Haryana

Karnal

468/2011

Dharam Pal - Complainant(s)

Versus

Reliance General Insurance Company Limited - Opp.Party(s)

Subhash Chander

29 Jul 2016

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM KARNAL.

 

                                                                 Complaint No.468 of 2011

                                                               Date of instt. 04.08.2011

                                                               Date of decision: 29.07.2016

 

Dharam Pal resident of House no.670, new Prem Nagar, Karnal.

 

                                                                                       ………….Complainant.       

                                                         Versus

 

1. Reliance General Insurance Company, Branch Office at City Centre, 1^st Floor, opposite IB college, G.T. Road, Panipat.

2. Paranav Jawa son of Sham Sunder Dass SCO no.34 Sector 14, Main Market, Karnal (Authorized agent of addressee no.1) c/o Venus Properties, karnal.

3. Indusind Bank Ltd. Karnal.

                                       

                                                                                    ………..Opposite Parties.

 

                   Complaint u/s 12 of the Consumer Protection Act.          

 

Before                   Sh.K.C.Sharma……. President.

                   Sh. Anil Sharma……….Member.

                  

 

 Present       Shri Subhash Chander Advocate for complainant.

                   Shri Rohit Gupta Advocate for opposite party no.1.

                   Opposite party no.2 already exparte.

                   Sh. Vineet Rathore Advocate for opposite party no.3.

 

 

ORDER:                    

 

                        This complaint has been filed by the complainant under section 12 of the Consumer Protection Act, 1986, on the averments that he purchased one Ford Fiesta car bearing registration no.HR-05S-7447 by obtaining financial assistance from opposite party no.3.The said car was got insured from opposite party no.1, vide insurance policy no.2005792311010529, valid from 3.11.2009 to 2.11.2010, for insured value of Rs.5,50,000/-. The said car was stolen on 24.10.2010 from Rajouri Garden, New Delhi area and First Information Report bearing no.384 dated 4.12.2010 was registered in Police Station Rajouri Garden, regarding the said theft. Immediately after the theft, claim was lodged with the opposite party no.1. Official of opposite party no.1 got signed some documents from him and all other formalities were completed. He was assured that the insurance benefit would be given to him within two months, but his claim was repudiated illegally on the ground of delay of two months in lodging the claim with the opposite party no.1 and delay in lodging the First Information Report, whereas he had intimated the opposite party no.1 and the police immediately after the theft. Police told him that firstly they would try to trace out the vehicle and if the same would not be traced out, then First Information Report would be lodged. Thus, there was no intentional delay in lodging the First Information Report and lodging the claim with the opposite party no.1. Repudiation of claim by opposite party no.1 on such illegal grounds amounted to deficiency in service and unfair trade practice, due to which he suffered mental pain, agony and harassment, apart from financial loss.

2.                Notice of the complaint was given to the opposite parties. Opposite party no.1 filed written statement controverting the claim of the complainant. Objections have been raised that the complainant has no locus standi and cause of action to file the complaint; that this forum has got no territorial jurisdiction to entertain and adjudicate the complaint; that the complaint is bad for non-joinder of necessary parties and that the complicated questions of law and facts are involved which cannot be adjudicated by this Forum under summary jurisdiction.

                   On merits, it has been submitted that the alleged theft had taken place on 24.10.2010, but the First Information Report was lodged after 40 days of theft. The complainant managed Daily Diary Report no.35A in Police Station Rajouri Garden in collusion with the official of the Police Station with the help of his son Shiv Kumar, who was employed as Sub-Inspector in Delhi Police. It has further been pleaded that intimation was given to opposite party no.1 after delay of nearly two months i.e. on 20.12.2010. The opposite party no.1 was thus deprived off the immediate opportunity to check and investigate the circumstances of the alleged theft. Moreover, second key of the vehicle was kept in the tool box, which could also be reason for the theft. The vehicle was allegedly left unattended in open area near a busy road side despite the availability of paid parking near that place and that fact also contributed to the theft. In this way, complainant violated the conditions no.1 and 4 of the policy, therefore, his claim was rightly repudiated and there was no deficiency in service on the part of the opposite party no.1. The other allegations made in the complaint have been specifically denied.

3.                Opposite party no.2 also filed written statement raising objections regarding locus standi and estoppel only.

                   On merits, it was submitted that the contents of relevant paras of the complaint were matter of record. However, when the case was at the stage of evidence of the opposite parties, none put into appearance on behalf of the opposite party no.2, therefore, exparte proceedings were initiated.

4.                Opposite party no.3 filed separate written statement. It has been alleged that the complainant got financed the vehicle in question from opposite party no.3 and duly entered into loan agreement no.HK001965H, but he did not pay installments as agreed. The matter was referred to Arbitrator, who passed well speaking award dated 23.2.2012, according to which the complainant was directed to pay Rs.1,16,545/- together with further interest @ 18% per annum calculated from 19.10.2011, till the date of payment. If, the claim of the complainant is allowed, then the same is liable to credited in appropriating the decretal amount outstanding against the complainant.

5.                In evidence of the complainant, his affidavit Ex. C1 and documents Ex.C2 to C7 have been tendered.

6.                On the other hand, in evidence of the opposite party no.1, affidavit  of Abhilash Chander Assistant manager Ex.O1 and documents Ex.O2 to Ex.O7 have been tendered.

7.                Opposite party no.3 tendered into evidence, affidavit of Nitin Chawla Ex.OW3/A and documents Ex.OW3/B to Ex.OW3/E.

8.                We have appraised the evidence on record, the material circumstances of the case and the arguments advanced by the learned counsel for the parties.

9.                There is no dispute about the fact that the vehicle of the complainant bearing no. HR-05S-7447  was insured with the opposite party no.1 for the period of  3.11.2009 to 2.11.2010. As per the case of the complainant  the said vehicle was stolen on 24.10.2010 from the area of Rajouri Garden, New Delhi and intimation of the theft was immediately given to the police as well as to opposite party no.1. The vehicle could not be traced out, therefore, claim was lodged with the opposite party no.1, but the same was repudiated illegally.

10.              Learned counsel for the opposite party no.1 contended that the complainant gave in writing on 25.12.2010 while giving intimation of theft to opposite party no.1 that one key of the vehicle was with him, whereas the other key was in the tool box and the said writing is Ex.O3. Moreover, the vehicle was left unattended despite availability of the parking place nearby. Thus, the complainant had not taken reasonable safeguard of the vehicle from the loss which contributed to the theft of the vehicle and in this way he violated the condition no.4 of the policy, therefore, his claim was rightly repudiated on this ground.

11.              No doubt in the letter of the complainant, the copy of which is Ex.O3, it was mentioned that one key of the vehicle was in the tool kit, but on the basis of such fact it cannot be said by any stretch of imagination that leaving one key in the tool kit contributed to the theft of the vehicle, because the vehicle was a car and tool kit of the same is generally kept in the dickey or the dash board and no one can take the key in such a situation from the tool kit without opening the lock of the car. Had the tool box/tool kit been attached with the body of the vehicle just like in tractor then certainly it could be said that there was negligence on the part of the owner of the tractor by leaving the ignition key in tool box. Therefore, the argument of learned counsel for opposite party no.1 in this regard cannot be accepted being devoid of force.

12.              The vehicle of the complainant was stolen from the area of Rajouri Garden, New Delhi. Photographs of the location produced by the opposite party no.1 as Ex.O5 indicate that the vehicle was parked along roadside. There is no evidence on record, which may show that there was any other authorized parking place in that area near that place. Generally, the vehicles are parked everywhere along roadside near markets and other places where there is no authorized place of parking. The only safety which an owner of the vehicle can take is that he should lock the vehicle properly. Neither it has been alleged nor there is any evidence that the vehicle was not locked by the complainant properly after parking the same on the roadside. Therefore, under such circumstances, it cannot be said in any manner that complainant had not taken any safety measurement for parking the vehicle and there was negligence on his part.

13.              Learned counsel for the opposite party no.1 further put a great thrust upon the contention that the theft of the vehicle had taken place on 24.10.2010, whereas First Information Report was lodged on 4.12.2010. The insurance policy lapsed on 2.11.2010. The complainant managed Daily Diary Report no.35A dated 24.10.2010 in collusion with official of Police Station Rajouri Garden, New Delhi with the help of his son, who was posted as Sub Inspector in Delhi Police. It appears that the theft might have taken place after lapse of the policy, but in order to cover the same during policy period the complainant managed the said Daily Diary Report. It has further been vehemently argued that the intimation of the theft was given to opposite party no.1 on 20.12.2010 i.e. after a delay of about two months, whereas according to the policy condition intimation was required to be given immediately after theft and in this way the complainant violated policy condition no.1 and his claim was legally repudiated on such ground.

14.              To wriggle out the aforesaid contention learned counsel for the complainant contended that the local police as well as opposite party no.1 were informed about the theft immediately. Local police entered Daily Diary Report no.35 regarding the said theft, but when the vehicle could not be traced, First Information Report was registered on 4.12.2010. Thereafter, all the relevant documents were submitted to the opposite party no.1, but the opposite party no.1 illegally repudiated the claim.

15.              Theft claim lodged by the complainant was got investigated by opposite party no.1 as is evident from the fact that photographs, the copy of which is Ex.O5, of the location of theft were taken by the investigator. However, opposite party no.1 has not produced the copy of the report of investigator for the reasons best known to it. The opposite party no.1 has led no evidence worth the name on the record from which even an inference may be drawn that the theft of the vehicle of the complainant was not genuine.

16.               Insurance Regulatory and Development Authority issued circular dated 20.9.2011, which is reproduced as under:-

“ 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 merits fort delayed claims where the delay is proved to be for reasons beyond the control of the insured.

          J.Harinarayan

          CHAIRMAN.”

 

17.              It is clear from the above circular that insurance company cannot repudiate the theft claim on technical grounds like delay in intimation and submission of some required documents. The decision of insurer to reject a claim of the claimant should be based on sound logic and valid reasons. 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 technical grounds in a mechanical fashion will result in policy holder losing confidence in the insurance industry, giving rise to excessive litigation. It has further been advised in the said letter that the insurer must not repudiate such claims unless and until the reasons for delay are specifically ascertained, recorded.

             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. In this context reference with advantage may be made to orders of the Hon’ble State commission in  Shriram General insurance Company limited Versus Rajesh Kumar 2014(2) CLT 290 and Shriram General Insurance Company Limited Vs. Manoj 2014(3) CLT 447 as well as order of Hon’ble National Commission in National Insurance Co.Ltd. Versus Kulwant Singh IV (2014) CPJ 62 (NC).

18.              In the instant case, the vehicle of the complainant was stolen on 24.10.2010. The complainant has alleged that the matter was immediately reported to the Police and intimation was also sent to opposite party no.1.The copy of the Daily Diary Report no.35 has been placed on the record by the complainant, which indicates that the matter regarding the theft was immediately reported by the complainant to the Police. In the complaint it has been submitted that the police told him that the police would try to trace out the vehicle and if the same would not be traced out, then First Information Report would be lodged. The First Information Report was registered on 4.12.2010. It is a matter of common knowledge that the police does not register the First Information Report immediately after getting information of theft of any vehicle, generally, either the complainant is asked to trace out the vehicle at his own level or efforts are made by the police for searching the vehicle, but when the vehicle is not traced out, then only the First Information Report is registered. Such course is adopted by the police only to keep in check the number of reported cases of theft. The opposite party no.1 could not lead any evidence in order to substantiate the plea that the complainant had managed Daily Diary Report no.35 dated 24.10.2010 in collusion with the police official of Police Station Rajouri Garden with the help of his son Shiv Kumar who was employed in Delhi Police. Mere allegation cannot take the place of proof. In the absence of any proof the said plea raised by the opposite party no.1, cannot be accepted. Under such a situation, it cannot be said that there was any delay on the part of the complainant in reporting the matter to the police. It is not the case of the opposite party no.1 that theft of the vehicle of the complainant was not found to be genuine. The vehicle could not be traced out by the police. Generally, intimation is given by an insured to his agent or officials of the insurance company on telephone and record of such intimation is not maintained. Even if, it is a correct intimation was given by the complainant to opposite party no.1 for the first time on 20.12.2010, then also repudiating of his claim on such ground was contrary to the spirit of the letter of Insurance Regulatory and Development Authority, because intimation to the insurance company after delay of two months was not significant in genuine claim of the complainant. A person, who lost his vehicle straightway, may not go to the insurance company to claim compensation. At the first instance, he himself makes efforts to search the vehicle. Filing of the claim with the insurance company is the last resort. In view of such facts and circumstances, we have no hesitation in observing that the repudiation of the genuine claim of the complainant on the grounds of delay in intimation to opposite party no.1 regarding theft and violation of condition no.4 of the policy regarding safety of the vehicle, amounted to deficiency in service on the part of the opposite party no.1. Therefore, the complainant is entitled to get compensation.

19.              Admittedly, the vehicle of the complainant was financed by opposite party no.3 and he had not paid the installments of loan regularly. Under para no.6 of the complaint it has been submitted that the insured amount is to be credited in the loan account maintained by opposite party no.3.  

20.              As a sequel to the foregoing discussion, we accept the present complaint and direct the opposite party no.1 to credit the insured amount alongwith interest @ 9% per annum from the date of filing the complaint till its realization in the loan account of the complainant with the opposite party no.3 and opposite party no.3 is directed to adjust the awarded amount in his loan account if any outstanding against him. We further direct the opposite party no.1 to pay Rs.5500/- to the complainant on account of mental agony and harassment suffered by him and for the litigation expenses. This order shall be complied within 30 days from the receipt of copy of this order. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Announced

Dated: 29.07.2016

                                                                                      (K.C.Sharma)

                                                                                         President,

                                                                             District Consumer Disputes

                                                                             Redressal Forum, Karnal.

                             (Anil Sharma)

                               Member