case of injury, medical certificate on injury, extent of disability, medical expenditure with vouchers and monthly income (loss due to confinement in hospital) are to be taken as a basis for determining the amount of damages.
8. Advocate’s opinion
Based on above facts, the opinion of advocate is sought. He files a written statement. It may, if necessary, file a compromise petition. This is done if the driver is convicted or facts show negligence.
9. Payment of claims
The MACT decides the claim in presence of insurer, insured and third party and their advocates. The amount awarded is finally paid to third party with proper discharge of all claims arising out of the occurrence.