New India Assurance Company Ltd. Vs. Pravin Krushna Tatkari - (National Consumer Disputes Redressal Commission) (13 Jul 2017)

Insurance Company cannot repudiate claim in toto in case of loss of vehicle due to theft

MANU/CF/0414/2017

Consumer

Challenge in present Revision Petition under Section 21(b) of Consumer Protection Act, 1986 is to order passed by Maharashtra State Consumer Disputes Redressal Commission (State Commission). By impugned order, State Commission has allowed Appeal, directing Insurance Company to pay to Complainant’s claim amount of 10,75,250/-, with interest @ 9% p.a. from date of filing of Consumer Complaint. Insurance Company has also been directed to pay a compensation of 50,000/- and cost of 20,000/- to Complainant. Brief point that falls for consideration is whether Insurance Company was justified in repudiating claim by invoking Clause 5 of terms and conditions on ground that, Complainant had not taken due care and caution while parking vehicle and invited theft.

It is not in dispute that, theft took place during validity period of Insurance policy and that incident was duly intimated to Insurance Company and an FIR was also filed in concerned Police Station. Clause 5 of said terms and conditions provides that, insured shall take all reasonable steps to safeguard vehicle insured from loss or damage and to maintain it in efficient condition and Company shall have at all times free and full access to examine the vehicle insured or any part thereof any driver or employee of Insured. In event of any accident or breakdown, vehicle insured shall not be left un-attended without proper precautions being taken to prevent further damage or loss and if vehicle insured be driven before necessary repairs are effected, any extension of the damage or any further damage to vehicle shall be entirely at Insured's own risk.

Specific pleading of Insurance Company is that, when vehicle was parked in an open space and door had no lock, Complainant ought to have appointed someone as security personnel for vehicle is completely unjustified. It is pertinent to note that, "standard reasonable care" has not been specifically defined in policy, for Insurance Company to repudiate whole claim on basis of "proper precautions" not being taken. Stand of Insurance Company that Complainant, in a contingency situation, where, there is breakdown of insured vehicle, should appoint security personnel to take care of vehicle, is truly beyond any reasonable expectation and such an argument only goes to show that, term "reasonable care", is being construed to advantage of Insurance Company.

Apex Court in National Insurance Company Limited Versus Nitin Khandelwal, observed that, Insurance Company cannot repudiate claim in toto in case of loss of vehicle due to theft. In view of judgment of Apex Court and fact that there was a statement made by driver that, door was not locked and there was no window glass, Commission is of opinion that, claim can deserves to be allowed on non-standard basis as there is no fundamental breach of any of conditions stipulated in contract. Hence, this Revision Petition is allowed in part reducing decretal amount awarded by State Commission to 75% of 10,75,250/-, to be paid by Insurance Company to Complainant, with interest @ 9% p.a. from date of repudiation till date of realization, within four weeks from date of receipt of this order.

Relevant : National Insurance Co. Ltd. vs. Nitin KhandelwalMANU/SC/7639/2008 Tags: Compensation, Quantum, Validity

Tags : COMPENSATION PAYMENT DIRECTION VALIDITY