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‘File suggestions to regulate deposit, disbursal of compensation to motor accident victims’: HC to Haryana, Punjab, Chandigarh

The HC passed the order while hearing the petition of HDFC Ergo General Insurance Company Limited.

Written by Jagpreet Singh Sandhu | Chandigarh |
February 25, 2021 8:37:06 am
Punjab and Haryana High Court, IGP’s anticipatory bail, Umranangal, Punjab news, chandigarh news, indian expressPunjab and Haryana High Court .

The Punjab and Haryana High Court has directed the states of Haryana, Punjab, and UT Chandigarh to file their response/suggestions with regard to regulating the practice and procedure for deposit of claim amounts by insurance companies as per orders of Motor Accident Claims Tribunals (MACT).

The bench of Justice Anil Kshetarpal, however said that if the officials failed to file reply, the chief secretaries of the states and home secretary of Chandigarh will have to be present in court to explain reasons for not filing the response.

The HC passed the order while hearing the petition of HDFC Ergo General Insurance Company Limited.

The petitioner company, through its counsel advocate Sanjeev Kodan, moved HC to direct Punjab, Haryana and Chandigarh, to constitute a committee to assist the HC to frame rules for regulating the practice and proceedings in respect to deposit of awarded amount and disbursal of awarded compensation of motor accident victims, through electronic transfer, and also to open a bank account under the Motor Accident Claims annuity deposit as applicable in Delhi so that the claimants can get the maximum interest on the awarded amount.

It was also contended by the petitioner company counsel that as an insurance company, it has been dutifully dispensing its obligation as an insurer, but over the years there have been problems associated with disbursement which have not been tackled and purely on account of disbursement system of the MACT, which has not kept pace with changing requirements. It has also come to the notice of the company that compensation amount released to the victim/claimant family in fact does not reach the actual recipient in full, the reason being that claimants have to depend upon various intermediaries who claim their share out of the awarded compensation alleging it to be for their services in obtaining those cheques/negotiable instruments, but in Haryana, Punjab, and Chandigarh amount deposited by the insurer or insured is remitted in savings account of claimants through NEFT/RTGS since 3-4 years.

It was also contended that the transaction takes considerable time, leading to delay in disbursal of the awarded amount when most needed, at the same time there is loss of interest to the recipient, which remains unclaimed. In majority cases, the victims or claimants are uneducated, and in some cases there have been instances where the claimants or victims have not even opened their bank accounts.

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