1. Appeal by insurance company against award for death of pillion rider in motor accident. (Para 2 , 3 )
Back
Next 
2026 Supreme(Online)(Tel) 11864
IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
Renuka Yara, J
Shriram General Insurance Co. Ltd. – Appellant
Versus
Vallakati Aishwarya – Respondent
M.A.C.M.A.No.426 of 2025
Advocates:
For the Appellants/Petitioners: A. Ramakrishna Reddy
For the Respondents: A.S.Narayana
For the Appellants/Petitioners: A. Ramakrishna Reddy
For the Respondents: A.S.Narayana
Important Points
The Court held that a comprehensive package policy covers pillion riders regardless of their relationship to the owner. Additionally, for computing loss of dependency in motor accident claims, gross salary must be considered instead of net salary.
Subject
Civil - Motor Accident Claims
Act Referred
Motor Vehicle Act, 1988: S.166, S.165
Headnote
(A) Insurance Law - Package Policy - Liability for Pillion Rider - Where a vehicle is covered under a comprehensive package policy, the risk to the pillion rider is covered, and the insurance company cannot claim immunity even if the deceased is a close relative (mother) of the owner/insured. (Para 10, 12)
(B) Motor Accident Claims - Delay in FIR - Condonation - A delay in lodging an FIR is permissible and not fatal to a claim if the legal heirs were preoccupied with the medical treatment of the injured person before their demise. (Para 13)
(C) Quantification of Compensation - Dependency - Calculation of Income - For the purpose of computing loss of dependency, the gross salary of the deceased must be taken into consideration rather than the net salary. (Para 14)
Issues: Whether the insurance company is liable to pay compensation for a pillion rider who is the mother of the insured under a package policy, and whether gross salary should be used for compensation calculation.
(B) Motor Accident Claims - Delay in FIR - Condonation - A delay in lodging an FIR is permissible and not fatal to a claim if the legal heirs were preoccupied with the medical treatment of the injured person before their demise. (Para 13)
(C) Quantification of Compensation - Dependency - Calculation of Income - For the purpose of computing loss of dependency, the gross salary of the deceased must be taken into consideration rather than the net salary. (Para 14)
Issues: Whether the insurance company is liable to pay compensation for a pillion rider who is the mother of the insured under a package policy, and whether gross salary should be used for compensation calculation.
Legal Category Hierarchy
- tort
- insurance law
- practice and procedure
Table of Contents
2. Insurance company argued pillion rider not a third party and no premium paid for her coverage. (Para 5 , 6 )
3. Package policy covers pillion rider risk; gross salary considered for dependency; FIR delay justified. (Para 10 , 11 , 12 , 13 , 14 )
4. Pillion rider covered under package policy even if relative of owner; gross salary used for dependency. (Para 12 , 14 )
5. Appeal dismissed; award confirmed. (Para 15 )
6. Is a pillion rider covered under a comprehensive package policy for a two-wheeler?
Yes, a comprehensive package policy for a two-wheeler covers the risk of a pillion rider. (Para 10 , 11 , 12 )
7. Can the legal heirs of a pillion rider who is the mother of the vehicle owner claim compensation?
Yes, they can claim compensation as the pillion rider is covered under the package policy, regardless of the relationship with the owner. (Para 12 )
8. Should gross salary or net salary be used to compute loss of dependency in motor accident claims?
Gross salary must be used to compute loss of dependency, not the net salary. (Para 14 )
9. Is a delay in lodging an FIR fatal to a motor accident claim?
No, the delay is justified if the legal heirs were occupied with the deceased's medical treatment. (Para 13 )
Heard Sri A. Ramakrishna Reddy, learned counsel for the appellant
and Sri A.S.Narayana, learned counsel for respondent Nos.1 and 2.
Perused the entire record.
2. The M.A.C.M.A. is preferred by the appellant/respondent No.2- insurance company aggrieved by the award passed by the learned Chairman, Motor Accidents Claims Tribunal-cum-XXIV Additional Chief Judge, City Civil Court at Hyderabad, (‘Tribunal’) dated 19.08.2024 in M.V.O.P.No.479 of 2022, wherein a claim petition filed by respondent Nos.1 and 2 herein seeking compensation of Rs.30,00,000/- under Section 166 of Motor Vehicle Act, 1988 (‘M.V.Act’) has been allowed-in-part awarding a sum of Rs.27,71,320/- payable with interest at 7.5% per annum
with proportionate costs.
RY, J MACMA_426_2025
3. The background facts are that on 07.12.2019, at about 21.45 hours, the deceased by name Vallakati Aruna and her son were proceeding on bike bearing number TS 08 FS 5100 from Rajeevgruhakalpa, Suraram to Shapur Nagar. When the bike reached Om Janda Suraram, Quthbullapur, the rider has driven in rash and negligent manner without observing a speed breaker and passed over it. Due to said rash driving, the pillion rider fell down on the road, sustained bleeding injuries to the head. She was immediately shifted to Yashoda Hospital, Somajiguda and from there to Gandhi Hospital. While undergoing treatment, she died on 13.12.2019 at about 21:47 hours. A claim petition was filed by the legal heirs of the deceased seeking compensation of Rs.30,00,000/- and the same was allowed in part for Rs.27,71,320/- payable with interest at 7.5% per annum. 4. Aggrieved by the same, the insurance company preferred the present appeal, on the ground that the deceased is none other than mother of the owner/insured of the crime vehicle and therefore, the deceased cannot be considered as a third party to the policy. It is pleaded that the risk of pillion rider is covered under a package policy is not correct as the owner of the vehicle has not paid any premium to cover the risk of the pillion rider and the package policy covers the risk of own damage apart from third party damage. However, to cover the risk of pillion rider, additional premium has
2
RY, J MACMA_426_2025
to be paid by the owner. It is pleaded that the owner obtained Ex.B-1 policy and paid an amount of Rs.686/- towards own damage, Rs.1,193/- towards basic third party cover and Rs.315/- towards personal accident cover for owner-cum-driver. Except the aforementioned, premium to cover the risk of pillion rider was not paid. In the circumstances, since the mother of the owner is not a third party, but was travelling as pillion rider, the insurance
company is not liable to pay compensation.
5. It is pleaded that in the case of New India Assurance Co. Ltd. v. Sadanand Mukhi , Civil Appeal No.7402 of 2008, it is held by the Hon'ble Supreme Court that owner and deceased, father and son do not have a third party relationship as contemplated under Section 165 of the M.V.Act and therefore, the relatives
would not be entitled to compensation from the insurance company.
6. Apart from the fact of liability to cover the risk of the pillion rider, the appellant also raised the issue of delay of seven days in lodging the FIR and quantification of the compensation paid, more particularly for considering the gross total income of Rs.20,158/- per month while
computing the loss of dependency instead of considering net salary.
3
RY, J MACMA_426_2025
7. Learned counsel for appellant-insurance company relied upon the case of Jayavarapu Rajamma v. Jayavarapu Laxminarayana , 2007 (6) ALD 306 (DB), wherein the High Court of Judicature, Andhra Pradesh at Hyderabad, held that the kith and kin of the insured for injuries and their legal representatives in the event of the death in an accident can sustain claims for compensation as third party claims, provided the relevant policy of the insurance covers such risks. Mere nomenclature of the policy as comprehensive policy or otherwise is not the
