Families of three soldiers who were killed in Iraq in poorly-armoured Land Rovers – and those killed in a friendly fire incident – can sue the Ministry of Defence for negligence because soldiers have a "right to life," the supreme court ruled.

The ruling means soldiers heading into battle overseas can claim protection under article 2 of the Human Rights Act – a decision the defence secretary Philip Hammond said could leave operational decisions in combat zones open to "the uncertainty of litigation".

The court ruled that the doctrine of combat immunity – which prevents soldiers from claiming compensation for injuries received in combat except under official schemes – should be interpreted "narrowly" and should not be extended to cover "the planning of and preparation for active operations against the enemy".

The ruling is a victory for the families of servicemen killed in Iraq – who are likely to be able to claim payouts of about £250,000 each. Many have spent years trying to find out what happened to their relatives and are challenging the army over the standard of kit issued.

One group of claims was brought by families of three men killed when their poorly-armoured Snatch Land Rovers were destroyed by roadside bombs. Private Lee Ellis, 23, of Wythenshawe, Greater Manchester, Private Phillip Hewett, 21, of Tamworth, Staffordshire, and Lance Corporal Kirk Redpath, 22, of Romford, Essex, died between 2005 and 2007.

Jocelyn Cockburn, the solicitor who represented Susan Smith, Hewett`s mother, said: "What has been established is that soldiers do have human rights and remain within the jurisdiction of the UK when abroad. Whether there has been a breach of those rights is a different question that will now go to court. There`s now a duty on the government to protect its soldiers from known risks." Outside the court, Smith said: "We have won at last. To be honest we didn`t expect to. The MoD will now have to make sure our soldiers are safe abroad. What we have done will make a lot of difference to people in the future. There will have to be protection in place. Phillip is dead. Nothing is going to bring him back. But there are other boys out there."

But Hammond said he was "very concerned" at the wider implications of the judgment, which "could ultimately make it more difficult for our troops to carry out operations" and "throws open a wide range of military decisions to the uncertainty of litigation". He added: "It can`t be right that troops on operations have to put the [European Convention on Human Rights] ahead of what is operationally vital to protect our national security."

A second group of claims was lodged by the families of those killed and injured in a Challenger tank in March 2003 as a result of friendly fire. Corporal Stephen Allbutt, 35, of Stoke-on-Trent, Staffordshire, was killed and several others injured.

Shubhaa Srinivasan, from the law firm Leigh Day who represents the claimants, said: "The highest court in the land has ruled the MoD, as employer, must accept that it owes a duty of care to properly equip service personnel who go to war. We have constantly argued that the MOD`s position is morally and legally indefensible."

Andrea Coomber, director of the organisation Justice, which intervened in the case, said: "The human rights of UK troops should be protected wherever they serve. The government`s case would have had them shoulder the burdens of serving this country, but not protected by its most fundamental safeguards." A decision at the European court of human rights in 2011 on the al-Skeini case, relating to Iraqi civilians who died in areas under British military control, set a powerful precedent. If Iraqi civilians were deemed to have human rights and be under UK jurisdiction, lawyers for the soldiers` families argued, then the troops themselves should not be denied such legal protection.

The individual claims for negligence and breach of human rights will now return to the high court to be examined in detail. The supreme court ruling is likely to stimulate further legal actions involving allegedly inadequate or missing military equipment. If claims for compensation are fought families could, lawyers suggested, receive up to £750,000 between the three Land Rover victims.