Motor Accident Compensation | Renewal Commission is passed down and not deducted when calculating the income of a deceased LIC agent: Jharkhand High Court.
The Jharkhand High Court has ruled that the renewal commission is passed down through inheritance and should not be deducted when calculating the income of a deceased LIC Agent for motor accident compensation. The Court upheld the decision made by the Motor Accident Claims Tribunal, which ordered the Insurance Company to compensate the legal heirs of the deceased LIC agent who died in a road accident. The Court stated that the renewal commission received by the deceased’s wife should be included in the compensation calculation. Justice Subhash Chand noted, “This issue is resolved against the appellant-Insurance Company and in favor of the claimants. The renewal commission is hereditary and should not be deducted when determining the income of the deceased LIC Agent.”
Advocate Ashutosh Anand represented the Insurance Company, while Advocate Saibal Kumar Laik represented the claimants. The claimants, including the deceased’s wife, children, and mother, sought compensation for loss of dependency, loss of consortium, and other damages. The Tribunal granted compensation with interest from the filing date until it was paid. The Insurance Company contested the award, arguing that the deceased’s wife still received his renewal commission and that there was no loss of dependency. They claimed the compensation was too high and based on incorrect conclusions. They also mentioned that the insurer had the right to challenge the compensation amount under Section 170 of the Motor Vehicles Act, 1988, as allowed by the Tribunal.
The High Court stated that the renewal commission is a hereditary commission, which is also payable to the widow of the deceased, regardless of the circumstances of death. This means that the renewal commission is considered a hereditary benefit and is due to her after her husband’s death, whether it was natural, caused by violence, or accidental. The Bench referenced a ruling from the Calcutta High Court in the case of National Insurance Co. Ltd. v. Ayesha Sekh (2015), which determined that not including the hereditary commission for the legal representative after the death of a LIC agent was incorrect. The hereditary commission for the deceased’s heir is unrelated to the cause of death and would still be payable regardless of how the death occurred.
As a result, the Court concluded that the award from the Tribunal does not require any changes, and the appeal should be dismissed. Therefore, the High Court dismissed the appeal.
Cause Title: Shriram General Insurance Co. Ltd v. Kavita & Ors.
