Undisputedly, motorcycle bearing registration No.HR-21C/8748 of complainant Robin Agarwal was duly insured with Shri Ram General Insurance Company i.e. with the opposite party, for the period from 16.11.2011 to 15.11.2012 for insured sum of Rs.25,200/-. During the period of insurance, on 27.6.2012, at about 1.30 p.m. Hitesh Agarwal, real brother of the complainant, parked it outside Killa Gate, Hansi , after locking it. He had gone in the market for some domestic work; but when he returned, he found the motorcycle missing. At that time the complainant was out of station. Missing of the motorcycle was reported to the police when FIR No.376 dated 28.6.2012 was registered in Police Station, Hansi under Section 379 of IPC. It was registered at 4.25 p.m. Further undisputedly complainant reported the theft of the motorcycle to the opposite party on telephone on dated 4.7.2012. He also lodged his claim under the insurance policy but it was repudiated vide letter dated 17.7.2012(Annexure C-7) on the ground of breach of terms and conditions No.1& 4 of the Insurance policy i.e. delay of about 8- 9 days informing the insurance company for the theft and leaving the motorcycle un attended when it was stolen. Averring the repudiation of the claim as unjustified and deficiency of service on the part of the opposite party, complainant has filed this complaint for a direction to the opposite party, for payment of insured amount of Rs.25,200/-, with up to date interest, besides compensation for his harassment, humiliation, mental agony etc. and litigation expenses.
2. Opposite party in its reply, has pleaded for the legality and validity of the repudiation of the claim of the complainant on the grounds of delay of 8-9 days in informing the theft to the Insurance company and leaving the motorcycle unattended when it was stolen.
3. Both the parties to the complaint have placed on record copies of various documents and their respective supporting affidavits. Details thereof need not be noted as these are to prove above undisputed facts. Annexure R-1 and Annexure R-2 are the copies of letters of the opposite party, written to complainant on 17.7.2012 and 19.9.2012 respectively, mentioning the intimation of theft to them on 5.7.2012. Annexure R-3 to Annexure R-6 are the copies of various letters of the complainant written to different authorities, mentioning for his telephonic information dated 4.7.2012, given to the opposite party for the theft of his motorcycle. Therefore admittedly there is delay of about 8-9 days, in reporting the theft to the insurance company; whereas there is no delay in reporting the theft to the police, as bare perusal of FIR shows that theft of the motorcycle is dated 27.6.2012 of 8.30 p.m. and FIR was lodged on the next day dated 28.6.2012 at 4.25 p.m. i.e. within 24 hours of the theft. Information of the theft was given to the police by Hitesh Agarwal, brother of the complainant, as at the time of theft complainant was out of station.
4. Perusal of FIR also shows that motorcycle was stolen, when it was parked, outside Killa gate in Kila Bazar,Hansi and at that time it was locked. At that time Hitesh Agarwal, brother of the complainant, had gone in the market for some domestic work, but when he came back, he found the motorcycle missing. Undisputedly Killa Bazar, Hansi is a very busy locality. Further undisputedly the police after due investigations had submitted untrace report, which was accepted by the Illaqa Magistrate.
5. To justify the repudiation of the claim of the complainant, ld. Counsel for the opposite party, has contended that since there is delay of about 8-9 days in reporting the theft to the Insurance Company, so there is violation of term and condition No.1 of the Insurance policy. It is also contended that since the motorcycle was left unattended, so there is also violation of term and condition No.4 of the insurance policy. On these grounds, it is contended that repudiation of the claim of the complainant, is legal, valid and justified. We have considered the contention, but in view of facts and circumstances of the case in hand, we do not find any merit in the contention of ld. Counsel of the opposite party. In our considered opinion when there was immediate information of the theft to the police; then delay of about 8-9 days, in reporting the theft to the Insurance company, is not at all fatal. Condition No.1 of the Insurance Policy, violation of which is alleged by the opposite party, read as under:-
“Notice shall be given in writing to the Company immediately upon the occurrence of any accidental loss or damage and in the event of any claim and thereafter the insured shall give all such information and assistance as the company shall require. Every letter claim writ summons and/or process or copy thereof shall be forwarded to the Company immediately on receipt by the insured. Notice shall also be given in writing to the Company immediately the insured shall have knowledge of any impending prosecution, inquest or fatal inquiry in respect of any occurrence which may give rise to a claim under this policy. In case of theft or criminal act which may be the subject of a claim under this policy the insured shall give immediate notice to the police and co-operate with the company in securing the conviction of the offender” (Emphasis supplied).
6. From the above condition, it is clear that in case of any accidental loss or damage, the insured shall give information immediately in writing to the insurance company. The notice is mandatory in writing to the company immediately and the insured shall have knowledge of any impending prosecution Inquest of Fatal Inquiry in respect of any occurrence which may give rise to a claim under this policy. This part of the condition is applicable to the occurrence of any accidental loss or damage or impending prosecution Inquest or Fatal Inquiry of any occurrence which may give rise to any claim under the policy.
7. But so far as the cases of theft are concerned, as per the above condition, in case of theft or a criminal act, which may be the subject matter of the claim under the policy, it is mandatory for the insured to give immediate notice to the police and cooperate with the company in securing the conviction of the offender. Thus, the second part of this condition deals with the cases of theft or any criminal act from which the claim may rise and in that case, the information has to be given to the police and the insured has to cooperate in securing the conviction of the offender.
8. In the present case theft took place on 27.6.2012 FIR regarding the theft was registered within 24 hours. Therefore mandatory requirement of informing the police immediately was fully complied with Now it was for the police to investigate, arrest the offender and to recover the stolen motorcycle etc. In the present case, police duly discharged it duties and ultimately submitted untrace report which was accepted by the Illaqa Magistrate. In this regard duty of the complainant, was only to co-operate with the insurance company to secure conviction of the offender. There is nothing to prove or to presume that the complainant did not co-operate with the Insurance Company. Since it was untrace case, so there was no question even for giving any cooperation by the complainant, to secure conviction of the offender.
9. The distinction between cases of accidental loss and cases of theft had been made because in case of accidental loss, the insurance company has to immediately get the spot survey conducted to know the actual loss at the spot itself and thereafter, the final survey is conducted, so that no manipulation is done in replacing the parts which might have been damaged in the accident. Support in this regard if any can be sought from Shri Ram General Insurance Company Limited & Another Versus Gurshinder Singh & another,2013(3)CPC,593. This ruling is fully applicable to the facts of the case in hand.
10. However, ld. Counsel for the opposite party has, cited Budha Ganesh Versus New India Insurance Company Ltd.2014(1)CPC,402; Suman Versus Oriental Insurance Company Ltd.2013(2)CPC,123; Ramesh Chandra Versus ICICI Lombard General Insurance Co.Ltd. and another,2014(1)CPC,335 and Dinesh Kumar Parik Versus United India Insurance Co.Ltd. 2013(2)CPC,320. We have gone through all these citations but find that the same have no bearing, on the facts of the case in hand. In all these cases, there was undue and unreasonable delay to report the theft to the police and so repudiation was held justified. But here in the case in hand, there was no delay to report the theft to the police, rather it was immediate and prompt.
11. However, there is no dispute with the proposition of law, as is held in National Insurance Co.Ltd. Versus Laxmi Narain Dhut,III(2007)CPJ,13 and Deokar Exports Pvt. Ltd. versus New India Assurance Company Ltd.1(2009) CPJ,6 cited by ld. Counsel for the opposite party, that terms and conditions of insurance policy have to be constructed as it is, and there is no scope for adding or subtracting something, therefrom. As above discussed and found, while construing term and condition No.1 of the Insurance Policy, it is very clear that the genuine claim of the complainant , could not be repudiated simply on the ground of delay in informing the theft to the insurance company, when police was immediately informed.
12. Ld. Counsel for the complainant has also rightly sought support from the ruling of Hon’ble Apex Court, in B.V.Nagaraju Versus Oriental Insurance Co.Ltd.,I(1997)ACC 123, relying upon earlier judgment ‘S.Kandia Insurance Company Ltd. Versus Kokila Ben Chandrabadan and others,1(1987) ACC 413 (SC)=AIR 1987 SC 1184. It has held that Consumer Protection Act, is a beneficial Act and only on hyper technical ground, if the claim is otherwise genuine, should not be repudiated.
13. Matter can also be looked into from another point of view In New India Assurance company Ltd. Versus Trilochan Jane, F.A. No. 321 of 2005 decided on 9.12.2009, it is held that “immediately” has to be constructed “Within a reasonable time having due regard to the nature and circumstances of the case.” Here in case in hand, theft had taken place on 27.6.2012, when FIR was lodged within 24 hours the police, could not trace out the culprit and later on after due investigation, submitted untraced report, which was accepted by Illaqa Magistrate. In the circumstances it cannot be said that late information of the theft, to the insurance company, if any could prejudice the case of the opposite party.
14. In law, as well, denial of genuine claim, on hyper technical ground is not permissible. For it the opposite party, has to show that the delay, if any, has prejudiced its case. But here in the case in hand, as above discussed and found, delay if any has not prejudiced the case of the opposite party.
15. Moreover, opposite party is bound by its own official circular dated Sep.20th 2011, issued by Insurance Regulatory And Development Authority, which read as under:-
“INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY
Ref. IRDA/HLTH/MISC/CIR/216/09/2011
CIRCULAR
o: All life insurers and non-life insurers
e: 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, suitable 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”
16. 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.
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.
17. Therefore filing genuine claim of the complainant on the pretext of delay is certainly deficiency of service on the part of the opposite party.
18. In Ramesh Chandra Versus ICICI Lombard General Insurance Co.Ltd and another(supra) the truck was stolen, when its driver had gone to the fields, to attend the call of nature. The truck was left unattended on the highway. In those circumstances it was held that the truck was left unattended. But here in the case in hand, the motorcycle was left outside killa gate, in killa Bazar, Hansi after properly locking it. It was thus not left unattended, which could facilitate the commission of theft.
19. For the forgoing reasons, it is very clear that repudiation of the claim of the complainant is totally unjustified and it is deficiency of service on the part of the opposite party.
20. Resultantly, this complaint is hereby allowed, with a direction to the opposite party to pay insured amount of Rs.25,200/- to the complainant with interest @ 9% per annum from the date of theft i.e. 27.6.2012, till payment. Complainant is also hereby awarded compensation of Rs.8,000/- for his harassment, mental tension etc. and litigation expenses of Rs.2200/- against the opposite party
Announced.
Dated:08.05.2015.
