Injured in a road accident? How MACT compensation works

What the law says

Who can claim, and where. A claim is made to the Motor Accident Claims Tribunal under Section 166. It can be filed by the person who was injured, by all or any of the legal representatives of a person who died, by the owner of damaged property, or by an authorised agent. The right is not limited to financial dependents: courts have held that legal representatives such as a married daughter or an adult son can claim, because the statute does not turn on dependency. If the injured person dies while the claim is pending, the right survives to their legal heirs. Only the Tribunal has jurisdiction over these claims; a civil court or a consumer forum cannot decide them. You can file where the accident happened, where you live or work, or where the person you are claiming against lives, and the law requires the application to be made within six months of the accident, so it is important not to delay.

Two routes: no-fault and fault-based. The no-fault route is Section 164. It pays a fixed amount, five lakh rupees in the case of death and two and a half lakh rupees for grievous hurt, and you do not have to plead or prove any wrongful act, neglect, or default by anyone. Because it is a no-fault remedy, the insurer cannot defeat it by arguing that the victim was careless. The fault-based route is Section 166, where you do have to establish that the accident was caused by someone's negligence, but the standard is only the preponderance of probabilities, the civil standard, not the "beyond reasonable doubt" of a criminal case. The trade-off is that a fault-based claim can yield much larger "just compensation". The two routes are separate and final, and you must elect one: accepting the fixed amount under the no-fault route makes a pending fault-based petition lapse.

How "just compensation" is worked out. Under the fault-based route the Tribunal must award compensation that is "just", meaning fair and reasonable, neither a windfall or bonanza nor a niggardly pittance. For loss of future income, courts use the multiplier method laid down in Sarla Verma, which picks a multiplier based on the age of the deceased or injured person and applies it to the annual loss of dependency. To that, courts add "future prospects", a percentage for likely career growth, and the Supreme Court has held that future prospects are included even in serious non-fatal injuries that cause permanent disablement, not only in death cases. Courts have also rejected the routine use of a "split multiplier" that assumes income drops after retirement, unless there is specific evidence for it. Compensation covers several heads together: loss of dependency or future income, medical expenses, attendant care, pain and suffering, and loss of the amenities of life. Interest is added at a rate the Tribunal fixes in its discretion, usually tracking the prevailing bank rate.

What you can do

1. Make sure the accident is on record. A police report of the accident is the foundation of a claim, and the Tribunal can treat such a report as an application for compensation.
2. Decide which route fits. The no-fault route under Section 164 is quicker and pays a fixed amount without proving negligence; the fault-based route under Section 166 needs proof of negligence but can yield larger compensation. You have to choose one, so weigh them.
3. File with the Motor Accident Claims Tribunal, and do it promptly. The law sets a six-month window from the date of the accident, and you can file where the accident happened, where you live or work, or where the other side lives.
4. Gather what supports the amount: income proof such as salary slips, medical records and bills, disability assessment, and details of dependents. For the fault-based route, remember the standard is the preponderance of probabilities, not the criminal standard.
5. In a death case, any of the legal representatives can file, and should do so for the benefit of all; a claim is not barred just because a claimant was not financially dependent on the deceased.
6. Expect compensation to be built from several heads together, loss of income, medical costs, pain and suffering, loss of amenities, and future prospects, with interest, rather than a single round figure.
7. Keep every document: the accident report, medical and income papers, and the Tribunal's award. If the injured person passes away while the claim is pending, the right to the claim survives to their heirs.

Cases that matter

Sidram v. The Divisional Manager, United India Insurance Co. Ltd., Supreme Court of India (2022). A nineteen-year-old was left paraplegic by a road accident. The Court held that "just compensation" must restore the victim as far as possible to their pre-accident position, and that a claimant with a serious injury causing permanent disablement is entitled to future prospects too, correcting the mistaken view that future prospects apply only in fatal cases. It anchors how seriously the law takes lifelong injury.

The Oriental Insurance Co. Ltd. v. Yesodha, Madras High Court (2017). An insurer argued a father could not claim for his son because he was not shown as a dependent or in a heir certificate. The court held the right to claim belongs to legal representatives and does not depend on financial dependency, as there is still a loss to the estate. It settles that non-dependent family can claim.

Deepal Girishbhai Soni v. United India Assurance Co. Ltd., Supreme Court of India (2004). The Court held that the no-fault structured route and the fault-based route are distinct, independent, and final remedies, and that a claimant must elect one and cannot pursue both. It explains why you have to choose your route at the outset.

Puttamma v. K. L. Narayana Reddy, Supreme Court of India (2013). The Court held that for fault-based claims the multiplier method based on Sarla Verma must be used, and that a "split multiplier" must not be applied routinely without specific evidence. It also urged updating outdated compensation tables. It fixes the method for computing loss of future income.