Amount of money received as Mediclaim not deductible from an award passed by MACT under the head of medical expenses.
Amount of money received as Mediclaim under Mediclaim policy is not deductible from an award passed by Motor Accidents Claims Tribunal (the MACT) which may also include compensation under the head of medical expenses, if claimed.
ABCAUS Case Law Citation:
5149 (2026) (05) abacus.in SC
Important Case Laws relied upon by Parties:
Reliance General Insurance Co. Ltd. v. Shashi Sharma
Helen C. Rebello v. Maharashtra SRTC
Oriental Insurance Co. Ltd. v. R. Swaminathan
In the instant case, the issue to be decided was as to whether the amount of money received as Mediclaim, in terms of a Mediclaim policy, is deductible from an award passed by Motor Accidents Claims Tribunal (the MACT)?
The appellant Insurance company had challenged the order of a Full Bench of Bombay High Court whereby the Bench decided the conflict between its judgments.
The case of the appellant was that the respondent-insured had already been reimbursed for medical expenses through a Mediclaim policy and once such reimbursement had taken place, the loss under that specific head was neutralized and so, awarding the same amount again under the head of medical expenses would go beyond restitution and lead to or result in a duplication of benefit.
The Hon’ble Supreme Court took note of the opposite views across the High Courts even of the same Court. The Bombay High Court, The Madhya Pradesh High Court, Karnataka High Court, Punjab & Haryana High Court, Calcutta High Court, Delhi High Court in some cases held that Mediclaim, as a claim is independent from a claim under Section 166 of MVA and the award received need not be deducted. Whereas, other view is that the amount received from a Mediclaim is in fact deductible from the total compensation.
The Hon’ble Supreme Court observed that a Mediclaim policy is a policy that is purchased by a person, accounting for the uncertainties of life and preparing a financial base for an unfortunate possible eventuality. In today’s time when medical expenses are skyrocketing for a variety of reasons, the ability to meet such expenses, suddenly as and when they may arise, is not something that rests with all. It is, as such, a necessary facet of preparation that people undertake. It doesn’t specifically deal with accidental coverage only. The contractual benefit of reimbursement of medical expenses as a result of Mediclaim policy is, therefore, independent of any other claim.
The Hon’ble Supreme Court further observed that the provisions of the MVA are only triggered in the unfortunate eventuality if a death or injury arising out of a motor vehicle an accident occurs. That in itself, when it does arise, cannot eclipse the contractual benefit to which a person who has paid premiums, is entitled too. Compensation under MVA while it recognizes reimbursement of medical expenses is distinct from the contractual benefit, though it may be with respect to the very same heads.
The Hon’ble Supreme Court opined that if the view of the High Courts that it would amount to “double benefit” is agreed to, a peculiar situation will arise. On the one end, it may save compensation from being affected by double benefit, if it can be called that, but on the other, it would denude the claimant of the benefits that arise out of them parting with their hard-earned money in the form of Mediclaim premiums. To call it “double benefit” may not be appropriate since one situation is only the fruit of amounts already paid in the past. Only because they appear same or similar, they cannot be termed as “double benefit”.
The Hon’ble Supreme Court also expressed concern over contrary positions of law being taken by the same High Court, whether it be by the benches of the same strength or by the benches of lesser strength in ignorance of pronouncements made by the benches of higher strength.
The Hon’ble Supreme Court stated that tens of orders and judgments are pronounced every day across a range of issues and so, the Court before which they are appearing may not be aware of the latest pronouncement. The counsel must disclose the same to the Court ensuring consistency. However, the entire burden cannot be placed only on counsel. The Court itself has an independent tri-fold duty, to apply correct law even if the counsel does not cite the same. Both the Bar and the Bench are responsible for minimising the problems that arise in the face of inconsistent judicial opinion.
As a result, the Hon’ble Supreme Court held that the amount received as part of Mediclaim/medical insurance is not deductible from compensation as calculated by the MACT, adjudicating a claim for compensation under the MVA which may also include compensation under the head of medical expenses, if claimed.
The Hon’ble Supreme Court clarified that these two stand on a different footing – one is statutory while the other is contractual and the latter is only a sequitur of premiums having been paid in the past while the other is an entitlement as a consequence of an accident or death in a motor vehicle accident.
Accordingly, the matter was remanded to the High Court.
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