Haryana

Karnal

521/2012

Bhim Singh S/o Sawrup Singh - Complainant(s)

Versus

Shriram General Insurance Company - Opp.Party(s)

Rajesh Gulia

07 Oct 2016

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM KARNAL.

                                                              Complaint No.521 of 2012

                                                             Date of instt.: 26.10.2012

                                                                Date of decision:07.10.2016

 

Bhim Singh son of Shri Sawrup Singh resident of VPO Didwari, Tehsil Israna, District Panipat.

 

                                                                   ……..Complainant.

                                      Vs.

1. Shriram General Insurance Co. Ltd. branch office at Jai Mata Market, near Malik Hospital, Gohana Road, Panipat through its Agent Shri Sumit Malik.

2. Shriram General Insurance Co. Ltd., branch office S.C.O. 410, Mugal Canal, Karnal.

                                                                          ………… Opposite Parties.

                     Complaint u/s 12  of the Consumer Protection Act.

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

                   Sh.Anil Sharma…….Member.

 

Present:-      Sh. Rajesh Gulia Advocate for the complainant.

                    Sh. Narinder Kumar Advocate for the Opposite parties.

                  

 ORDER:

 

                        This complaint has been filed by the complainant u/s 12 of the Consumer protection Act 1986, on the averments that he got insured his Hero Honda Splendor plus  Motorcycle bearing registration no.HR-06S-2281, engine no.10326 and chasis no.06643 Model 2011 with the opposite parties, vide policy no.102018/31/12/001885 valid from 23.05.2011 to 22.05.2012. On 07.11.2011 at about 8.00 p.m. his son namely Virender had gone to TDI Mall, P.S.Tajganj, Agra (UP) for shopping and he parked the motorcycle after locking the same, but unfortunately the  motorcycle was stolen by some unknown person. His son tried to his best to search the motorcycle, but all in vain. Then his son informed the concerned police station regarding theft of the motorcycle. First Information Report no.750 dated 8.11.2011 was registered in Police Station Tajganj Agra regarding the said theft. Information was also given to the opposite parties about the theft of the motorcycle. He lodged claim with the opposite parties, but the opposite parties repudiated his claim, vide letter dated 07.01.2012 on the ground of delayed intimation to the opposite parties. There was no delay on his part in giving information to the police as well as the opposite parties, but his claim was illegally repudiated. In this way, there was deficiency in service and unfair trade practice on the part of the opposite parties, which caused him mental pain, agony and harassment apart from financial loss.

2.                Notice of the complaint was given to the opposite parties, who appeared and filed written statement disputing the claim of the complainant. Objections have been raised that the complainant has suppressed the material facts from this Forum; that the complaint is a false, frivolous and vexatious; that the complainant has violated the terms and conditions of the insurance policy and that the complaint is bad for mis-joinder and non-joinder of necessary parties.

                   On merits, it has been submitted that the complainant had parked his motorcycle on unsafe place. As per statement given to the investigator, he admitted that the vehicle was parked outside the TDI Mall Agra whereas there was authorized parking within the Mall. It clearly shows that the vehicle in question was left unattended.  Moreover, he lodged First Information Report after one day i.e. on 8.11.2011 and informed the opposite parties regarding theft of the motorcycle after lapse of 4 days on 11.11.2011. Thus, the investigation could not be effected immediately and the complainant wasted valuable time of the investigator, which amounted to violation of terms and conditions of the insurance policy. It has further been pleaded that complainant failed to deposit the set of keys of the vehicle in question with the insurer, which is also violation of terms and conditions of the policy. Therefore, the opposite parties are not liable to pay any compensation to him and the claim was rightly repudiated.

3.                In evidence of the complainant, his affidavit EX.CW1/A and documents Ex.C1 to C4 have been tendered.

4.                On the other hand, in evidence of the opposite parties, affidavit of Rajendra Sharma  Ex.OP1/A and documents Ex.OP2 to OP7 have been tendered.

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

6.                The motorcycle of complainant bearing registration no. HR-06S-2281 was insured with the opposite parties and the same was stolen during subsistence of the insurance policy on 7.11.2011. First Information Report regarding theft was lodged with Police Station Tajganj Agra(UP) on 8.11.2011. Claim was lodged with the opposite parties on 8.11.2011, but the opposite parties repudiated the claim vide letter dated 07.01.2012, the copy of which is Ex.OP3 on the ground that the motorcycle was stolen on 7.11.2011 and intimation to the opposite parties was given after 4 days on 11.11.2011 which amounted to violation of the terms and condition no.1 of the policy.

7.                Learned counsel for the opposite parties put a great thrust upon the contention that the theft of the motorcycle had taken place on 7.11.2011, but the First Information Report was lodged on 8.11.2011 and the intimation was given to the opposite parties on 11.11.2011 i.e. after delay of 4 days, which was violation of the terms and conditions of the insurance policy, therefore, the opposite party is not liable to pay any compensation to the complainant.

8.                To wriggle out the aforesaid contention, learned counsel for the complainant vehemently argued that the complainant initially tried to search the motorcycle at his own level and when the same could not be traced out the matter was reported to the police immediately.  Thereafter, intimation was given to the opposite parties. Thus, there was no unreasonable delay on the part of the complainant, but the opposite parties refused to settle his claim on false ground of delay of 4 days in intimation.

9.                 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.”

 

10.              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) .

11.              In the instant case, the vehicle of the complainant was stolen on 7.11.2011. The First Information Report was lodged on 8.11.2011. Generally, the owner/Driver of the vehicle first tries to search the vehicle at his own level, but when he fails to trace out the same, the matter is reported to the police. It is also a matter of common knowledge that the police does not register the First Information Report immediately after getting information of theft of any vehicle, 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. Moreover, there is reference in the report of Surveyor that initially the son of the complainant called on 100 number PCR and message of theft was conveyed through wireless. Therefore, it cannot be said that there was any unreasonable delay on the part of the complainant in lodging the First Information Report. It is not the case of the opposite parties that the motorcycle of the complainant was not stolen and the story of theft putforth in the First Information Report was false. Thus, the claim of the complainant regarding theft of the motorcycle was genuine and never disputed by the opposite parties. Under such circumstances, the repudiation of the claim of the complainant by the opposite parties was contrary to the spirit of the letter of Insurance Regulatory and Development Authority, because intimation to the opposite parties after 4 days of theft 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. Therefore, repudiation of the genuine claim of the complainant on the sole ground of delay in intimation amounted to deficiency in service on the part of the opposite party.

13.              As a sequel to the foregoing discussion, we accept the present complaint and direct the opposite party to pay Rs.39,800/- as insured amount to the complainant  alongwith interest thereon @ 9% per annum from the date of filing of complaint till its realization. We further direct the opposite party 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: 07.10.2016

                                                                                      (K.C.Sharma)

                                                                                         President,

                                                                             District Consumer Disputes

                                                                             Redressal Forum, Karnal.

                             (Anil Sharma)

                               Member