SC wants insurance companies to develop accident claims app – what is it and how it will help

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New Delhi: Last week, the Supreme Court set a two-month deadline for the General Insurance Council (GIC) to develop a mobile application allowing rapid settlement of third party compensation claims in the event of a traffic accident. Police are expected to upload details of the accident to the app within 48 hours of it happening.

The police must then file a detailed report within 90 days. After that, the insurance companies would have 30 days to compensate the plaintiff with a fixed amount, or else to fight in court.

A bench led by Judge Sanjay Kishan Kaul dismissed the GIC’s call for a “time limit” to develop the app, saying if insurance companies were unable to do so, the court would ask the government to do so and enforce enforcement. on insurance companies.

The Magistrates Court’s order of November 16 is the result of 10-month deliberations on how to expedite compensation cases pending before the Motor Accident Claims Tribunal (MACT).

In its order, the court noted that most MACT cases were pending in various MACT courts across the country, with more than 25% being over three years old. Thirty-five percent of all cases pending in Maharashtra’s first instance courts are insurance claims arising from traffic accidents, the order also noted.

Following an earlier order issued on October 26, all stakeholders such as police, insurance companies and MACT courts will need to use the app once it is developed.

ThePrint explains how this app will speed up the processing of compensation cases.

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Two provisions of Motor Vehicle Act

A third party insurance claim can be made using two provisions of the Motor Vehicles Act, 1988: Sections 166 and 163A.

Under section 163A, there is a straitjacket formula for compensation with no provision for contesting such claims. While Rs 5 lakh may be required in the event of death, Rs 2.5 lakh is the fixed amount paid in the event that an accident results in permanent disability.

Although this is a quick process for settling accident compensation claims, victims and their families generally do not opt ​​for it due to the limit on the amount of the claim.

Experts working in the field of MACT cases told ThePrint that victims and their families are asking for higher compensation, for which Section 166 claims are being made. These claims are usually contested by insurance companies, which leads to a lawsuit as in a civil case.

“Compensation claimed under this provision is calculated on the basis of factors such as the victim’s age, income and the number of dependents. With younger victims and higher incomes, compensation can reach millions of dollars, ”said a lawyer.

Claimants in MACT cases, who don’t usually come from well-off backgrounds, tend to take their time filing claims.

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The new application

The new app, however, will require police to download details of the accident within 48 hours of its occurrence. This information will immediately be entered into the system of the insurance company with which the offending vehicle is insured, as well as of the MACT court in which the accident took place.

After that, the police will be required to produce the claimant in the MACT court within 90 days, along with a detailed accident report. This would include documents such as the indictment, victim profile, information about the applicant, and proof of income for the victim and their dependents.

An GIC official, on condition of anonymity, told ThePrint: “These documents can even be uploaded to the app before the police physically take the plaintiff to court.”

He explained that the goal of developing the app was to remove the paperwork in the current process. “Once an accident is reported, the police must send a notice under the Motor Vehicle Act to the vehicle owner and the insurance company for their responses. It’s a time consuming process, but the app can remove everything.

The application will be connected to three digital databases: Vahan, the vehicle database, Saarthi, the driver’s license database, and the Insurance Information bureau, an organization of insurance companies under the regulatory authority. and insurance development. This means that the police will no longer have to contact the owner or the insurance company individually. Once the vehicle number is entered into the app, it will automatically display results on them.

“The app will help police save a lot of time that would otherwise be spent determining whether the owner’s driver’s license and vehicle insurance are valid,” the officer said.

He added that the detailed police action report will now be treated as the claim request, making it more mandatory for the claimant to file a separate claim.

No more false claims

After the police file their detailed accident report, the insurance company will have 30 days to settle the case by offering a fixed amount to the claimant, otherwise they can fight.

“Since the insurance company would receive information about the vehicle long before the case reaches court, it cannot give excuses for dragging it out,” the attorney said.

With the responsibility now on the police to upload accident details to the app, the lawyer added, the bogus claims that tend to be filed in small towns will cease. Recently, he pointed out, the Supreme Court took note of such a scam involving lawyers in Uttar Pradesh which led to the suspension of some lawyers there.

“Currently, there is no mechanism to notify MACT or the insurance company on site. This gives police leeway to continue investigating incidents. In many cases, it has been found that lawyers collude with the police to file false statements, ”the lawyer said.

In such cases, he said, police impound a vehicle they have already seized in connection with another crime and file documents in the MACT court. Eyewitnesses are also present to support the police theory, which has led MACT to order insurance companies to pay.

(Edited by Rohan Manoj)

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