Sri Shyamal Gupta, Member

This Appeal is preferred against the Order dated 06-05-2016 passed by the Ld. District Forum, Uttar Dinajpur in CC/61/2014, whereof the complaint has been allowed.

To narrate in brief, case of the Complainants is that, Sunil Mondal, husband and father of the Complainant Nos. 1 and 2, respectively, since deceased, insured the subject vehicle with the OP Insurer.  Said Sunil Mondal died on 08-03-2012.  On 01-12-2012, the insured vehicle got stolen.  The local Police Station was informed of such fact on the very same day.  Thereafter, the Complainants submitted claim form with the OP Insurer along with requisite documents, However, since the said claim was not settled by the OP Insurer, the complaint was filed.

OP Nos. 1&2 contested the case by filing WV.  It is stated by these OPs that it was clearly stated in the policy that after the demise of the original policyholder, the policy would remain in force for 3 months from the date of death of the insured or until the expiry of the policy (whichever is earlier) and during the said period, the legal heirs of the deceased policyholder may apply for  transferring the policy in their names or obtain a new policy for the insured vehicle.  However, the Complainants did not opt for the same. In fact, no such intimation about the death of the original policyholder or the date of the alleged incident was intimated to these OPs in time.  Accordingly, the original insurance policy automatically stood cancelled.  These OPs on 16-01-2014 clearly intimated the reason of repudiation of the instant claim to the Complainants.  They denied any deficiency in service on their part in this regard.

Decision with reasons

At the time of hearing, Ld. Advocates for the parties articulated their views in the matter.  We have also gone through the documents on record.

The Appellant, as it appears, put its foot down to settle the claim on the ground that (1) the Respondent Nos. 1&2 did not apply for transferring the name following the death of the policyholder (2) timely intimation about the peril was not communicated to it by the Respondent Nos. 1&2.

Be it mentioned here that the IRDA, by issuing a Circular bearing no. IRDA/HLTH/MISC/CIR/216/09/2011 dated 20-09-2011 directed all Insurers to decide the fate of claims on sound logic and valid ground.  The Regulator stressed upon the fact that limitation clauses do not work in isolation and is not absolute. The Regulator in the said circular expressed its apprehension that, rejection of claims purely on technical grounds in mechanical fashion would result in policyholders’ losing confidence in the insurance industry, giving rise to excessive litigation. 

In the case in hand, the Appellant has not disputed the authenticity of the peril, but still refused to settle the claim purely on technical grounds. If one sees the conduct of the Appellant through the spectacle of the IRDA Circular mentioned hereinabove, there can be no manner of doubt that the Appellant pay scant regards to Regulatory directives.

It is true that the Respondent Nos. 1&2 ought to apply for transferring the name of the policyholder following the death of original policyholder.  However, there can be no two opinions as to the fact that they had no mal-intention behind not doing so.  Furthermore, there is nothing to show that they were well versed with the terms and conditions of the policy document or the same was explained to them by anyone. Insofar as any intentional laches on the part of the Respondent Nos. 1&2 is not proven beyond reasonable doubt, to our mind, they definitely deserve benefit of doubt. 

Regarding the delay in giving timely intimation to the Appellant, we find that the local police station was apprised of the matter on the very same day when such peril was detected by the Respondent Nos. 1&2.  Since Police is the sole competent authority to investigate such matters, on account of some delay in communicating due information to the Insurance Company, if a claim is repudiated, that cannot be appreciated. After all, sheer technicalities cannot outweigh an otherwise admissible claim. Above all, the IRDA vide its afore-mentioned circular made it clear that a genuine claim cannot be repudiated on account of delayed intimation to the Insurer. In this regard, it may not be out of the place to mention here that in terms of the IRDAI (Protection of Policyholders’ Interests) Regulations, 2002, it is obligatory on the part of the Insurer to settle/reject a claim within one month of receipt of final survey report.   While the Appellant itself flout such Regulatory directives with impunity, it should rather introspect and refrain from finding fault with others.

It is the bounden duty of the Insurance Company to settle genuine claims.  That being not done, the complaint was rightly allowed by the Ld. District Forum.  The same does not warrant any sort of intervention from our end.

The Appeal, accordingly, fails.

Hence,

O R D E R E D

The Appeal stands dismissed on contest, but without any cost.  The impugned order is hereby affirmed.