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Judgment
Prem Narain, Presiding Member
This revision petition has been filed by the petitioner Royal Sundram Alliance Insurance Co. Ltd. against the order dated 30.4.2013 of the State Consumer Disputes Redressal Commission, Gujarat, (in short 'the State Commission') passed in Appeal No.425 of 2011.
Brief facts of the case are that the respondent/complainant was having an insurance cover for his vehicle from 14.3.2009 to 13.03.2010 given by the petitioner/opposite party. The vehicle was insured for IDV of Rs.12,86,180/-. The vehicle was stolen on 25.08.2009. The complainant informed the police on 27.08.2009 by filing the FIR. It is the case of the complainant that the complainant also informed the agent of the insurance company from whom he had taken the insurance policy, however, the claim of the insurance company is that intimation was given after five days. The Insurance Company repudiated the claim on the ground that there was a delay in giving intimation to the Insurance Company as well as to the police.
Aggrieved with the repudiation, the complainant filed a consumer complaint bearing No.228 of 2010 before the District Consumer Disputes Redressal Forum, Rajkot, (in short 'the District Forum'). The complaint was resisted by the Insurance Company on the same ground as given in the repudiation letter dated 12.03.2010. The District Forum, however, allowed the complaint vide its order dated 22.3.2011 as under:-
"Complaint is allowed.
Opponent do pay Rs.12,86,160/- to the complainant with running interest @8% p.a. from the date of repudiation within 30 days from the date of this order. Failing which, it will carry 10% interest.
Opponent to incur its own cost and should pay Rs.2,000/- towards cost to the complainant."
The opposite party/petitioner herein preferred appeal bearing No.425 of 2011 before the State Commission. The State Commission vide its order dated 30.04.2013 rejected the appeal.
Hence the present revision petition.
Heard the learned counsel for both the parties and perused the record. Learned counsel for the petitioner stated that the intimation to the police was given after 48 hours and the intimation to the insurance company has been given after five days. In the matter of theft, an immediate intimation is required to be given to the police as well as to the Insurance Company. The District Forum has wrongly interpreted the condition No.1 that in case of theft, notice is required to be only given to the police. There is no requirement that immediate notice should be given to the Insurance Company.
Learned counsel for the petitioner stated that the first sentence of the condition states that immediate intimation is required to be given to the Insurance Company in the case of accident, loss or damage. Theft is also a loss and therefore, first line of the condition is also applicable in the incident of theft. In case of theft of the vehicle, additional requirement has been put in the policy that police will also be intimated so that the Insurance Company and the police may search for the vehicle. The learned counsel referred to the judgement of the Hon'ble Supreme Court in Oriental Insurance Co. Ltd. Vs. Parvesh Chander Chadha, Civil Appeal No.6739 of 2010, decided on 17.08.2010 (SC) and stated that giving information to the agent of the Insurance Company is worthless as observed by the Hon'ble Supreme Court in this judgment as follows:-
"Before the District Forum, the respondent did state that he had given copy of the first information report to Rajender Singh Pawar through whom he had insured the car and untraced report prepared by police on 19.9.1995 was given to the said Shri Rajender Singh Pawar, but his explanation was worthless because in terms of the policy, the respondent was required to inform the appellant about the theft of the insured vehicle."
It was further mentioned by the learned counsel for the petitioner that the respondent has not submitted the keys of the vehicle and therefore, it is apprehended that the keys were left in the vehicle that is why the same was stolen. As there is clear negligence on the part of the respondent, the claim is not payable. To support his argument learned counsel referred to judgment of this Commission in Jagdish Prasad Bakshi Vs. Oriental insurance Co. Ltd. III (2014) CPJ 134 (NC).
On the other hand, learned counsel for the respondent/complainant stated that the question of keys has been raised for the first time as it is not mentioned in the repudiation letter or written statement filed by the Insurance Company. Hence this issue cannot be considered in the revision petition. Learned counsel further mentioned that both the fora below have given concurrent finding of fact and the scope under the revision petition is quite limited as the facts cannot be reassessed at the stage of revision petition.
It was further pointed out by the learned counsel for the respondent that the condition no.1 of the policy relates to giving intimation to the Insurance Company in the case of accident. In case of theft, the intimation was required to be given only to the police and therefore, there was no necessity of any immediate intimation to the Insurance Company. This view has been held by this Commission in RP No.2618 of 2013, Bajaj Allianz General Insurance Company Ltd. Vs. Abdul Sattar & Anr., decided on 27.1.2016 (NC), wherein following has been observed:-
"11. In order to appreciate the contention of the petitioner, it would be useful to have a look on relevant condition no.1 of the insurance policy, which is reproduced as under:
"1. Notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage 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."
On reading of the above, it is clear that in the event of the theft of the vehicle, only requirement on the part of the insured was to intimate the police immediately and cooperate in securing the conviction of the offender."
Coming to the question of delay in giving intimation to the Insurance Company, the learned counsel stated that the intimation was first given to the agent through whom the policy was obtained. Agent has filed the affidavit. He intimated to the office of the Insurance Company on telephone. Thus, it is wrong to say that no intimation was given to the Insurance Company immediately. Insurance Company has accepted the intimation in writing after five days of the incident. Learned counsel stated that no genuine claim can be repudiated on the ground of delay and instructions have been issued to all the Insurance Companies by the IRDA vide Circular No. IRDA/HLTH/MISC/CIR/216/09/2011 dated 20.09.2011. The circular reads as under:-
"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 policyholders 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."
Apart from the above guidelines of IRDA, learned counsel emphasised that the Hon'ble Supreme Court in the matter of Om Prakash Vs. Reliance General Insurance & Anr, IV (2017) CPJ 10 (SC) has condoned the delay of eight days in giving intimation to the Insurance Company and the present case is only for a delay of five days.
I have carefully considered the arguments advanced by both the learned counsel for the parties and have examined the record. First of all, it is seen that both the fora below have given concurrent finding of fact relating to theft of the vehicle and intimation to the police as well as to the Insurance Company. Both the fora below have agreed with the view that the immediate intimation to the Insurance Company shall not be required in the case of theft of the vehicle and only the necessary condition is that the insured should give intimation to the police. On this basis the complaint has been accepted by the District Forum and on same ground appeal of the opposite party has been dismissed. Though it is true that this view has been upheld by this Commission in RP No.2618 of 2013, Bajaj Allianz General Insurance Company Ltd. Vs. Abdul Sattar & Anr. (supra), but the Hon'ble Supreme Court in Om Prakash Vs. Reliance General Insurance & Anr. (supra) has not accepted this view and has held the following:-
"10. Condition No.1 of the Insurance Policy states that notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage in the event of any 7claim and thereafter the insured has to give all such information and assistance as the company may require.
It is common knowledge that a person who lost his vehicle may not straightaway 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.
On the basis of the above observation of the Hon'ble Supreme Court in Om Prakash Vs. Reliance General Insurance & Anr. (supra), it is clear that even in the case of theft, immediate intimation to the Insurance Company is equally important as the intimation to the police. It is also true that Hon'ble Supreme Court has accepted the delay of 8 days in informing the Insurance Company, but that acceptance is based on the explanation provided by the insured. In fact the Hon'ble Supreme Court in Om Prakash Vs. Reliance General Insurance & Anr. (supra) has observed the following:-
"11. ........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."
In the present case the only explanation given by the insured is that he has informed the agent and the agent informed the Insurance Company on telephone. Clearly, in the light of the judgment of Oriental Insurance Co. Ltd. Vs. Parvesh Chander Chadha (supra), this explanation of the insured is not acceptable and condition No.1 has been violated as intimation to the police was given after 48 hours and intimation to the Insurance Company was given after 5 days. Hon'ble Supreme Court in Amalendu Sahoo Vs. Oriental Insurance Co. Ltd., II (2010) CPJ 9 (SC) has observed that if certain condition of the policy which is not a fundamental condition is violated, the insurance claim can be settled on non-standard basis under which the claim can be accepted upto 75% of the accepted claim. Keeping the directions of the IRDA issued vide Circular No. IRDA/HLTH/MISC/CIR/216/09/2011 dated 20.09.2011 and in the light of the judgment of the Hon'ble Supreme Court in Amalendu Sahoo Vs. Oriental Insurance Co. Ltd. (supra), the claim can be accepted on the non-standard basis.
Based on the above discussion, the revision petition is partly accepted and the petitioner Insurance Company is directed to pay the insurance claim on non-standard basis i.e.75% of the IDV of the vehicle. Thus, the insurance company shall pay a sum of Rs.9,64,620/- to the respondent/complainant along with 8% p.a. interest from the date of filing of the complaint i.e. 7.9.2010 till actual payment. Consequently, the order of the District Forum dated 22.03.2011 stands modified. The cost of litigation awarded by the District Forum Rs.2000/- (rupees two thousand) is maintained. This order be complied with by the petitioner Insurance Company within a period of 45 days from the date of receipt/service of this order.