By Sri. MOHANDASAN.K, PRESIDENT
The case of the complainant is as follows: -
1. The complainant is the registered owner of vehicle No. KL 10/AX 7000. The agent of opposite party one Mr. Shaji.P persuaded the complainant to avail the insurance policy of the opposite party stating that the opposite party is providing best insurance coverage comparing to the all-other insurance companies. The complainant enquired about the same and convincing the same availed insurance policy of the opposite party. The policy No was VPC 1314180000102, which is a private car package policy and the same is valid from 17/04/2022 to 16/04/2023. The complainant remitted total premium of Rs. 50,641/-. But the complainant submitted that the opposite party or the agent did not have issue the policy copy or the terms prior to the issuance of insurance policy.
2. On 09/09/2022 at about 1.30 hours in the night while the complainant was driving the vehicle from Calicut to Kondotty, Millumpadi vehicle met with an accident at Kuriyedam. At the place of accident one dog suddenly cut across the road and to avoid the hitting against the dog the complainant swerved the vehicle and the vehicle went off the road and thereby hit against a compound wall of one Mr. Muhammed Salim. P.K, S/o Abdullakutty, Pandarakandi House, Kuriyedam. The vehicle sustained damages but the complainant was not sustained any injuries.
3. Immediately after the accident the complainant informed the same to the opposite party and in accordance with the direction of the opposite party vehicle was taken to Amana Toyoto, Cheruvannur, Kolathara the service centre. The accident was reported to the police station. But no injuries being sustained in the accident the police registered the incident in the general diary and no case was registered.
4. Since the opposite party did not initiate any process for repair of the vehicle, the complainant approached the opposite party and requested to commence the process for repair work. Then it was informed a surveyor is to be deputed for making report but the opposite party did not inform the complainant about the surveyor who is appointed for the inspection of the vehicle or even the report of the survey. On enquiry with the Amana Toyota service center the complainant learned that nobody has turned to inspect the vehicle or not inspected the vehicle. The complainant submit that the damages of the vehicle was not inspected by the insurance surveyor and no report was prepared. Hence the act of the opposite party amounts deficiency in service.
5. The complainant submitted that the opposite party caused a notice dated 23/09/2022 stating that the repair cost of the vehicle as per claim No.PV00948688 exceeds insured sum of Rs.17,45,550/- and so the company is prepared to consider the same as constructive total loss and the vehicle is prepared to purchase by one Mr. Michael Benedict is for Rs.20,32,000/- and so the complainant is directed to hand over the vehicle along with registration certificate within 7 days from the date of notice and if the complainant failed to do so the opposite party is exonerated from all the liabilities. The complainant astonished on receipt of notice. The complainant enquired before the Toyota workshop and they stated that the repair cost will be only Rs.8, 98,880/-. In addition to that the repair center had issued an estimate also to the complainant. Then the complainant informed the opposite party that he is not ready to handover the vehicle as per treatment of constructive total loss and requested to issue copy of survey report to the complainant. Though the opposite party received the notice did not issue reply or the copy of survey report to the complainant. The complainant specifically submitted that the opposite party did not appoint surveyor or examine the damages of the vehicle. The complainant submitted that his vehicle worth rupees more than Rs.25,00,000/-. The attempt of the opposite party is to take away the vehicle from the complainant and thereby to cheat him. Thereafter the opposite party issued a notice to the complainant dated 12/10/2022 stating that the repair cost of the vehicle is exceeding 75% of IDV value and so the vehicle cannot be repaired. Though the complainant informed the service center of Toyota company is ready to repair the vehicle for Rs.8,98,882/-, the opposite party did not heed the request of the complainant.
6. The complainant thereafter approached one insurance surveyor and loss assessor holding IRDA license Mr. Naufal Benglath and he duly prepaid a report after examination of the vehicle. The surveyor’s examination was duly informed the opposite party also. As per his survey report the repair cost is only Rs. 6,05,470/-. The Kannnadkandy motors, VVK menon Kallai, Calicut also expressed willingness to repair the vehicle for the above said amount. Complainant informed the same to the opposite party through a notice dated 23/11/2022. On 07/12/2022 the opposite party sent a reply to the notice stating that the repair cost is more than 75% and the vehicle is liable to be handed over to the person suggested by the opposite party and the opposite party is prepared to record no claim accordingly. Further it was informed that they are cancelling the insurance policy also. The complainant was wondered on receipt of the notice from the opposite party. The complainant was sent estimate, survey report quoting lowest expense but the opposite party did not accept the same and thereafter cancelled the policy recording no claim caused much mental agony to the complainant. The act caused a lot of inconvenience and hardship to the complainant.
7. The complainant submitted that he repaired the vehicle spending 6,05,470/-. Thereafter the complainant approached the opposite party for the refund of the repair cost. But the opposite party denied the same. Due to the act of the opposite party the complainant was constrained to avail special conveyance and thereby caused a lot of inconvenience and hardship. Hence, he prays for a compensation of Rs.3,00,000/- from the opposite party. The complainant alleged the opposite party did not issue notice prior to the cancellation of the policy and submitted that the complainant never violated the condition of the insurance policy. Moreover, the opposite party did not issue balance premium since the opposite party closed the insurance policy unilaterally. The act of the opposite party amounts violation of the policy condition and deficiency in service also unfair trade practice. Hence the prayer is to refund the repair cost of 6,05,470/- along with compensation of Rs.3,00,000/- and cost of Rs.50,000/-.
8. On admission of the complaint notice was issued to the opposite party. The opposite party entered appearance and filed version denying the entire averments and allegations in the complaint. It is submitted that the complaint is false, fabricated and ill motivated only to sustain this complaint and obtain undeserved benefits. According to opposite party the complaint is not maintainable in law as the person who is entitled, competent and authorized to represent the opposite party company is not made party to this complaint.
9. The opposite party admitted that the complainant is the RC owner of the vehicle with registration No. KL 10 AX 7000 that the vehicle was insured from 17/04/2022 to 16/04/2023 vide policy No. VPC 1314180000102 issued by the opposite party that the insured vehicle met with an accident while driven by the complainant on 09/09/2022 that the police has noted the incident only in the station general diary as no personal injury or death was caused.
10. The opposite party denied the entire averments and allegations except as stated supra. The opposite party submitted that all relevant information as to the terms and conditions of the policy are available in the public domain and published on the website of the company www.royalsundaram.in, direct telephonic helplines provided to customers who need any clarification.
11. The opposite party submitted a claim was intimated by the repairer on 12/09/2022 with regard to the damages occurred to the subject insured vehicle on 09/09/2022. The repairer VPK Motors private limited has prepared the estimation on 10/09/2022 at the cost of Rs.12,88,971.20 (without tax). An IRDA licensed surveyor Mr. Ramesh Prabhu. K with license No. 74780 was deputed to insect the damaged vehicle and to assess the loss sustained by the insured vehicle. As per his report dated 15/09/2022 he assessed that the vehicle sustained severe and extensive structural and other damages and hence the cost of repairs with OEM parts and labor to restore the accidented vehicle to its original pre accident condition would cost Rs.14,45,838/- which exceeds 75% of the insured declared value as assessed the net assessment value of Rs.14,45,838 (including tax). Thereafter opposite party on application of mind, considering all aspects particularly the financial implications of the accident and its commercial result decided to treat the vehicle as having sustained “constrictive total loss on account severity of collision. Since the liability value crosses the 75 % of the total IDV as per the terms and conditions of the policy under section 1 the claim was considered under “Constructive total loss”. It is submitted that the opposite party through his network of agents and associates obtained an offer of Rs. 20,32,000/- for wreck with the RC on an as is where is condition from one Mr. Michael Benedict valid only for a limited period of 7 days (value get decreased due to depreciation) which was accepted by the opposite party and hence the complainant duly informed as per office letter dated 23/09/2022 directing the complainant to surrender the wreck and also receive Rs.20,32,000/- which is more than the entire IDV was applicable / payable. It is also specifically mentioned that if it not handed over to the buyer within stipulated time of 7 days the opposite party shall not be liable for any further deterioration loss of the same, nor guaranty that the wreck would fetch the same value in a future and quoted the relevant condition No. 4 of the terms and conditions of the policy. It is submitted that there was no delay in processing the claim and also closed the claim. The complainant was acknowledged the same and he was served notices dated 23/09/2022 and 07/12/2022.
12. The complainant displayed obduracy and willful recalcitrance to comply with the aforesaid direction and approached the opposite party on 23/11/2022 that he will be paid for repair of the vehicle which conduct on his part as no legal basis or support given the facts of this particular case. The opposite party stresses, emphasis and reiterate that since the repair liability furnished to the opposite party by the authorized licensed surveyor exceeded 75% of the IDV, the opposite party was will within its right under the contract of insurance to exercise the rights to declare the vehicle as constructive total loss and sell the wreck to the highest bidder as done in this case and the same was communicated to the complainant vide letter dated 07/12/2022 and so the complainant has no surviving grievance or legal grounds to question or challenge that fair / commercial decision taken in good faith whereby the insured / complainant would receive the entire IDV of his vehicle without any depreciation and hence obtained full and complete restitution under the contract of insurance without any grounds to sustain this complaint. It is submitted the alleged survey carried out on behalf of the complainant is without notice to the opposite party company and in any case the survey report is neither final nor binding on the insurer however the complainant is put to strict proof of the same. The opposite party submitted they did not receive any request for the survey report from the complainant. The report is prima facie from the arbitrary, unrealistic amount shown in the said report which is erroneous, in correct and not reliable.
13. The opposite party contended the decisions of the opposite party was just, fair and equitable to both parties causing neither loss ought to have been agreed to and accepted by the complainant had he been properly advised and he would have received the price more than the IDV amount as per the policy. Hence the submission is there is no cause of action arose or existed against the opposite party nor was there any deficiency in services as alleged by the complainant.
14. The opposite party further submitted that the fundamental objective of an insurance contract is to place the assured in the same financial position in which he would have been if no loss had occurred and nothing more. As per the marine insurance act, the indemnity provided by the insurer is “in the manner and extend agreed to “which in this case is the IDV and is what is called in insurance parlance “an agreed value policy” which is thus conclusive and binding on parties. On payment of the full sum assured (that is IDV) the insurer steps in to the shoes of the insured and takes over all his rights by virtue of having full filled his obligations under the contract and if necessary tiled to subrogation of rights. In this case there is no case for the complainant the offer made by Mr. Michel Benedict was not genuine, inadequate or in collusion etc. which clearly estops complainant from questioning the insurer right to pay the sum assured as per agreed value and claim abandonment with title of the wreck (RC) subject of insurance.
15. The intimation cum closure letter dated 09/09/2022 and 07/12/2022 issued by opposite party was entirely justified as it was lying in un road worthy condition subject to various risks in capable of use and hence there was no reason to continue the indemnity cover the under the policy and hence the action of the opposite party cannot be faulted nor is it illegal.
16. It is further submitted that the place where the vehicle was allegedly repaired is not an authorized Toyota dealer and any repairs spuriously done would not put the vehicle in road worthy or insurance condition. The complainant has not submitted any bills towards the repair. Hence opposite party does not admit any of the claims or averments as to expenses incurred for repairs by the complainant nor is the opposite party contractually bound to pay for any such expenses nor is the complainant legally entitled to any relief in that regard. Moreover the vehicle involved in this complaint was manufactured and registered in 2017 and hence was more than 5 years old at the time of accident with its odometer reading 94,000 odd kilometers. As per the terms of insurance contract, the maximum monitory benefit / pay out under written by the opposite party company by the said policy was Rs.17,45,550/ and the insured / complainant has no contractual or statutory right to claim anything else. The opposite party has full filed all the contractual obligations to the later no breach was committed and the complainant offered full satisfaction. The opposite party denied the allegation that terms of the policy were not explained to the complainant but the complainant itself admitted then he made several enquires in person with the offices of the opposite party and so the complaint is experimental, frivolous and not sustainable. The prayer of opposite party is to dismiss the complaint with exemplary cost of Rs.50,000/- and also direct to pay Rs.35,000/-as legal cost .
17. The complainant and opposite party filed affidavit and documents. The documents on the side of complainant marked as Ext. A1 to A12 and the documents on the side of opposite party marked as Ext. B1 to B6. Ext. A1 is copy of insurance policy issued by the opposite party to the complainant with policy No.VPC 1314180000102 for the period 17/04/2022 to 16/04/2023. Ext. A2 is copy of general diary entry 13 – 09/09/2022/ Kondotty police station. Ext. A3 is copy of motor insurance claim form No. 10092022 dated 12/09/2022. Ext. A4 is copy of letter issued by Royal Sundaram general insurance to the complainant dated 23/09/2022. Ext. A5 is copy of lawyer notice issued by Adv. P.E. Mossa to Royal Sundaram General insurance limited dated 06/10/2022. Ext. A6 is copy of letter issued by Royal Sundaram General Insurance to the complainant dated 12/10/2022. Ext. A7 is copy of letter issued by the complainant to the Manager Royal Sundaram general insurance dated 23/11/2022. Ext. A8 is copy of quotation for the accident vehicle dated 31/10/2022. Ext. A9 is copy of surveyor assessment details including photographs dated 09/11/2022. Ext. A10 is copy of letter issued by Royal Sundaram General Insurance dated 07/12/2022 to the complainant. Ext. A11 is copy of tax invoice issued by Kannankandy motors, Kallai, Kozhikode. Ext. A12 is copy of quotations issued by Kannaknady motors to complainant dated 27/01/2023 and 09/02/2023. Ext. B1 is copy of certificate of insurance and policy No.VPC 1314180000102 for the period 17/04/2022 to 16/04/2023. Ext. B2 is motor insurance claim form dated 12/09/2022 numbered 10092022. Ext. B3 is copy of estimate issued by Toyota dated 12/09/2022. Ext. B4 is copy of final survey report dated 15/09/2022 submitted by MR. Ramesh Prabhu. K, surveyor and loss assessor. Ext. B5 is copy of letter issued by the opposite party to the complainant dated 23/09/2022. Ext. B6 is copy of letter issued by the opposite party to the complainant dated 07/12/2022.
18. Heard complainant and opposite party, perused affidavit and documents. The following points arise for consideration: -
- Whether there is deficiency in service on the side of opposite party?
- Whether there is unfair trade practice on the side of opposite party?
- Relief and cost?
19. Points No.1 and 2
The opposite party admitted that the complainant is the registered owner of the vehicle KL 10 AX 7000 and the vehicle is insured with the opposite party as per policy No.VPC 1314180000102 valid from 17/04/2022 to 16/04/2023. It is also not disputed that the vehicle met with an accident while driving by the complainant on 09/09/2022 and the police had noted the incident only in the station general diary as no personal injury or death was caused in the accident. But the opposite party disputed the entire claim of the complainant.
20. The submission of the opposite party is that the claim of the complainant was intimated by the repairer on 12/09/2022 with regard to the damages caused to the vehicle on 09/09/2022 and the repairer VPK motors private limited prepared the estimate on 10/09/2022 itself and the cost assessed was Rs.12,88,971/-. Moreover, IRDA licensed survey Mr. Ramesh Prabhu. K was deputed to inspect the damaged vehicle and his assessment was for Rs.14,45,838/-. The said amount being exceeding 75% of the insured declared value the opposite party decided to treat the vehicle as having sustained constructive total loss on account of severity of the collision. Thereafter the opposite party through its network agents and associates obtained an offer of Rs.20,32000/- for wreck with registration certificate on an as is where is condition from one Mr. Michel Benedict valid only for a limited period of 7 days which was accepted by the opposite party and hence the complainant duly informed as per opposite parties letter dated 23/09/2022 directing the complainant to surrender the wreck and also receive Rs.20,32,000/- which is more than the entire IDV as applicable for the payable. It was further mentioned if it is not handed over within stipulated time of 7 days the opposite party shall not be liable for any further deterioration loss of the same, nor guaranty that the wreck would fetch the same value in future and quoted the relevant condition No.4 of the terms and conditions of the policy. The opposite party submitted there is no delay in processing the claim and closed the same. According to the opposite party the decision of the opposite party was just, fair and equitable to both parties causing neither losses and ought to have been agreed to and accepted by the complainant. The opposite party contended strict adherence to the terms of insurance contract and the provisions of marine insurance Act and the relevant condition No.4 of the terms and conditions of the policy.
21. But the complainant refused to accept the offer of the opposite party to hand over the wreck with RC for an amount of Rs.20,32,000/- contending that his vehicle is worth more than that amount. As per the policy produced by the parties the IDV of the vehicle is only Rs. 17,45,550/-. But the wreck value offer is 20,32,000/- which is apparent that wreck value is considerably higher than the Insured Declared Value. So, it can be seen that the wreck value is more than 2,86,450/-of the Insured Declared Value. The opposite party contended that in the matter of total loss declared cases the entitlement of insured is the amount after the wreck value. It is interesting to note that the wreck value is more than the Insured Declared Value and so the complainant is entitled to get enriched after getting damages to his vehicle. So, the contention of the opposite party as far as this complaint is concerned cannot be accepted as such. A vehicle cannot have sale value after it is damaged. The opposite party did not explain the reason for higher wreck value of the vehicle than that of IDV. It can be inferred that the Insured Declared Value was not properly assessed or subsequent to the inception of insurance policy there may be additional fittings to the vehicle. In short, the Commission finds that the declaration of IDV was unilateral and unfair one. It is relevant to note that the complainant was not provided policy conditions prior to inception of policy.
22. In this complaint the opposite party contended that the damaged vehicle was inspected by licensed surveyor and loss assessor and submitted Ext. B4 report. It is also further contended the service center VPK Motors issued estimate Ext. B3. Both are suggesting more than 75% of Insured Declared Value as repair cost. According to opposite party, in the light of the above Ext. B3 and B4 documents, they decided to declare constructive total loss in the matter. On the other hand, the complainant produced Ext. A8 and A11 documents revealing the estimates for repairing the vehicle which is prepared by yet another service centers. Moreover, complainant produced Ext. A9 which is also a survey report prepared by one Mr. Naufal Bengalath, insurance surveyor and loss assessor. Ext.A8 and A11 and also A9 suggest lessor amount as repair cost against Ext. B3 and B4. Normally the insurance company is prepared to accept a survey report for repair which suggest lesser amount. But in this case the insurance company was not prepared to accept the assessment which quoted lesser amount. The opposite party submitted that the insurance surveyor of complainant did not give notice prior to inspection of vehicle. The complainant also contended that the opposite party surveyor did not inform the inspection of vehicle. It is contented that the surveyor even did not inspect the vehicle. There is no proper and valid explanation from the side of opposite party for not accepting Exts.A8, A11 and A9.
23. It is also evident that the opposite party closed the claim of complainant on the ground that the complainant did not accept direction to hand over the wreck with RC to the third party for an amount of Rs.20,32,000/-. The complainant also contended that the opposite party did not refund the premium charge subsequent to the closure of insurance policy. The submission of complainant is that the opposite party did not issue any notice prior to termination of insurance policy. It can be seen that there is no document from the side of opposite party to revert the contention of the complainant. Hence, the Commission finds that there is apparent in justice from the side of opposite party and there is deficiency in service as well as unfair trade practice. The opposite party did not allow the insurance claim to repair the vehicle of the complainant holding that the wreck value has got higher than that of IDV and so there is no liability on the side of insurance company to the complainant. The opposite party terminated the insurance policy against the terms and conditions of insurance policy. There is no sufficient reason to cancel the insurance policy since there is a dispute between the complainant insured and insurer. Simply holding that wreck value on higher side than that of IDV has been offered to the complainant is not reason close the claim of complainant. The declaration constructive total loss is not properly done in the matter, but is done in a hasty way. The survey report produced by the complainant is equally valid like the report furnished by the opposite party, and so the Commission finds the practice of the opposite party as unfair one and so the complainant is entitled relief under the provisions of Consumer protection Act.
24. Point No.3
The claim of the complainant is that to refund the expense met by the complainant for repair of the vehicle and also to pay compensation of Rs.3,00,000/- with cost of Rs. 50,000/-. It is an admitted case of the opposite party that the repair cost exceeds 75% of the Insured Declared Value and so there is no reason to dispute that the complainant incurred an amount of 6,05470 rupees for repairing the vehicle. The complainant is entitled for the repair cost as prayed. The opposite party refused the genuine claim of the complainant and also closed the insurance claim without due consideration of request of the complainant. The complainant submitted that the opposite party is liable to refund the premium amount after the closing period of insurance to till date of expiry of the policy. We find there is merit in the contention. Hence the commission direct opposite party to pay rupees 1,50,000/- towards the compensation on account of deficiency in service and unfair trade practice from the side of opposite party. The Commission also allow Rs.10,000/- as cost of the proceedings.
In the light of above fact and circumstances we allow this complaint as follows: -
- The opposite party is directed to pay Rs. 6,05,470/- (Rupees six lakh five thousand four hundred and seventy only) to the complainant towards the repair cost of the vehicle.
- The opposite party is directed to pay Rs. 1,50,000/- (Rupees one lakh fifty thousand only) to the complainant on account of deficiency in service and unfair trade practice from the side of opposite party and thereby caused inconvenience and hardship to the complainant.
- The opposite party is directed to pay Rs. 10,000/- (Rupees ten thousand only) to the complainant towards the cost of the proceedings.
The opposite party shall comply this order within one month from the date of receipt of copy of this order, failing which the complainant is entitled 12% interest per annum for the above said entire amount from the date of order to till payment.
Dated this 27th day of February, 2024.
MOHANDASAN K., PRESIDENT
PREETHI SIVARAMAN C., MEMBER
MOHAMED ISMAYIL C.V., MEMBER
APPENDIX
Witness examined on the side of the complainant: Nil
Documents marked on the side of the complainant: Ext.A1 to A12
Ext.A1: Copy of insurance policy issued by the opposite party to the complainant with
policy No.VPC 1314180000102 for the period 17/04/2022 to 16/04/2023.
Ext.A2: Copy of general diary entry 13 – 09/09/2022/ Kondotty police station.
Ext A3: Copy of motor insurance claim form No. 10092022 dated 12/09/2022.
Ext A4: Copy of letter issued by Royal sundaram general insurance to the complainant
dated 23/09/2022.
Ext A5: Copy of lawyer notice issued by Adv. P.E. Mossa to Royal Sundaram Gnerala
insurance limited dated 06/10/2022.
Ext.A6: Copy of letter issued by Royal SundarAm General Insurance to the
complainant dated 12/10/2022.
Ext.A7: Copy of letter issued by the complainant to the Manager Royal sundaram
general insurance dated 23/11/2022.
Ext A8: Copy of quotation for the accident vehicle dated 31/10/2022.
Ext A9: Copy of surveyor assessment details including photographs dated 09/11/2022.
Ext A10: Copy of letter issued by Royal Sundaram General Insurance dated
07/12/2022 to the complainant.
Ext.A11: Copy of tax invoice issued by Kannankandy motors, Kallai , Kozhikode.
Ext.A12: Copy of quotations issued by Kannaknady motors to complainant dated
27/01/2023 and 09/02/2023.
Witness examined on the side of the opposite party: Nil
Documents marked on the side of the opposite party: Ext. B1 to B6
Ext.B1: Copy of certificate of insurance and policy No.VPC 1314180000102 for the
period 17/04/2022 to 16/04/2023.
Ext.B2: Motor insurance claim form dated 12/09/2022 numbered 10092022.
Ext.B3: Copy of estimate issued by Toyota dated 12/09/2022.
Ext.B4: Copy of final survey report dated 15/09/2022 submitted by MR. Ramesh
Prabhu . K, surveyor and loss assessor.
Ext.B5: Copy of letter issued by the opposite party to the complainant dated
23/09/2022.
Ext.B6: copy of letter issued by the opposite party to the complainant dated 07/12/2022.
MOHANDASAN K., PRESIDENT
PREETHI SIVARAMAN C., MEMBER
MOHAMED ISMAYIL C.V., MEMBER
