BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM; FATEHABAD.
C.C.No.309 of 2015.
Date of Instt.:23.11.2015.
Date of Order: 03.02.2017.
Anter Preet Singh son of Sheri Manjeet Singh resident of village Chander Kalan Tehsil Tohana District Fatehabad.
..Complainant.
Versus
1. The Oriental Insurance Company Limited Divisional Office Bhatinda, 4501 Bank Street, Bhatinda through its Divisional Manager.
2. The Oriental Insurance Company Limited Regd.& Head Office A-25/27, Asaf Ali Road, New Delhi-110002 through its Managing Director/Authorized signatory.
3. The Oriental Insurance Company Limited, Branch Office, Fatimabad District Fatehabad through its Branch Manager.
4. M/s Magma Fincorp limited SCO No.81-82. Urban Estate-2, Near Pushpa Complex, Delhi Road, Hisar through its Manager.
5. M/s Magma Fincorp Limited 24, Park Street, Calcutta through its Director/Authorized signatory.
6. M/s Raja Motors, GT Road, Fatimabad through its Manager/Director.
..Opposite parties.
Complaint under Section
12 of the Consumer Protection Act, 1986
Before: Sh.Raghbir Singh, President.
Smt.Ansuya Bishnoi. Member
Present: Sh.Rajiv Godara, counsel for the complainant.
Sh.N.D.Mittal, counsel for the OP Nos.1 to 3.
Sh.Dushyant Gera, counsel for the OP Nos.4 & 5.
Sh.Yogesh Gupta, counsel for the OP No.6.
ORDER
The complainant has filed the present complaint under Section 12 of the Consumer Protection Act, 1986 against the opposite parties (hereinafter to be referred as OPs).
2. Brief facts of the present complaint are that the complainant had purchased a car Hyundai I-20 bearing engine No.283641 chasis No.562723 having temporary registration No.HR99-PT-TEMP-1356 (now bearing registration No.HR22E-8897) from OP No.6. It has been further averred that the complainant got the car in question insured with OP No.1 vide policy No.233200/31/2014/2665 and the same was valid from 12.07.2014 to midnight of 11.07.2014. On 22.10.2013, the car of the complainant met with an accident with another car Maruti Swift Dezire bearing registration No.PB-30G-4377 and regarding this an FIR bearing No.216 dated 22.10.2013 had also been registered at P.S.Ding, District Sirsa. It has been further averred that in the accident the car got badly damaged and the same is lying with OP No.6. The complainant intimated the OP Nos.1 to 3 about the accident and thereafter surveyor of the company visited the spot who after inspecting the vehicle, in his report, has opined that the car in question has been totally damaged. It has been further averred that the complainant had completed all the formalities and also submitted all the relevant documents with the OP Nos. 1 to 3 which assured that the claim would be honoured very soon but to no avail. The vehicle in question was financed by OP Nos.4 & 5, therefore, the complainant had also informed them about the accident and sustaining of serious injuries by a person. It has been further averred that prior to accident, the complainant had paid 2-3 installments, therefore, the OP Nos. 4 & 5 cannot force him to make the payment but by taking the benefit of this, the OP Nos.4 & 5 have obtained false award against the complainant and have also filed an execution application for recovery. The complainant visited the OP Nos.1 to 3 many a times and requested for making payment of claim and he also visited the OP Nos. 4 & 5 and requested not to recover that amount forcefully besides serving of legal notice upon them but all fell on deaf ears, therefore, the complainant has got cause of action to file the present complaint against the OPs. Objections about maintainability, territorial jurisdiction of this Forum and maintainability have also been taken. In evidence, the complainant has tendered his affidavit Ex.CW1 and documents Annexure C1 to Annexure C5.
3. On notice, OPs appeared and contested the complaint by filing their separate replies. OP Nos. 1 to 3 in their joint reply have submitted that the accident had occurred on 22.10.2013 but the intimation regarding this was given to OP No.1 only on 04.12.2013 i.e. after a delay of more than 40 days and that too after lifting of vehicle from the spot but despite that the insurance company had appointed a surveyor who in its report has assessed the net payable amount as Rs.4,79,000/-. It has been further submitted that at the time of accident, the driver of the vehicle was under the influence of liquor at that time and the vehicle was also having temporary registration No.HR99-PT-Temp. 1356. The complainant himself has committed violation of the terms and conditions of the policy and lodging of FIR is of no avail unless due intimation of accident and FIR is given to insurance company. It has been further submitted that due to late intimation the insurance company cannot get the spot survey done in order to known exact cause and manner of accident as it was very important for settlement of the claim. Lastly prayer for dismissal of the complaint has been made.
4. OP Nos. 4 & 5 in their joint reply have submitted that at the time of purchasing of above said vehicle, the complainant had entered into an hire purchase agreement No.PG/0035/C/12/000285 dated 30.07.2013. The total financed amount alongwith interest charges was payable as Rs.6,40,080/- within 36 monthly installments commencing from 20.07.2013 and in this regard an award dated 06.04.2015 had already been passed by Arbitrator. It has been further averred that as per award an amount of Rs.4,98,408/- was outstanding against the complainant and in order to recover the said amount the OP Nos.4 & 5 have already filed an execution application and an amount of Rs.7,21,786/- was outstanding against the complainant upto 17.05.2016. Lastly, prayer for dismissal of the complaint has been made.
5. OP No.6 in its separate reply has submitted that the damaged vehicle was brought to its workshop and the same is lying in the workshop in damaged condition. It has been further submitted that Op no.6 is not liable for any damages and the insurance company is liable to indemnify the same. Objections about maintainability, cause of action and estoppel have also been taken and a prayer for dismissal of the complaint has been made.
6. The OPs in their evidence have tendered affidavit of Sh.Vikas Kala, Manager as Annexure R1, affidavit of Sushil Kumar, Divisional Manager Ex.R1 and documents Annexure R2 to Annexure R11.
7. Heard. The counsel for the complainant reiterated the averments made in the complaint and prayed for its acceptance whereas the counsel for OPs have reiterated the averments made in the replies and prayed for its dismissal.
8. It is not disputed that the vehicle in question was insured with the OP No.1 and the alleged accident had taken place during the subsistence of the policy as is evident from Annexure R8 i.e. copy of FIR and Annexure C2 i.e. copy of certificate of insurance. Learned counsel for the OP Nos. 1 to 3 has argued that this Forum has no territorial jurisdiction to decide the present case as the vehicle in question was insured with Bhatinda Branch and the accident had taken place within the territorial jurisdiction of Sirsa. In support of his arguments, he has placed reliance of case law titled as Sonic Surgical Vs. National Insurance Company Limited IV (2009) CPJ 40 (SC). It has been further argued by learned counsel for the OP Nos. 1 to 3 that the complainant himself had breached the terms and conditions of the policy as there is delay of more than 40 days in intimation to the insurance company about the accident. In support of his arguments he placed reliance of case law titled as Suresh Kumar Vs. National Insurance Company Limited (1) (2013) CPJ 60 (NC), Oriental Insurance Company Limited Vs. Balbir Singh II (2012) CPJ 38 and judgment dated 11.05.2015 passed by Hon’ble State Commission in FAP No.682 of 2014 in case titled as The Oriental Insurance Company Limited Vs. Sheri Gurmeet Singh.
9. After hearing learned counsels for the parties and going through the material available on the case file it is ample clear that the vehicle in question which was insured with Op No.1 had met with an accident and regarding this FIR No.216 dated 22.10.2013 at police station Ding District Sirsa. The plea taken by learned counsel for the OP Nos. 1 to 3 regarding territorial jurisdiction of this Forum is not tenable because Annexure C1 clearly shows that the vehicle of the complainant was insured at Fatehabad and regarding this cover note was issued by OP No.6 on dated 12.07.2013, though the policy was issued by OP No.1.
10. Now, we take another plea raised by the learned counsel for the OPs No.1 to 3 that there is delay in intimation of more than 40 days in informing the insurance company about the accident and the complainant has breached the terms and conditions of the policy, therefore, he is not entitled for any claim. This plea is also not sustainable in the eyes of law because the claim lodged by the complainant is regarding damage of his vehicle in an accident and the refusal of the claim by the insurance company on account of delay in intimation was totally unjustified and unfair because in the present case the delay cannot be termed as intentional as in the said accident the vehicle of the complainant has been badly damaged and even some persons have sustained grievous injuries, one person is in coma and one present died at the spot, therefore, it was not expected from the complainant to go to the insurance company straight away for lodging the claim. Moreover, no prejudice has been caused to the OPs on account of delay in intimation of the accident. The surveyor in his survey report in para No.8.3 has opined that taking into view the police report/FIR on record and the accidental prima facie available at final survey, the absence of spot have no adverse effect upon the assessment of loss. After the accident the complainant had to follow the due procedure of law as in the present case FIR was registered, therefore, rejection of the claim of the complainant on technical ground is not reasonable. There may be a condition in the policy regarding delay in intimation but that does not mean that the insurer can take the shelter under that condition and repudiate the claim of the claimant, which is otherwise proved to be genuine and therefore, it being a genuine claim of the complainant, cannot be denied in view of the judgment rendered by Hon’ble State Consumer Dispute Redressal Commission in First Appeal No.43 of 2014 titled ‘Shriram General Insurance Company Limited vs. Rajesh Kumar’ decided on March 10th, 2014, wherein the circular Ref: IRDA/HLTH/MISC/CIR/216/09/2011 dated 20.09.2011 issued by Insurance Regulatory & Development Authority pertaining to delay in claim intimation/documents, was taken into consideration and it was held that the insurance company cannot repudiate the bonafide claims on technical grounds like delay in information and non-submission of documents. The observation in this connection in Rajesh Kumar’s case (supra) is as under:-
“6. The solitary submission of the learned counsel for the appellant is that there was delay of 12 days in giving intimation to the appellant, which is in violation of the insurance policy. In support of the contention, reliance has been placed upon JAGDISH PARSHAD versus ICICI LOMBARD GENERAL INSURANCE CO. LTD. II(2013) CPJ 578 (NC).
7. This Commission does not concur with the submission of the learned counsel for the appellant. Indisputably, the F.I.R. was lodged with the Police without any delay and the respondent had informed the appellant-Insurance Company about the theft of his vehicle on December 21st, 2010, that is, after 12 days.
8. The circular dated September 20th, 2011 (Annexure-A) issued by ‘INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY’ is as under:-
“INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY
Ref. IRDA/HLTH/MISC/CIR/216/09/2011 Date: 20.09.2011
CIRCULAR
To: All life insurers and non-life insurers
Re: Delay in claim intimation/documents submission with respect to
i. All life insurance contracts and
ii. All Non-life individual and group insurance contracts
The Authority has been receiving several complaints that claims are being rejected on the ground of delayed submission of intimation and documents.
The current contractual obligation imposing the condition that the claims shall be intimated to the insurer with prescribed documents within a specified number of days is necessary for insurers for effecting various post claim activities like investigation, loss assessment, provisioning, claim settlement etc. However, this condition should not prevent settlement of genuine claims, particularly when there is delay in intimation or in submission of documents due to unavoidable circumstances.
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 insurers 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.
The insurers are advised to incorporate additional wordings in the policy documents, suitably enunciating insurers’ stand to condone delay on merit for delayed claims where the delay is proved to be for reasons beyond the control of the insured.
J.Harinarayan
CHAIRMAN”
9. It is very clear from the above circular that the insurance company cannot repudiate the bonafide claims on technical grounds like delay in intimation and submission of some required documents. The decision of insurers’ to reject a claim of the claimant should be based on sound logic and valid grounds. The 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 procedural grounds in a mechanical fashion will result in policy holders losing confidence in the insurance industry, giving rise to excessive litigation. It has been further advised in the above said letter that the insurers must not repudiate such claims unless and until the reasons of delay are specifically ascertained, recorded.
10. What is the spirit of Insurance Policy, should be kept in mind by the officials dealing with the genuine claims of the sufferers and the same should not be rejected on methodological grounds in a mechanical manner. The tendency of Insurance Companies in rejecting genuine claims is the reason of increasing litigation between the insurers and the insureds/their legal heirs.
11. In the instant case the vehicle was stolen on December 9th, 2010 and F.I.R. was lodged in the Police Station without any delay. Report of ‘Untraced’ submitted by the Police is the best piece of evidence to prove that the vehicle was stolen.
12. Thus, the repudiation of respondent’s claim was contrary to the letter Annexure-A, stated above because intimation to the insurance company after 12 days is not significant in genuine claim of the respondent-complainant. Under these circumstances, it was indeed a deficiency in service on the part of the appellant for repudiating respondent’s claim on flimsy ground. It would not be fair or reasonable to reject even the genuine claims of the insuree which had been verified and found to be correct by the Surveyor. In this view of the matter, the authority in Jagdish Parshad’s case (Supra) referred to by the learned counsel for the appellant is of no help to him.”
11. In the present case the OP Nos. 1 to 3 have miserably failed in their duties towards the insured and the pain and loss that the complainant has gone through is solely due to their negligent act. We feel that having created a shield for themselves in coining the lame excuse of delayed intimation also amounts to an unfair trade practice on the part of OP Nos. 1 to 3. It appears that after taking the huge premium for insuring the vehicle of the complainant, the OP NOs. 1 to 3 are denying to indemnify the claim lodged after accident, on one technical objection and the other. In generally, the insurance companies really chase people and literally promise everything at the time of selling policy but it is usual to see people struggle to run after Agents and Surveyors to get their rightful claims. Such agents then look other way and make insurers to make rounds to company offices. Insurers are then made to approach the Courts and are even dragged to this Court on one technical plea or the other. No one really is made to read the terms while making him to sign on the printed forms for selling policies. This attitude must change.” On this point reliance can be taken from case law titled as Sheri Ram General Insurance Company vs. Sarbjeet Kaur decided by Hon’ble Chandigarh State Commission on 22.12.2016 in Appeal no.336 of 2016. The case laws relied upon by learned counsel for the OP Nos. 1 to 3 are not applicable to the case in hand, therefore, these are being distinguished.
12. In view of the above discussion this Forum is of considered opinion that the OP No.s 1 to 3 insurance company have wrongly and illegally repudiated the claim of the complainant. Hence, present complaint is allowed and the complainant is entitled for the claim to the tune of Rs.4,79,000/- as assessed by the surveyor in Annexure R6 alongwith interest @ 9 % per annum from the date of filing of the complaint till realization of the amount. The OPs No.1 to 3 are further directed to pay Rs.10,000/- to the complainant as compensation on account of mental agony, harassment and litigation charges etc. Since, it is established on the case file that the vehicle in question was financed with OP Nos.4 & 5 and in order to effect the recovery of the loan amount an award to the tune of Rs. 4,98,408/- had already been passed against the complainant which led to initiation of execution application and even the OP Nos. 4 & 5 in their joint reply have submitted that an amount of Rs.7,21,786/- is outstanding against the complainant till 17.05.2016, therefore, the OP Nos. 1 to 3 are directed to release the amount of Rs.4,79,000/- as assessed by the surveyor in Annexure R6 alongwith interest @ 9 % per annum from the date of filing of the complaint till realization of the amount in favour of the OP Nos.4 & 5. Since the complainant has failed to prove any deficiency in service on the part of Op No.6, therefore, present complaint against it stands dismissed. Copy be supplied to the parties alongwith concerned bank free of costs. File be consigned after due compliance.
Announced: 03.02.2017 (Raghbir Singh)
President
District Consumer Disputes Redressal Forum, Fatehabad.
(Ansuya Bishnoi)
Member
