A hearing before the Supreme Court of India on a compensation dispute arising from a 2017 road accident in Odisha has expanded into a broader inquiry into an alleged insurance fraud network in the state, with the bench observing that “shocking facts” had surfaced during the probe.
The matter stemmed from a petition filed by a public sector general insurance company challenging a May 19, 2022 order of the Orissa High Court, which had directed payment of ₹39 lakh to three claimants in connection with a motor accident in Kendrapada district.
The insurer argued that the vehicle identified as the offending vehicle had been cited in multiple accident cases and was allegedly falsely implicated in the present claim because it carried valid insurance coverage. According to the company, this may have been done to secure compensation fraudulently.
Taking serious note of the allegations, the apex court on December 15 directed Odisha authorities to verify whether the claims of fabrication were genuine.
During a hearing on February 5, Advocate General Pitambar Acharya, appearing via video conference, presented a compliance affidavit on behalf of the state. The affidavit stated that while the vehicle had been linked to four other accident cases, an inquiry in the Kendrapada matter confirmed its involvement in the 2017 accident.
However, proceedings took a wider turn when the Advocate General informed the court that a team of senior officers was investigating what appeared to be a “wide racket” potentially involving multiple stakeholders. Several arrests have already been made, and further action — including interrogations after obtaining necessary approvals — is underway.
Observing that the alleged “illegal activity may not be limited to the State of Odisha,” the two-judge bench of Justices Ahsanuddin Amanullah and Prasanna B. Varale directed the petitioner to provide a comprehensive list of insurance companies operating across sectors such as motor, medical, life, crop, fire and marine insurance. The case has been scheduled for further directions on March 18, 2026.
Despite the broader concerns, the court declined to interfere with the compensation awarded to the three claimants. It directed the Motor Accident Claims Tribunal (MACT), Cuttack, to ensure that the full amount as ordered by the High Court is disbursed within four weeks. The insurance company informed the court that the entire sum had already been deposited before the MACT, with a portion of it released to the beneficiaries.
In the compliance affidavit, Odisha DGP (CID-CB) Vinaytosh Mishra revealed that between 2019 and 2025, authorities examined 104 suspected fake insurance claim cases. Of these, five were ordered for re-investigation, 25 were reopened, and 40 FIRs were registered. In 34 cases, allegations could not be substantiated.
The Supreme Court’s observations have now placed the spotlight on what could be a larger pattern of fraudulent insurance claims, potentially extending beyond Odisha, as the investigation continues.
