Insurance Claim: Will you get an insurance claim if your driving license has expired? The Court clarifies

Insurance Claim: Do you know whether you can claim insurance if your driving license has expired? The Supreme Court itself has addressed this matter; let’s understand the full details.

Insurance Claim News: Nowadays, almost everyone owns a vehicle. There is always a risk of mishaps while driving—such as another vehicle hitting yours or a collision occurring—resulting in damage to the vehicle. While having vehicle insurance offers some relief in such situations, have you ever wondered if you would still receive an insurance claim if your license had expired at the time of the incident?

What did the Supreme Court say?

The Supreme Court delivered a verdict on Thursday regarding a significant case concerning motor accident compensation. A bench comprising Justices Sanjay Karol and N. Kotiswar Singh ruled that if a driver's license has expired or is invalid, it constitutes a violation of the insurance policy's terms. In such a scenario, the insurance company cannot be held liable to ultimately bear the cost of compensation; it may pay the amount initially but is entitled to recover it from the vehicle owner and the driver later.

Will the victim receive compensation?

Addressing the question of whether the victim would receive compensation, the Court stated, "Yes, the victim will receive compensation." The Court implemented the 'Pay and Recover' system. This means the insurance company will first pay the compensation amount to the victim or their family and subsequently recover that amount from the vehicle owner and driver who violated the insurance terms. The objective of this arrangement is to ensure that the victim's family does not have to wait a long time for compensation due to a dispute between the insurance company and the vehicle owner.

What is the full case?

The Supreme Court delivered this verdict in a case related to a road accident that occurred in Punjab in 2009, in which a vehicle collided with a two-wheeler. The Motor Accident Claims Tribunal had held that the driver's license had expired well before the accident and was renewed only subsequently; therefore, the insurance company was not liable for compensation. Later, the Punjab and Haryana High Court overturned this decision and ordered the insurance company to pay compensation exceeding ₹1.08 crore.