Introduction

The Dubai Court of Cassation issued a significant ruling (Case No. 41/2025, dated March 27, 2025) that provides important clarification on several aspects of insurance compensation for physical injuries. This judgment reinforces key legal principles regarding bodily harm compensation, judicial discretion in damage assessment, and interest calculation.

Case Summary

The case involved an insurance claim filed by a guardian on behalf of his son, who sustained injuries in a traffic accident. The driver of the insured vehicle was convicted in a separate criminal case (No. 1064/2023). The claimant sought AED 5 million in compensation for material and moral damages resulting from the accident.

The Insurance Dispute Resolution Committee at the UAE Central Bank initially awarded AED 750,000 plus 5% annual interest from the date the judgment became final. Both parties appealed this decision, but the Court of Appeal upheld the Committee’s ruling. The insurance company subsequently appealed to the Court of Cassation, which rejected the appeal and upheld the lower court’s decision.

Key Legal Principles Established

1. Right to Bodily Integrity

The Court of Cassation reaffirmed the fundamental principle that every person has the right to bodily integrity. Any infringement upon this right that results in physical injury constitutes harm requiring compensation, regardless of whether the injury impacts the victim’s earning capacity or results in medical expenses.

The Court emphasized that physical injury is a form of material damage that warrants compensation in its own right, separate from any financial losses it might cause.

2. Comprehensive Approach to Damage Assessment

The Court adopted a holistic view of damages resulting from physical injuries, recognizing that:

• Physical injuries encompass both temporary and permanent disabilities
• Physical harm is inherently accompanied by pain, suffering, and psychological distress
• Moral damages naturally flow from bodily injuries and are compensable separately

This approach aligns with UAE Civil Transactions Law (Federal Law No. 5 of 1985), particularly Articles 292 and 293, which establish the right to compensation for both material and moral damages.

3. Judicial Discretion in Compensation Assessment

A significant aspect of the ruling is the Court’s affirmation of the trial court’s broad discretion in:

• Evaluating evidence, including medical reports
• Determining the elements of damage
• Assessing appropriate compensation amounts

The Court of Cassation held that as long as the lower court’s assessment is based on sound reasoning supported by evidence in the case file, the appellate courts should not substitute their own evaluation. This principle respects the fact-finding role of trial courts and limits grounds for appeal to legal errors rather than mere disagreement with damage calculations.

4. Interest on Compensation Awards

The Court rejected the insurance company’s challenge regarding interest calculations, confirming that:

• Interest on compensation awards runs from the date the judgment becomes final
• Interest represents compensation for the delay in payment
• The 5% annual interest rate was appropriate in this case

This clarification is important for practitioners as it establishes when interest begins to accrue on compensation awards in insurance disputes.

Procedural Aspects

The Court also addressed several procedural arguments raised by the insurance company:

1. The Court rejected the claim that the dispute was filed improperly, emphasizing that the burden of proving procedural irregularities falls on the party alleging them

2. The Court affirmed that assessment of evidence and evaluation of damages are factual matters within the trial court’s discretion

3. The Court established that challenges to factual findings cannot be raised at the cassation level, which is limited to reviewing errors of law

Conclusion

The Dubai Court of Cassation’s ruling in Case No. 41/2025 provides valuable guidance on the legal principles governing compensation for physical injuries in insurance disputes. By emphasizing the inherent value of bodily integrity, the comprehensive nature of damages flowing from physical injuries, and the broad discretion afforded to trial courts in assessing appropriate compensation, the Court has reinforced important protections for accident victims while providing clear parameters for insurance companies in evaluating their potential liability.