A recent Supreme Court judgment clarifies that an accident victim's functional disability cannot be assessed merely by looking at whether the victim continues to receive a salary. The Court held that earning capacity must be assessed in the context of the victim's ability to independently compete and earn in the open labour market. A person can continue working after a serious accident and still suffer a substantial loss of earning capacity. That is the central message emerging from the Supreme Court's judgment in Reliance General Insurance Company Limited v. Priyanka Das & Ors., decided on 3 September 2026. The case involved a woman who suffered catastrophic injuries in a road accident, including permanent bilateral cortical blindness, pelvic injuries and a permanent colostomy stoma. Despite these injuries, she continued working because her employer provided specialised software, flexible working arrangements and extensive accommodations. The insurance company argued that because she remained employed and her salary had increased, her functional disability should not be treated as 100%. The Supreme Court rejected that approach. Instead, the Court held that the relevant question is not simply whether an accident victim has retained a particular job. The assessment must consider the person's ability to earn in the open and competitive labour market. Quick Answer: Can You Claim Loss of Earning Capacity Even If You Continue Working? Yes. Continuing employment does not automatically mean that an accident victim has suffered no loss of earning capacity. The Supreme Court held that functional disability must be assessed by examining the victim's actual earning capacity in the open, competitive market, rather than merely looking at continued employment in a specially accommodated role. In Priyanka Das's case, the Court ultimately assessed functional disability at 100% despite her continued employment. --- What Happened to Priyanka Das? The accident occurred on 10 April 2011 near Brijghat Bridge. Priyanka Das was travelling as a pillion rider on a motorcycle when a heavy goods vehicle bearing registration number HR-55-2812 hit the motorcycle. The motorcycle rider, Sushant Prabhakaran, died in the accident. Priyanka Das suffered extremely serious injuries. She sustained pelvic fractures and suffered 100% visual disability due to post-traumatic bilateral cortical blindness. Medical evidence also established that she required a permanent colostomy stoma for the rest of her life. At the time of the accident, she was working as a Deputy Group Manager with IBM Daksh, later Concentrix Daksh Services India Pvt. Ltd., in Gurgaon. Despite her injuries, she eventually returned to work. That fact became one of the central issues in determining her compensation. --- The Insurance Company's Argument: "She Is Still Working" The insurer argued that there was little or no loss of earning capacity because the claimant: - continued to be employed; - remained in a managerial position; and - had seen her compensation increase after the accident. The Motor Accident Claims Tribunal initially assessed her functional disability at 60%. One of the reasons was that her Cost to Company had increased from approximately ₹16 lakh to ₹19 lakh per annum after the accident. The Tribunal awarded a total compensation of ₹1,35,53,298. The claimant appealed. The Punjab and Haryana High Court subsequently increased the functional disability assessment to 80% and awarded 50% towards future prospects. The High Court ultimately increased the compensation to ₹2,94,82,617. The matter then reached the Supreme Court. --- Physical Disability vs Functional Disability: What Is the Difference? This distinction is crucial in motor accident compensation claims. Physical disability Physical disability concerns the medical consequences of an injury. For example, a person may suffer blindness, loss of a limb, restricted mobility or permanent damage to an organ. Functional disability Functional disability looks at something different: How does the disability affect the person's ability to work and earn? The percentage of physical impairment and the percentage of functional disability therefore do not necessarily have to be identical. The Supreme Court's reasoning in Priyanka Das places particular emphasis on the victim's actual earning capacity and employability. The Court expressly held: «"The calculation of functional disability depends on assessing the victim's earning capacity in the open, competitive market..."» This is the key principle of the judgment. --- Why Did the Supreme Court Treat the Disability as 100%? The Supreme Court directed a fresh medical examination by a multidisciplinary Medical Board at Vardhman Mahavir Medical College & Safdarjung Hospital, New Delhi. The Board included specialists from areas including neurology, neurosurgery, ophthalmology, general surgery and physical medicine and rehabilitation. Its report dated 28 February 2026 concluded that the claimant had suffered 100% permanent physical impairment of the whole body. The Supreme Court also considered the existing medical evidence. An AIIMS assessment had established 100% visual disability arising from post-traumatic bilateral cortical blindness. Another medical assessment confirmed that restoration of the continuity of the large intestine was not possible and that a permanent stoma was necessary. But the Court did not stop at the medical percentage. It examined what the disability meant for the claimant's working life. --- "She Was Still Working" Was Not the End of the Inquiry One of the most significant pieces of evidence was a Career Growth Letter dated 6 February 2018 issued by the claimant's employer. The letter indicated that although she had joined the organisation in 2003, her career progression had been significantly affected by the accident. The Court noted that her normal career progression—including potential advancement to positions such as General Manager, Director or Vice President—had effectively been lost. There was another important factor. The claimant could perform her existing duties only because of: - specially created software; - flexible working hours; and - extensive workplace accommodations. The Supreme Court described this as support provided by the employer "as an act of corporate compassion." This distinction is extremely important. A person may be able to retain a particular job because an existing employer is willing and able to provide extraordinary support. That does not necessarily mean the person has the same earning capacity as a person without the disability when competing for employment in the wider market. --- The "Open Market" Test The Supreme Court ultimately concluded that the claimant's capacity to independently obtain, retain or advance employment in the open labour market had been entirely extinguished. Consequently, the Court moved from the High Court's 80% functional disability assessment to 100% functional disability. This does not mean that every person who continues working after an accident will automatically be treated as having 100% functional disability. The judgment is based on the particular facts and evidence of this case. The Court itself expressly stated that its exercise in relation to certain components of compensation was based on the peculiar facts and circumstances of the case and should not be treated as a precedent for every individual calculation. The broader principle, however, is important: Courts should examine actual earning capacity rather than mechanically equating continued employment with absence of economic loss. --- How the Supreme Court Calculated the Compensation The Court calculated the claimant's compensation using the following figures: Component| Amount Monthly income| ₹84,057 Annual income| ₹10,08,684 Loss of annual income at 100% disability| ₹10,08,684 Future prospects at 50%| ₹5,04,342 Total annual financial loss| ₹15,13,026 Multiplier| 16 Loss of future earning capacity| ₹2,42,08,416 The Court then added compensation under several other heads, including medical expenses, attendant charges, loss of income during treatment, future medical expenses, pain and suffering, loss of marriage prospects, special diet, loss of amenities and transportation. The final compensation was: ₹3,77,84,297 The Supreme Court also awarded interest at 7.5% per annum from the date of the claim petition until the entire amount was realised. --- What Evidence Can Matter in a Functional Disability Claim? The judgment demonstrates why accident victims should preserve evidence relating not only to their injuries but also to their working life. Depending on the facts of an individual case, relevant evidence may include: 1. Medical evidence Disability certificates, specialist reports, hospital records and Medical Board assessments can help establish the nature and permanence of the injury. 2. Workplace accommodations Evidence showing that the victim requires: - assistive software; - modified equipment; - flexible working hours; - an attendant; - changes to job responsibilities; or - other special arrangements may help demonstrate the practical impact of the disability. 3. Career progression Promotion records and employer correspondence can be important where the accident has affected the person's ability to progress professionally. In Priyanka Das's case, the employer's Career Growth Letter became significant evidence. 4. Loss of future opportunities The relevant loss may not always appear as an immediate reduction in salary. A victim may lose the ability to: - compete for senior positions; - change employers; - take on more demanding responsibilities; - work independently; - work normal hours; - pursue particular occupations; or - maximise future earning potential. --- Does a Salary Increase Mean There Is No Loss of Earning Capacity? Not necessarily. This is one of the clearest lessons from the case. A salary increase after an accident does not automatically establish that there has been no loss of earning capacity. The court may have to consider why the person continues to be employed, what accommodations are required, whether career progression has been affected and whether the person could independently compete for employment in the open market. In Priyanka Das's case, the Court considered all of these circumstances before arriving at its conclusion. --- What Does This Judgment Mean for Accident Victims? For accident victims and their families, the judgment provides an important legal-awareness lesson. If a person suffers a serious permanent disability, the compensation claim should not necessarily be evaluated solely on the question: "How much salary is the victim receiving today?" The more relevant inquiry can be: "How has the accident affected the person's ability to earn over the course of their working life?" That may require looking at medical impairment, functional limitations, workplace accommodations, career progression and the person's ability to compete in the wider labour market. --- Is This Rule Applicable to Every Accident Victim? No. The Supreme Court did not hold that every accident victim who remains employed automatically has 100% functional disability. Functional disability is fact-specific. The nature of the injury, the victim's occupation, age, medical evidence, workplace circumstances, career trajectory and earning capacity can all matter. The strength of the Priyanka Das judgment lies in rejecting a simplistic assumption: "Still employed = no loss of earning capacity." That assumption cannot be applied mechanically. --- Other Important Legal Principles in the Judgment The Supreme Court's decision also dealt with a separate compensation issue arising from the death of Sushant Prabhakaran. The Court reaffirmed that the multiplier for calculating loss of dependency is determined by the age of the deceased, rather than the age of the dependants. Sushant Prabhakaran was 33 years old, and the applicable multiplier was therefore 16 under the established framework in Sarla Verma v. Delhi Transport Corporation, as approved and developed in subsequent Supreme Court decisions including Pranay Sethi, Munna Lal Jain and Sube Singh. This aspect of the judgment is separate from the functional-disability issue and should not be conflated with the claimant's personal-injury compensation. --- Supreme Court Judgment: Key Takeaways The most important points from Reliance General Insurance Company Limited v. Priyanka Das & Ors. are: 1. Continuing employment does not automatically eliminate loss of earning capacity. 2. Functional disability must be assessed with reference to the victim's earning capacity. 3. Open-market employability can be more important than retention in a specially accommodated job. 4. Workplace accommodations may be relevant evidence when assessing the economic impact of a disability. 5. Career progression and future earning opportunities can form part of the assessment. 6. Medical Board findings can play an important role in determining permanent physical impairment. 7. The percentage of physical disability and functional disability are related but distinct concepts. 8. The final assessment remains dependent on the facts and evidence of each case. --- The Legal Takeaway A motor accident can affect much more than a person's present salary. It can affect their independence, career progression, future opportunities and ability to compete for employment. The Supreme Court's judgment in Reliance General Insurance Company Limited v. Priyanka Das & Ors. makes an important point for accident victims: «A person does not necessarily lose their claim for loss of earning capacity simply because they managed to keep their job.» The court must look at the real impact of the disability on the person's ability to earn in the open and competitive labour market. For victims of serious permanent injuries, this means that evidence about workplace accommodations, career progression, future opportunities and actual functional limitations can be extremely important. Case Details Case: Reliance General Insurance Company Limited v. Priyanka Das & Ors. Neutral Citation: 2026 INSC 950 Reported Citation: 2026 LiveLaw (SC) 897 Date of Judgment: 3 September 2026 Bench: Justice S.V.N. Bhatti and Justice N.V. Anjaria Relevant Appeals: Civil Appeal Nos. 12087–12088 of 2026 and Civil Appeal No. 12089 of 2026 Subject: Motor Accident Compensation / Functional Disability / Loss of Earning Capacity Final Compensation: ₹3,77,84,297 Interest: 7.5% per annum from the date of the claim petition until realisation. Frequently Asked Questions Can I claim compensation for loss of earning capacity if I am still employed after an accident? Yes. Continued employment does not automatically establish that there is no loss of earning capacity. The circumstances of employment and the effect of the disability on open-market earning capacity may be relevant. What is functional disability in a motor accident claim? Functional disability concerns the effect of an injury or permanent impairment on the victim's ability to work and earn, rather than simply the medical percentage of physical impairment. Is physical disability the same as functional disability? No. Medical or physical disability describes the physical or medical impairment. Functional disability considers how that impairment affects the person's ability to earn. Can workplace accommodations affect compensation? They can be relevant. If continued employment is possible only because an employer provides significant assistive technology, modified working conditions or other exceptional accommodations, those circumstances may be considered while assessing earning capacity. Can loss of career growth be considered in a motor accident claim? Potentially, yes. Evidence concerning lost promotions or career progression may help demonstrate the impact of a permanent disability on future earning capacity. Did the Supreme Court hold that every employed accident victim has 100% functional disability? No. The 100% assessment in Priyanka Das was based on the particular medical and employment evidence in that case. Functional disability remains fact-specific. How much compensation was awarded to Priyanka Das? The Supreme Court enhanced the compensation to ₹3,77,84,297, with interest at 7.5% per annum from the date of the claim petition until realisation. --- Legal awareness disclaimer: This article is for general informational purposes and does not constitute legal advice. Compensation in an individual motor accident claim depends on the facts, evidence, applicable law and findings of the relevant court or tribunal. The judgment discussed above should be read in its full context before being relied upon in legal proceedings.