[Case] On June 13, 2001, Cheng insured a Dongfeng truck he owned for vehicle damage insurance, third-party insurance, and on-board personnel liability insurance (3 seats, with a limit of 50,000 yuan per seat). The insurance period was from 0:00 on June 14, 2001 to 24:00 on June 13, 2002. On November 23, 2001, He, the driver hired by Cheng, was returning from delivering goods when he collided with a normally traveling Jiefang truck due to excessive speed while overtaking. He died at the scene. The traffic accident involved insurance claims. According to the traffic police department's determination, He was fully responsible for this accident. The insured, Cheng, did not compensate the relatives of the driver He due to his own significant losses. Soon after, Cheng requested 40,000 yuan in compensation for the on-board personnel liability insurance from the insurance company. After reviewing, the insurance company believed that this accident fell under the scope of on-board personnel liability insurance and subsequently compensated Cheng with 40,000 yuan for the on-board personnel liability insurance. This was a case of incorrect compensation for liability insurance where the insured gained an unjust enrichment due to an insurance accident.
[Case Insight] Article 49, paragraph 2 of China's Insurance Law stipulates: Liability insurance refers to insurance where the insured's legally liable compensation responsibility to a third party is the subject of insurance. In China's insurance market, the rapid development of liability insurance has become a new growth highlight for property insurance business. However, in the compensation work of liability insurance, there are many incorrect practices due to various reasons. As shown in the case mentioned in this article, the insured did not compensate the victim, yet the insurer compensated the insured with liability insurance compensation, resulting in the insured gaining an unjust enrichment through the insurance accident. Tracing the root cause, it mainly stems from the claims staff's unclear understanding of the constitutive elements of liability insurance compensation. Understanding and mastering the constitutive elements of liability insurance compensation is the foundational step in conducting liability insurance claims work. The following constitutive elements of liability insurance compensation are all indispensable:
One, the insured experiences an insurance accident within the scope of liability insurance. This is the basic condition for the insurer to fulfill its compensation obligation. If the accident experienced by the insured does not fall within the scope of liability insurance or is excluded due to certain reasons or costs, even if the insured incurs legal civil damages compensation responsibility due to subjective fault or legally non-fault behavior, the insurer does not bear the compensation responsibility.
Two, the insured should legally bear the damages compensation responsibility to the victim. This is the prerequisite condition for the insurer to fulfill its compensation obligation. The causes of the damages compensation responsibility borne by the insurer come from two aspects: one is the insured's subjective fault, i.e., the victim suffering material and spiritual damages due to the insured's subjective fault; the other is the damages compensation responsibility arising from legally prescribed non-fault behaviors of the insured. Such behaviors are clearly defined by law, and as long as they belong to legally prescribed non-fault behaviors, the insured must bear the compensation responsibility. The insurer does not take responsibility for damages compensation caused by other reasons.
Three, the victim makes a damages compensation request to the perpetrator (the insured). This is the necessary condition for the insurer to fulfill its compensation obligation. Since the subject of liability insurance is an intangible civil damages compensation responsibility, i.e., the insured's damages compensation responsibility to the victim, if the insured commits an infringement act but the victim does not make a compensation request due to various reasons, based on the principle of property insurance compensation (there is loss, there is compensation, how much loss, how much compensation), the insured has no loss, and thus the insurer does not need to bear the compensation responsibility. Therefore, lacking this element, the insurer can avoid bearing the compensation responsibility. The case presented in this article lacks this necessary condition, leading to the insured gaining an unjust enrichment.
Four, the insurer compensates the insured's losses within the limits of liability insurance compensation. This is the restrictive condition for the insurer to fulfill its compensation obligation. Since the subject of liability insurance is the insured's legal damages compensation responsibility rather than specific property, there cannot be an insurance amount in the liability insurance contract, only the insurer's compensation limit. The compensation limit is the highest amount the insurer needs to pay for the compensation obligation. The insurer compensates the losses within the compensation limit and does not compensate for losses outside the limit. It is not the case that regardless of the amount of loss, the compensation is always made according to the compensation limit. Therefore, the tier of compensation limit chosen by the insured directly determines whether they can receive full compensation.
Five, the insurer's direct payment of compensation to the victim should comply with legal provisions. This is the legal condition for the insurer to directly fulfill its compensation obligation to the victim. Article 49, paragraph 1 of China's Insurance Law stipulates: "The insurer may, according to legal provisions or contractual agreements, directly compensate the third party for damages caused by the insured." The contract referred to here includes not only the insurance contract but also any agreement reached between the insured and the victimized third party. If the insurer agrees with the compensation amount determined in the agreement and the compensation amount falls within the compensation limit, the compensation can be paid according to the agreement. If the compensation amount determined in the agreement exceeds the insurer's compensation limit, the insurer only needs to pay the compensation according to the limit, and the remaining part is the insured's responsibility to compensate. Therefore, under legal provisions or contractual agreements, the insurer can directly compensate the victim, otherwise, the insurer has no obligation to directly compensate the victim.
Reference materials: Relevant thematic articles: Can the insured refuse compensation outright after a traffic accident escape - Insurance claim materials; Rejection of homestead application leads to villagers suing the town government - Matters to note when hiring a lawyer for traffic accidents; Legal avoidance -- Intermediate corporate tax avoidance strategy: Optimizing corporate tax planning - Hangzhou legal consultation; "Because of focus, so simple; because of expertise, worth trusting; because of dedication, worth entrusting; because of integrity, worth relying on." Lawyer Zheng has been dedicated to becoming an expert in traffic accident cases since the beginning of his practice, accumulating years of experience in handling traffic accidents, possessing rich mediation and litigation skills, and being well-versed in the procedures and processes of handling traffic accidents. He has established good relations with courts, traffic police detachments, and disability assessment departments.
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