The complainant Tarlok Bandhu (here-in-after referred to as complainant) has filed this complaint U/s 12 of Consumer Protection Act, 1986 (Now C.P. Act, 2019, here-in after referred to as 'Act') before this Forum (Now Commission) against United India Insurance Co. Ltd., and another (here-in-after referred to as opposite parties).
Briefly stated, the case of the complainant is that he is the owner of Royal Enfield Motorcycle bearing registration No. PB-03AJ-2442 Model 12/2014. The said vehicle was comprehensively insured with opposite party No. 1 vide Insurance Certificate No. 2004013116P10541189 for the period from 25.07.2018 to 24.07.2019 for the IDV of Rs. 80,000/-. The opposite party No.1 never supplied any policy to the complainant till date.
It is alleged that the said motorcycle of the complainant was stolen by some unknown person on 31.03.2019 form Satya Niketan, Delhi. Appar Bandhu, son of the complainant, immediately intimated the police of Police Station (South Campus, South West) Crime Branch, Delhi and lodged FIR No. 011404 dated 31.03.2019 under Section 379 IPC. The complainant gave intimation about the theft of his said motorcycle through opposite party No.2 Mr. Krishan Kapoor agent of the opposite party No.1 on 02.04.2019 who further intimated to opposite party No.1 immediately.
The complainant alleged that the opposite party No.1 demanded various documents, report including untraceable report and the complainant fulfilled all the formalities. Further the police of P.S.M.V. Theft also submitted untraced report of the Hon' ble Court of Gurmohina Kaur, Ld. A.C.M.M, Delhi and the Hon' ble Court passed order dated 17.07.2019 and the complainant also submitted the copy of above said order to opposite party No.l.
It is alleged that opposite party No.1 got done the complete survey and also took the signatures of the complainant on blank papers, forms, vouchers and consent letter with the understanding that the total loss will be paid to the complainant at the earliest. The surveyor of the opposite party No.1 also took keys of the motorcycle as well as duplicate R.C. from the complainant, but no receipt was issued about receipt of said documents and keys. The complainant also submitted necessary documents i.e. photocopy of Insurance Cover Note, Registration Certificate of the vehicle to the opposite party No.1 through surveyor.
It is also alleged that the complainant used to visit opposite party No. 1 and inquire about his claim for the loss suffered by him but no satisfactory reply was given by opposite party. Thereafter, the complainant received a letter dated 31.10.2019 vide which the opposite party No. 1 repudiated the claim of the complainant on the ground that claim is not maintainable due to breach of policy terms & conditions i.e. Condition No. 1 (Delay in intimation).
The complainant alleged that the said repudiation letter is totally illegal, null, void, against principles of natural and also against the rules of IRDA and is not binding effect on the rights of the complainant as the complainant lodged the FIR immediately after the incident and the also gave information to opposite party No. 1 through opposite party No. 2 i.e. its agent Krishan Kapoor. Due to non-payment of the claim by the opposite party, the complainant has suffered mental agony, pains as well as heavy damages on account of interest loss, for which he claims compensation to the tune of Rs.20,000/-.
On this backdrop of facts, the complainant has prayed for directions to the opposite parties to pay Rs. 80,800/- with interest @ 18% p.a. alonwith compensation to the tune of Rs. 20,000/- in addition to Rs. 11,000/- as litigation expenses.
Registered Notice of complaint was sent to the opposite parties. None appeared on behalf of opposite party No. 2. As such, exparte proceedings were taken against opposite party No. 2.
The opposite party No. 1 put an appearance through counsel and contested the complaint by filing written reply raising legal objections that the complaint is not maintainable in the present form. That Commission has no jurisdiction to try & entertain this complaint. That complainant has concealed true and material facts from this Commission and has not approached with clean hands. That complainant has alleged that his signatures were obtained on blank papers by surveyor of opposite party No.1, meaning thereby complainant is making allegations of forgery & fraud, which is not within jurisdiction of this Commission, hence on this score alone, the complainant is liable to be relegated to seek his legal redress, if any, from the competent court of law. That complicated questions of law and facts are involved, for adjudication which is not possible as proceedings before this Commission, are of summary nature.
It has been pleaded that the complainant has knowingly, wilfully, violated the terms and conditions of insurance policy, which were binding on both the parties i.e. condition No.1. As per said condition, the complainant was bound to intimate opposite party No.1 immediately regarding alleged theft of vehicle, which as per complainant took place on 31.03.2019, but intimation of the same for the first time was given by the complainant to opposite party No. 1 on 13.08.2019 i.e. after 135 days of the alleged theft, for the reasons best known to him. Hence it is clear cut intentional violation of the mandatory condition No. 1 of insurance policy of the vehicle. As such, the claim has been rightly and legally repudiated by opposite party No.1 and there is no deficiency of service on the part of opposite party No. 1.
It has been further pleaded that the complainant has manoeuvred impugned letter from Krishan Kapoor, agent alleging intimation, but Krishan Kapoor was not competent authority to be intimated regarding the alleged theft. As per policy, office of company was required to be intimated. Even the impugned letter of Krishan Kapoor finds mention that he had asked the complainant to bring non-traceable certificate from Delhi Police, but it does not find mention that he had asked the complainant to not to intimate about the theft of vehicle. The alleged non-traceable letter was issued on 17.07.2019, but even then the intimation of alleged loss was given on 13.08.2019 i.e. after 27 days delay from the date of issuance of alleged non-traceable certificate of Delhi Police. Thus it becomes crystal clear that there is blatant and un-explained delay in intimating the opposite party instead of giving immediate information, to enable the opposite party No.1 to do the needful at the rightful juncture, to minimize the loss and get searched the vehicle in question. Thus the competent authorities of opposite party No.1 rightly, after properly verifying the facts and documents, have repudiated the claim and legally in such like circumstances, the repudiation is not questionable before this Commission.
Further legal objections are that neither there is any deficiency of service, on the part of opposite party No. 1 nor it had ever adopted any unfair trade practice, as wrongly alleged by complainant. So complaint is baseless, wrong, vague, self-contradictory, illegal, against facts & deserves to be dismissed with costs. That complainant has no cause of action or locus standi to file this complaint. That there is specific arbitration clause in the policy so the adequate remedy with the complainant, if any, was to get referred the matter in question to the arbitrator. That complainant is estopped from filing this complaint due to his acts, conducts, admissions, omissions and acquiescence. That the complaint is bad for non-joinder of necessary parties like Surveyor against whom allegations have been made & misjoinder of party i.e. opposite party No. 2 has un-necessarily been impleaded in this case. That complainant has not produced all required documents along with complaint. That the complaint is false, frivolous, vexatious, wrong, illegal, against facts, baseless, unfounded & has been filed with malafide intention to harass the opposite party.
On merits, it has been pleaded that insurance policy is issued subject to its terms and conditions which are binding on both parties to it. The insurance policy issued by the opposite party No. 1 was complete of 3 pages but complainant has knowingly, wilfully, dishonestly, with malafide intention has not produced remaining two pages of policy with this complaint and has illegally and against facts pleaded that insurance policy was not issued to him. The opposite party No. 1 has admitted that complainant has intimated on 13.08.2019 that his motor cycle has been stolen on 31.03.2019 from New Delhi and FIR No. 011404 dated 31.03.2019 had been lodged. A perusal of said copy of FIR reveals that one Appar Bandhu had lodged the same alleging that his Motor cycle bearing registration No.PB-03-AJ-2442 has been stolen from Satya Niketan, between 16:30 and 17:30 on 31.03.2019, but it does not find mention that M/cycle was owned by the complainant or if the same was lying locked or was in custody of contractor of parking place or was left un-attended in the open.
It has been further pleaded that even letter alleged to have been issued by Krishan Kapoor (opposite party No. 2) has been manoeuvred in his connivance. The alleged intimation, if any to opposite party No. 2 cannot be treated as intimation to Insurance Company/opposite party No.1. The opposite party No.1 admitted that after receiving intimation dated 13.08.2019 the OP No.1 appointed investigator Mr. Sunil Jain, who had demanded required documents from the complainant. As per letter dated 23.08.2019 of Sunil Jain, Investigator sent to the complainant, it was duly intimated to the complainant that he had violated the condition precedent to any liability of the company to make payment under the policy, he was bound to intimate the company about the alleged occurrence and loss on the date of happening and immediately, but he had intimated the company only on 13.08.2019 for the first time, which has rendered his claim inadmissible, but even then the explanation of complainant was sought vide said letter by the investigator, to which no reply was given, meaning thereby till then no such letter which has been now produced was in existence otherwise complainant must have given reply and also supplied copy of said letter to the said investigator. Thus this letter has been manufactured only at the time of preparation of complaint and as such, has got no legal authenticity nor is reliable in any manner. The alleged non-traceable certificate is dated 17.07.2019, but the intimation to opposite No.1 is dated 13.08.2019 i.e. after 27 days of the same. After controverting all other averments of the complainant, the opposite party No. 1 prayed for dismissal of complaint.
In support of his complaint, the complainant has tendered into evidence photocopy of R.C. of vehicle (Ex. C-1), photocopy of Insurance Certificate (Ex. C-2), photocopy of FIR (Ex. C-3), photocopy of Certificate (Ex. C-4), photocopy of order (Ex. C-5), photocopy of repudiation letter (Ex. C-6) and affidavit of complainant (Ex. C-7).
In order to rebut the evidence of complainant, the opposite party No. 1 has tendered into evidence affidavit dated 10-2-20 of Baldev Singh (Ex. OP-1/1), photocopy of policies (Ex. OP-1/2 to Ex. OP-1/4), photocopy of claim intimation (Ex. OP-1/5), photocopy of Investigation report (Ex. OP-1/6), photocopy of letter of Investigator alongwith postal receipt (Ex. OP-1/7) and photocopy of Investigator Report (Ex. OP-1/8).
Learned counsel for the parties reiterated their stand as taken in their respective pleadings.
We have heard learned counsel for the parties and gone through the record.
In nutsell the case of the complainant is that his Royal Enfield Motorcycle bearing Registration No. PB-03AJ-2442 Model 12/2014 is comprehensively insured with opposite party No. 1 vide Insurance Certificate No. 2004013116P10541189 for the period from 25-7-2018 to 24-7-2019 for the IDV of Rs. 80,000/- with opposite party No. 1. The said vehicle of the complainant was stolen by some unknown person on 31-3-2019. Appar Bandhu son of the complainant intimated the police of Police Station, South Campus, South West, Crime Branch Delhi and lodged FIR No. 011404 dated 31-3-2019 under Section 379 IPC (Ex. C-3). The complainant submitted requisite documents including Non-traceable Certificate with opposite party No. 1, but opposite party No. 1 repudiated claim of the complainant vide letter dated 31-10-2019 (Ex. C-6).
The repudiation letter (Ex. C-6) reads as under :-
“Please note that your file stands repudiated and closed on account of below reason :-
The claim is non-maintainable due to breach of policy terms and conditions as mentioned below :-
Condition No. 1 (Delay in intimation) – Notice shall be given in return to the company immediately upon occurrence of any incidental 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.
We absolve outselves from any further liabilities, arising out of this claim, which please note.”
Thus, the opposite party No. 1 repudiated the claim of the complainant on the ground of delay in intimation on the basis of Condition No. 1. A perusal of Condition No. 1 reveals that in case of theft or other criminal act which may be the subject of a claim under this policy, the insured shall give immediate notice to the police and co-opeate with the company in securing the conviction of the offender. So, it was the duty of the insured to give immediate notice to the police which the insured/complainant in this case, performed well.
The complainant alleged that he intimated the loss in question to opposite party No. 2 who is agent of opposite party No. 2. To prove his version, complainant has placed on file a letter/certificate dated 3-9-2019 (Ex. C-4) issued by opposite party No. 2 which shows that said agent has admitted that complainant informed him i.e. opposite party No. 2 (agent Code No. 29750) on 2-4-2019 regarding theft of his motorcycle which took place on 31-3-2019 and opposite party No. 2 advised him to get non-traceable certificate from Delhi Police and keep ready different documents required for claim.
Therefore, when opposite party No.1 appointed opposite party No. 2 as agent, as this fact is not denied by opposite party No. 1 and opposite party No. 1, authorised opposite party No. 2 to effect insurance on behalf of opposite party No. 1, the opposite party No. 1 cannot be permitted to deny claim by taking a plea that Krishan Kapoor (opposite party No. 2) was not competent authority to be intimated regarding alleged theft. Moreover, in this case, Appar Bandhu, son of the complainant intimated the police of Police Station (South Campus, South West) Crime Branch, Delhi, on the same day i.e. 31-3-2019 and FIR No. 011404 dated 31-3-2019 under Section 379 (Ex. C-3) was lodged. It is admitted fact of opposite party No. 1 that complainant submitted Non-traceable Certificate (Ex. C-5) with opposite party No.1. The police investigated the matter and thereafter non-traceable certificate was got issued. Hence, the complainant done his duty by intimating the Insurance Company through its agent as well as to police regarding theft of the vehicle in question. No further action was required from complainant at that particular time. Thereafter, complainant submitted requisite documents including non-traceable report with opposite party No. 1.
The I.R.D.A has issued circular regarding delay in claim intimation/documents submissions. For the sake of convenience, the circular is being reproduced as under :-
“ Ref No. IRDA/HLTH/MISC/CIR/216/09/2011 Dated 20-09-2011
C I R C U L A R
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."
Similarly Head Office of the opposite party has also issued letter dated 24-2-2012 to all Regional Offices
“Motor/HO/Cir.No./2012/08 24-02-2012
To - All Regional Offices
Re: Delay by insured in giving intimation to insurer in case of Theft of the vehicle insured.
Motor department is receiving queries from many Regional offices regarding IRDA circular IRDA/HLTH/MISC/CIR/216/09/2011 dated 20-09-2011 dealing with delay in claim intimation / documents submission with respect to non life insurance contracts. ROs seeking HO advice as to how to deal with Motor OD claim (particularly theft claims) where there is delay in claim intimation/ documents submission on the part of the insured. HO after perusing above IRDA circular and some of the NCDRC judgments on the issue wishes to advise the ROs as follows :
1) No claim shall be repudiated just because there is a delay
2) If there is delay of more than 24 hours in giving intimation to us by insured, an explanation in writing from the insured must be taken and recorded.
3) If the delay is proved to be material to avoiding / minimizing the loss the claim shall be repudiated. However circumstances (4) and (5) below shall be considered.
4) If the insured was negligent about informing the loss immediately and if a timely investigation could have given positive results, then the claim depending on the nature and material impact of such negligence , can be repudiated or paid as Non Standard upto 75%.
5) If insured has acted as if uninsured and delay was totally beyond his control claim may be settled on Standard Basis.
6) As mentioned in IRDA circular IRDA/HLTH/MISC /CIR/216/09/2011 dated 20-09-2011, there should be no compromise on bad claims.
7) AIl the offices must ensure that Investigator is appointed within 24 hours of receipt of intimation. Wherever delay in intimation has been recorded, the investigator can asked to look into the reported circumstances of the delay.
We are forwarding the same to you for your perusal and guidance and circulation to all operating offices under your control.”
From the perusal of aforesaid circular/letter, it is clear that delay in intimation should not prevent settlement of genuine claim.
Hon'ble Supreme Court in the case titled Gurshinder Singh Vs. Shriram General Insurance Co. Ltd., & Anr (2020 (1) Apex Court Judgements (SC) 266 has held :-
“Insurance Claim – Delay in intimating insurance company about occurence of theft no ground to deny claim.
Consumer Protection Act – Theft of vehicle – Delay in intimating to Insurance Company – Denial of Insurance claim – when insured lodged FIR immediately after theft of a vehicle occurred and when police after investigation have lodged a final report after vehicle was not traced and when surveyor/investigator appointed by insurance company found claim of theft to be genuine, then mere delay in intimating insurance company about occurrence of theft cannot be a ground to deny claim – Held lodging of FIR on same day theft occurred – Therefore, denial of claim set aside.”
The observations of Hon'ble Apex Court in para No. 11 in the case Om Parkash Vs. Reliance General Insurance & Another IV(2017) CPJ 10 (SC) are as under :-
It is a common knowledge that a person who lost his vehicle may not straightway go to the Insurance Company to claim compensation. At first, he will make efforts to trace the vehicle. It is true that the owner has to intimate the insurer immediately after the theft of the vehicle. However, this condition should not bar settlement of genuine claims particularly when the delay in intimation or submission of documents is due to unavoidable circumstances. The decision of the insurer to reject the claim has to be based on valid grounds. Rejection of the claims on purely technical grounds in a mechanical manner will result in loss of confidence of policy-holders in the insurance industry. If the reason for delay in making a claim is satisfactorily explained, such a claim cannot be rejected on the ground of delay. It is also necessary to state here that it would not be fair and reasonable to reject genuine claims which had already been verified and found to be correct by the investigator. The condition regarding delay shall not be a shelter to repudiate the insurance claims which have been otherwise proved to be genuine. It needs no emphasis that the Consumer Protection Act aims at providing better protection of the interest of consumers. It is beneficial legislation that deserves liberal construction. This laudable object should not be forgotten while considering the claims made under the 'Act'.”
A perusal of aforesaid observations reveals that Insurance Companies are not justified to reject the claims on purely technical grounds in a mechanical manner and the condition regarding delay shall not be a shelter to repudiate the insurance claims which have been otherwise proved to be genuine. Therefore, the repudiation on the ground of delay is not justified as complainant intimated the loss to agent of opposite party No. 1 in time and also informed the police on the same day. Thus, there is deficiency in service on the part of opposite party No. 1 in repudiating the genuine claim of the complainant without any reason. Hence, the complainant is entitled to the Insured's Declared Value (IDV) of the vehicle in question as per insurance policy (C-2), with interest.
In view of what has been discussed above, this complaint is partly allowed with Rs. 10,000/- as cost and compensation against opposite party No. 1 and it stands dismissed qua opposite party No. 2. The opposite party No. 1 is directed to pay to complainant an amount of Rs. 80,000/- with interest @ 9% p.a. w.e.f. 31-10-2019 (date of repudiation), till realization.
The complainant is directed to sign the documents, if any, required by opposite party No. 1 and complete the other formalities, if any, required by law for release of claim .
The compliance of this order be made by opposite party No. 1 within 45 days from the date of receipt of copy of this order.
The complaint could not be decided within the statutory period due to heavy pendency of cases.
Copy of order be sent to the parties concerned free of cost and file be consigned to the record.
Announced :
22-3-2022
(Kanwar Sandeep Singh)
President
(Shivdev Singh)
Member
(Paramjeet Kaur)
Member
