Overloading Passenger Not Fundamental Breach Unless Linked To Accident Cause: Himachal Pradesh High Court

The Himachal Pradesh High Court ruled that overloading a passenger vehicle by one person does not constitute a fundamental breach of the insurance policy unless it directly relates to the cause of the accident.

Relying on National Insurance Co. Ltd. v. Swaran Singh (2004), the Court emphasised that any breach must be causally connected to the accident to absolve the insurer from liability. 

In this case, a five-seater car carried six passengers near Shimla. The insurer argued that overloading violated policy terms, but the Court found no link between the extra passenger and the crash.

The court upheld compensation but reduced the amount, noting inconsistent proof of overtime income. The insurer was directed to pay the claimants.