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Liablity of insurance company

(Querist) 02 July 2008 This query is : Resolved 
Sec.3(1)&4A(3) of Workmen's compensation Act,1923-Liability of employer and insurer to pay compensation-Scope of-in cases, where insurer is liable to indemnfy the employer for latters liability to pay compensation,whether he may be exonerated from the interest accrued on it ?
KamalNayanSaxena (Expert) 02 July 2008
In order to succeed, it has to be proved by the employee that (1) there was an accident, (2) the accident had a causal connection with the employment, and (3) the accident must have been suffered in course of employment.

Insurer is liable to indemnify insured in the terms of policy and may be exonerated from the interest accrued on it.
H. S. Thukral (Expert) 03 July 2008
Dear Mr. Chowdhary
I have been taking keen interest in to reading your queries and whereever I thought that I know the right answer I have tried to resolve it. I also know that you know the answer to the query and you have put it on the web site to check the knowledge of persons like me who have been, without much verification, termed as experts and are over enthusiatic to answer the queries to top the hall of fame. Yours queries are definitely intriguing. I regret on one point only that you after the query is amnswered have not indulged in further discussion knowing well that answer was not up to mark.

As for example your present query on workmen Compensation. Well I am not satisfied with the answer and perhaps knowing well the correct position you ould also not be but you have not further discussed it. It results in conveying a wrong opinion to several others who read solutions to various problems answered by my Ld. friends of the club and use the knowledge so gained in their profession.

I attempt to answer your query and hope if I am wrong you will further discuss it.

Well if an accident is a Motor Vehicle accident the injured workman can claim compensation under either of the two statues. Under Motor Vehicle Act it is statutory to get insurance and under section 147 of the Act the compensation by the insurer is a statutory corollary. whereas in other cases where the workman is benificary under the WC Act alone, employer is not to get insurance compulsory and it if it gets insured, the terms of the contract of insurance shall govern the relation.
Therefore if there is a Motor Accident case the insurer shall be liable to pay interest if the payment is not paid within a month of the accident
Ved Praksh Garg v Prema Devi
1998 LLJ (1) SC 363
but if it is not motor accident and the terms of insurance specifically exclude payment of interest the insurer shall not be liable and it will be the liability of the insured.
National Insurance Corporation v Harshadbhai 2006(5) SCC 192
Hope my answer is satisfactory.
adv. rajeev ( rajoo ) (Expert) 26 March 2009
I agree with Harbaan Singh


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