Delhi

North East

CC/79/2016

Subhash Chandra - Complainant(s)

Versus

National Ins. Co. Hero Motorcorp Hub - Opp.Party(s)

28 Jan 2019

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM: NORTH-EAST

GOVT. OF NCT OF DELHI

D.C. OFFICE COMPLEX, BUNKAR VIHAR, NAND NAGRI, DELHI-93

 

Complaint Case No. 79/16

 

In the matter of:

 

	Sh. Shubash Chandra S/o Gyan Dev R/o B-4, Tilak Gali New Usmanpur, Delhi-110053	Complainant
	Versus
	National Insurance Co. Ltd Hero Motor Corp hub C.M.C. House, N-1 Connaught Place, New Delhi-110001	Opposite Party

 

DATE OF INSTITUTION:      JUDGMENT RESERVED ON:               DATE OF DECISION      :

09.03.2016 28.01.2019 28.01.2019

 

 

 

N.K. Sharma, President

Ms. Sonica Mehrotra, Member

 

Order passed by Ms. Sonica Mehrotra, Member

 

ORDER

1. Briefly stated fact relevant for disposal of the present complaint are that the complainant had purchased a Hero Splendor Plus motor cycle bearing Regn. NO DL5SAQ0715 from Aman Motor and got the same insured with OP under Two Wheeler Policy bearing no 39010231146202887663 w.e.f. 11.11.2014 to 10.11.2015 for total IDV of Rs. 42,275/- on payment of premium of Rs. 1,403/- to OP. However, the subject bike got stolen on 22.06.2015 in front of the complainant’s house against which the complainant lodged FIR bearing no 005250 on 23.06.2015 u/s 379 IPC with PS Usmanpur Delhi. But due to inability of the concerned police station to locate the said bike for more than a month, the said police station asked the complainant to go to crime branch office at Kamla Market Delhi to obtain the untraced report and to procure the same from the concerned department, it took another one an half month when finally the untraced report was mailed to the complainant on 14.09.2015. After obtaining untraced report, the complainant visited the office of OP for process of his insurance claim but was declined the same by the officers of OP on grounds of delay in intimation of theft. Therefore, the complainant was constrained to file the present complaint before this Forum praying for issuance of direction to the OP to process the insurance claim of the complainant and to pay a compensation of Rs.10,000/- towards mental harassment.
2. The complainant had attached the copy of insurance certificate / cover note for the subject bike insured with OP, copy of FIR 23.06.2015, copy of 64 VB compliance dated 28.09.2015 received by OP on 15.10.2015, copy of untraced report / order dated 14.09.2015 digitally signed by Hon’ble DSJ and copy of repudiation letter dated 15.10.2015 by OP to complainant rejecting the claim as “No Claim”.
3. Notice was issued to the OP on 28.03.2016. OP filed its written statement on 27.05.2016 in which, while admitting the factum of insurance of the subject bike by complainant with itself and theft and FIR for the same on 21.06.2015 and 23.06.2015 respectively, took the preliminary objection that since the complainant had given the intimation of theft on 15.10.2015 i.e. after a huge delay of about 4 months from the date of loss / theft, such late intimation is clear violation of term and condition number 1 of the policy which required immediate notice in writing to the company on occurrence of any accidence and in view of complainant’s negligence to do so, the OP had rightly repudiated his claim vide letter dated 15.10.2015. Lastly, the OP urged that since the non intimation by the complainant was intentional / deliberate only to get unjustified claim and compensation, the present complaint was not maintainable and therefore liable to dismissed.
4. The complainant filed evidence by way of affidavit exhibiting the policy, the FIR, untraced report and 64 VB compliance certificate therewith.
5. Evidence by way of affidavit was filed by OP reiterating its defence taken in written statement and exhibited terms and conditions of the policy as EX. RW1/1.
6. Written arguments were filed by both complainant as well as OP to reinforce their respective grievance / defence. OP during the course of oral arguments, placed on record judgments of Hon’ble NCDRC in National Insurance Company Ltd, v. Vijay Kumar Jain I (2015) CPJ 387 (NC) in which the Hon’ble National Commission upheld the repudiation of claim in view of inordinate delay of five days in lodging FIR and delay of about six months in intimation to the insurance company by the complainant. The OP further placed reliance on the judgment Hon’ble NCDRC in Pradeep Kumar Tiwari v. Oriental Insurance Company Ltd. and ANR I (2017) CPJ 493 (NC) in which the Hon’ble National Commission held that the insured was under a contractual obligation to intimate the theft of the vehicle to the insurer immediately after the theft came to his knowledge and since there was substantial delay in intimating the theft of the vehicle to insurance company, the insurer was entitled to repudiate the claim.

At the time of oral arguments, complainant argued that the reason for delay in intimation to OP about the said theft was that after lodging of FIR with the concerned police, the complainant got caught up with the follow up process with the police to trace the subject bike and further the concerned police took a very long time and caused delay in providing the untraced report after which only the complainant knock the doors of OP for process of theft claim.

We have given thoughtful consideration to the arguments advanced by both the parties and have examined record before us.

The factum of the insurance of the subject vehicle and theft thereof is not in dispute. The issue is that of delayed intimation of the factum of theft to the insurance company which the complainant has also not denied as can be seen from the documentary evidence before us.

It is a settled legal proposition enunciated in a catena of judgments made by the Hon’ble Apex Court and Hon’ble National Commission in cases involving violation of the terms and conditions of the policy, that 75% of the amount of claim was to be paid on ‘non-standard basis’. The Hon’ble Supreme Court in Amalendu Sahoo v. Oriental Insurance Co. Ltd., II (2010) CPJ 9 (SC) = II (2010) SLT 672, has laid down the guideline for payment of 75% of the admissible claim for any breach of conditions of insurance policy / warranty etc. i.e.  violation of condition of Motor Policy, as also in National Insurance Co Ltd v. Nitin Khandelwal IV (2008) CPJ 1 SC in which the Hon’ble Supreme Court observed that “ in the case of theft of vehicle , breach of condition is not germane. The appellant insurance company is liable to indemnified the owner of the vehicle when the insured has obtained comprehensive policy for the loss caused to the insured ” as has been followed by Hon’ble National Commission in New India Assurance Company Ltd v. Narayan Prasad Appaprasad Pathak II (2006) CPJ 144 (NC).

Further IRDA circular dated 20.09.2011 vide reference no IRDA/ HLTH/MISC/CIR/216.9.2011 states that the condition of giving intimation to the insurer within a specified number of days should not prevent settlement of genuine claims, if there was delay in intimation due to unavoidable circumstances. The said circular issued following direction to the insurance company. :

The insurers’ decision to reject a claim shall be based on sound logic and valid grounds. It may be noted that such limitation clause does not work in isolation and is not absolute. One needs to see the merits and good spirit of the clause, without compromising on bad claims. Rejection of claims on purely technical grounds in a mechanical fashion will result in policy holders losing confidence in the insurance industry, giving rise to excessive litigation. Therefore, it is advised that all insurer need to develop a sound mechanism of their own to handle such claims with utmost care and caution.  It is also advised that the insurers must not repudiate such claims unless and until the reasons of delay are specifically ascertained, recorded and the insurers should satisfy themselves that the delayed claims would have otherwise been rejected even if reported in time.

Nowhere does the IRDA letter stipulate that 48 hrs timeline is mandatory for informing the insurance company and the above said circular was issued after passing of Parvesh Chander Chadha (2010) and Trilochan Jane (2009) judgments by Hon’ble NCDRC.

 The Hon’ble Supreme Court in the latest land mark judgment of Om Prakash v. Reliance General Insurance IV (2017) CPJ 10 SC observed that in cases of theft, the concerned / affected person may not go straight away to the insurance company to claim compensation but would first make efforts to trace the vehicle and condition of immediate intimation should not bar settlements of genuine claims particularly when delay in intimation or submission of documents is due to unavoidable circumstances. The Hon’ble Supreme Court further observed that rejection of genuine claim specially those that have been verified and found to be correct by the surveyor / investigator on purely technical ground in a mechanical manner will result in loss of confidence of policy holders in insurance industry. The condition regarding the delay shall not be shelter to repudiate insurance claim which have been otherwise prove to be genuine. It needs no emphasis the Consumer Protection Act aims at providing better protection of the interest of the consumer and is a beneficial legislation deserving liberal construction. The Hon’ble Supreme Court thus held in the said case that the Hon’ble National Commission was not justified in rejecting the claim of appellant and set aside orders passed by Hon’ble NCDRC, SCDRC Haryana and District Forum Hisar. The said judgment has been consistently followed by the Hon’ble National Commission in subsequent judgment of Jagjit Singh v. Cholamandalam MS General Insurance Co. Ltd. IV (2017)  CPJ 446 (NC), Jaswinder Kaur v. ICICI Lombard Genearl Insurance Co Ltd. III(2018) CPJ 346 (NC), Ved Prakash Kajla v. New India Assurance Co. Ltd. III (2018) CPJ 567 (NC), Cholamandalam MS General Insurance Co Ltd v. Tanusree Mondal IV (2018) CPJ 260 (NC) and Shri Ram General Insurance Co Ltd v. Kuldeep IV (2018) CPJ 579 (NC) in which the Hon’ble National Commission relying upon, the judgment of Om Prakash passed by Hon’ble Apex Court held that mere delay in intimation of theft cannot be the “sole” ground for repudiation.

On the subject matter of repudiation of claim on ground of delay in intimation, The Hon’ble Supreme Court in SLP (civil) no 24370/2015 title Gurshinder Singh v. Shri Ram General Insurance Co Ltd. , vide order dated 09.01.2018 has referred the matter to a larger 3 judge bench to be constituted by Hon’ble Chief Justice of India.

In view of the exhaustive discussion / discourse on the proposition of law discussed thread bare on the basis of the judgments passed by Hon’ble Apex Court and Hon’ble National Commission and IRDA  guideline, we are of the consideration opinion after appreciating the documentary evidence on record that it is a genuine theft claim which was admittedly intimated by the complainant after a delay of 4 months from the date of theft to the OP since he was busy chasing the policy authorities in hope of recovering his stolen bike and finally on receiving the untraced report i.e. on losing all hope for recovery, knocked the doors of insurance company for process of theft claim, the factum of the insurance and theft not being disputed by insurance company is relevant to mention here. Therefore, in view of bench mark set in Amalendo Sahoo, Nitin Khandelwal and Om Prakash judgments (supra) of the Hon’ble Apex Court followed by the Hon’ble National Commission, we direct the OP to settle / process the theft claim of the complainant on non standards basis @ 75% of the IDV of Rs. 42,275/- which comes to i.e Rs. 31,706.25/- on submission of requisite documents by the complainant to OP. We further direct the OP to pay a sum of Rs. 5,000/- to the complainant as compensation for wrongful repudiation of claim in mechanical manner causing mental harassment and agony.

Let the order be complied with by OP within 30 days of receipt of copy of the same and complainant is directed to furnish the requisite document for the process of claim. 

7.  Let a copy of this order be sent to each party free of cost as per regulation 21 of the Consumer Protection Regulations, 2005.
8.   File be consigned to record room.
9.   Announced on  28.01.2019

 

(N.K. Sharma)      President

(Sonica Mehrotra)  Member