The Supreme Court has ruled that an *insurance company can be directed to first pay compensation to claimants in a motor accident case — even where the deceased was an unauthorised or gratuitous passenger in a goods vehicle — and subsequently recover the amount from the vehicle’s owner.
This principle was reaffirmed in a recent case arising from a fatal accident involving a goods vehicle that had been hired to transport a Ganesh idol. The deceased was travelling in the vehicle alongside the idol — not as a fare-paying passenger — and the question was whether the insurer, which would normally not be liable for passengers in a goods carriage, could be asked to satisfy the award.
The Supreme Court restored the Motor Accident Claims Tribunal’s direction that the insurance company must disburse compensation upfront to the victims’ legal heirs under the “pay and recover” doctrine. After making the payment, the insurer has the statutory right to recover the amount from the owner of the offending vehicle.
This ruling reinforces that victims of road accidents should not be left uncompensated due to technical exclusions in insurance coverage — instead, statutory protection aims to ensure they receive relief first, with legal rights preserved for insurers to seek reimbursement later.
