Victims of fatal road accidents, who are either self-employed or have fixed income, will now be entitled to higher compensation under motor accident claims after the Supreme Court on Tuesday held that ‘future prospect’ of income of such persons will also be factored in for awarding just compensation to the dependents of such victims.
The decision has come as a big relief for professionals in both skilled and unskilled sector as till date “future prospects” was added towards compensation only in cases where the deceased had a permanent job. If the victim was self-employed or had fixed income, his actual income at time of death was taken as the basis for computing compensation.
Overruling this law, a five judge bench headed by Chief Justice Dipak Misra noted that in past decisions of the apex court it was recognized that incomes do vary with cost of living. Accepting the principle of standardization, the bench said, “In case the deceased was self-employed or on a fixed salary, an addition of 40 per cent of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25 per cent where the deceased was between the age of 40 to 50 years and 10 per cent where the deceased was between the age of 50 to 60 years…”
The Court further standardized compensation under the heads : loss of estate, loss of consortium and funeral expenses to be Rs 15,000, Rs 40,000, and Rs 15,000 respectively and opined that this amount be enhanced on percentage basis in every three years at the rate of 10 per cent in a span of three years.