Consumer complaint No. – CC-68/2024

Before the District Consumer Disputes Redressal Commission, at Bengaluru Urban, Karnataka

IN RE:-

SH. RAJEEV KUMAR JHA ……………………………………..…....................COMPLAINANT

VERSUS

M/s. ORIENTAL INSURANCE COMPANY LIMITED(OICL); Mr. Amarendra Jha (Regional Manager)-OICL; Mr. Rajendra Kumar (Regional Manager)-OICL; General Manager- INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA (IRDAI); GENERAL INSURANCE COUNCIL(GIC-IRDA); & M/s. KOTAK MAHINDRA PRIME LTD. …….………………OPPOSITE PARTIES

Before the District Consumer Disputes Redressal Commission, at Bengaluru Urban, Karnataka Before the District Consumer Disputes Redressal Commission, at Bengaluru Urban, Karnataka

Through Counsel: -                                                Rajeev Kumar Jha, Advocate

FLAT NO.-50808, TOWER-5, NIKOO HOMES-1, BHARTIYA CITY, THANISANDRA MAIN ROAD, BANGALORE-560064

 

Before the District Consumer Disputes Redressal Commission, at Bengaluru Urban, Karnataka

Consumer complaint No. _CC/68/2024

 

 RAJEEV KUMAR JHA

Age-50years                                                         

 Address: Flat No.- 50808,

TOWER-5, NIKOO HOMES-1,

Bhartiya City, Thanisandra Main Road,

Bangalore, KARNATAKA-560064

MOBILE No.- +91-9911661818

EMAIL: sarvadvisory@gmail.com    .............................................................................................. COMPLAINANT

 

  

MEMO OF PARTIES

 

ORIENTAL INSURANCE COMPANY LIMITED

Registered Office :

The Oriental Insurance Company Ltd.,
 ”Oriental House”, A-25/27 Asaf Ali Road,
New Delhi-110002

MOBILE No.- 9335152276

EMAIL: csd@orientalinsurance.co.in

              gro@orientalinsurance.co.in  ..................................OPPOSITE PARTY-1 (OP-1)

 

 Mr. Amarendra Jha, (Regional Manager),

ORIENTAL INSURANCE COMPANY LIMITED  

 Registered Office :

The Oriental Insurance Company Ltd.,
 ”Oriental House”, A-25/27 Asaf Ali Road,
New Delhi-110002

CIN: U66010DL1947GOI007158

MOBILE No.- 7042689169

EMAIL: akjha@orientalinsurance.co.in        ......................................OPPOSITE PARTY-2  (OP-2)

 

 

Mr. Rajendra Kumar, (Regional Manager),

ORIENTAL INSURANCE COMPANY LIMITED  

 Registered Office :

The Oriental Insurance Company Ltd.,
 ”Oriental House”, A-25/27 Asaf Ali Road,
New Delhi-110002

CIN: U66010DL1947GOI007158

MOBILE No.- 9871428293

EMAIL: rajendarkumar@orientalinsurance.co.in    ....................................................OPPOSITE PARTY-3  (OP-3)

 

 

General Manager

INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA (IRDAI)

Policyholder's Protection & Grievance Redressal Department – Grievance Redressal Cell.

Sy.No.115/1, Financial District, Nanakramguda,

Gachibowli, Hyderabad – 500 032.

EMAIL: complaints@irdai.gov.in;

            irda@irdai.gov.in ; padmaja@irdai.gov.in     ..........................OPPOSITE PARTY-4  (OP-4)

 

 GENERAL INSURANCE COUNCIL,

ROYAL INSURANCE BUILDING, 5TH FLOOR, 14, JAMSHEDJI TATA ROAD, CHURCHGATE,

MUMBAI – 400 020.

TEL.NO.:- 022-22817511

E-mail: gicouncil@gicouncil.in   .....................................................OPPOSITE PARTY-5  (OP-5)

 

 

KOTAK MAHINDRA PRIME LTD.

2nd Floor, SCO-61,

OLD JUDICIAL COMPLEX,

SECTOR-15, GURGAON,

HARYANA-122001

MOBILE No.-

EMAIL: service.carfinance@kotak.com         .................................OPPOSITE PARTY-6  (OP-6)

 

 

 

Complaint file under Section 35 of the Consumer Protection Act, 2019

 

MOST RESPECTFULLY SHOWETH:

INTRODUCTION OF COMPLAINANT: -

1.    That above said complainant is a resident of Bangalore as above-mentioned address since June 2023 with his family and is respectable citizen, having great regard and respect for the laws of the country.

2.    INTRODUCTION OF OPPOSITE PARTY NO. 1, 2 &3.

That the Opposite Party No.1, is M/S. ORIENTAL INSURANCE COMPANY LIMITED organization having registered office at: - “Oriental House”, A-25/27 Asaf Ali Road, New Delhi-110002. having IRDA Regn. No. 556,                                                            CIN: U66010DL1947GOI007158 and Opposite Party No. 2 & 3 are the employees of opposite party no.1 through employment contract agreement.

3.    INTRODUCTION OF OPPOSITE PARTY NO. 4 & 5

That the opposite party no.4 is organization under the name & style of INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA (IRDAI)

having registered office at: - Policyholder's Protection & Grievance Redressal Department – Grievance Redressal Cell., Sy.No.115/1, Financial District, Nanakramguda, Gachibowli, Hyderabad – 500 032 and Opposite Party No.5 The GENERAL INSURANCE COUNCIL (GIC), is representative body of general insurers registered with Opposite Party No.4 and came into existence after passage of the Insurance Laws (amendment) Act in April 2015 acting as self-regulatory organization for the non-life insurance industry’s market conduct and practices. They have registered office at: - Royal Insurance Building, 5th Floor, 14, Jamshedji Tata Road, Churchgate, Mumbai – 400020.

INTRODUCTION OF OPPOSITE PARTY NO. 6

4.     That the opposite party no.6, is M/S. Kotak Mahindra Prime Ltd. organization having registered office at: - 2nd Floor, SCO-61, Old Judicial Complex,             Sector-15, Gurgaon, Haryana- 122001

 

TRANSACTION AND FACT OF THE CASE:

 

5.    That the complainant is a consumer within the definition of the Consumer Protection Act and constrained to approach this Forum against the gross acts of the opposite parties wherein these have committed serious deficiency of services and unfair trade practices.

6.     That the complainant was the owner of the Car (Fortuner) (hereinafter referred to as “the vehicle”) bearing Registration No. UP-16BQ-7755 and took car finance from Kotak Mahindra Prime ltd. Having Loan Account No CF – 14981391, Loan Agreement Date 21-Oct-2017, CRN (Customer Relationship No) 45157240, Loan Amount Financed in Rs. 28,46,000.00, which Loan Maturity Date 01-Oct-2022, Loan Principal outstanding in Rs. 1,15,549.14 by 25th August 2022. ANNEXURE-    

7.    That the complainant   was consistently took vehicle Zero debt insurance from day-one of the purchase of vehicle and regularly renewed his zero debt insurance policy and had a valid insurance policy (Policy No. 211200/31/2022/158842) for the Insured Declared Value of Rs.18,45,000/- for the period 15.10.2021 to 14.10.2022. ANNEXURE-    

8.    That the Vehicle was stolen on August 15, 2022 (16 months ago), while it was parked outside complainant home, Gurgaon. The house is in HUDA gated colony where it is general practice by all residents to park the vehicle in open space of the plot.

9.    That On the same day, he registered an FIR in Sector-50, Gurgaon Police station and informed Oriental Insurance company through email. ANNEXURE-         & ANNEXURE-    

10.That the mail address provided in the policy document was written and informed to them. But, mail address in policy didn’t work and mail got bounced back. ANNEXURE-  

11.That Then complainant had to contact their helpline contact number multiple times and finally was able to obtain valid mail address of Opposite Party-1 to communicate them about the incident. ANNEXURE-      

12.That the complainant on 25th August 2022 also informed state transport department ( helpdesk-vahan@gov.in , helpdesk-sarathi@gov.in ) and shared all relevant documents related to theft case, written complain & FIR copy, CCTV footage, etc. and received confirmation mail on 26th August 2022 from them as well. ANNEXURE-       & ANNEXURE-     

13.That the complainant on 25th August 2022 also informed through mail to Opposite party-06 (Kotak Mahindra Prime Ltd.) about the incident and shared all relevant information and evidence documents. ANNEXURE-  

14. That The Complainant diligently followed up day and night with the crime branch to trace the vehicle's movement from one location to another. He provided all the necessary information and details to aid the Police crime branch in their efforts to trace the vehicle and apprehend the thieves. Through regular follow-up, on 2nd September, 2022, the theft case was successfully uploaded into the crime branch Central database record. ANNEXURE-     

15.That the complainant Despite multiple follow-ups and escalation to senior management of opposite parties 1 & 4 and Chandigarh ombudsman (as provided on the website of opposite parties-1,2&3) there was no response from anyone.

16.That Finally, complainant had to file complain in BimaBharosa portal of Opposite party-4 on 24th Oct 2022. ANNEXURE-    

17. That the until 04th Nov 2022, complainant received no response, so finally wrote mail to all concerned highest authority of Opposite parties-1,2,3 & 4 and Chandigarh Ombudsman (as provided on the Opposite party 1 portal) stating for early resolution of the case and on the same day everyone was activated and responded. ANNEXURE-   

18. That the it took 2.5 months for a surveyor to be appointed to investigate complainant case. The complainant received mail from surveyor to share the list of documents, information & facts of the case.  ANNEXURE-    

19. That the complainant received mail from Opposite party-4 and requested opposite party-1 to respond to the complain and resolve the issue immediately: ANNEXURE-       

Please find herewith attached a reminder from the complainant on the complaint registered with IRDAI Token No:10- 22-007109. You are hereby advised to resolve the same immediately, inform the applicant and duly update the status in IGMS.

 

20.That the surveyor visited the complainant home on 09th Nov 2022 and collect all relevant KYC documents, Valid license copy, Valid Insurance policy, FIR & written police complaint information, Original & Duplicate Keys of vehicle, and CCTV footage, etc. ANNEXURE-         

  1.  That then on 15th Nov 2022, they raised few more documents list requested to share the same, whereas complainant very clearly told them about unavailability of these documents, except Original RC and FIR: ANNEXURE-  

After investigation we found that some documents related to the theft claim of vehicle no. UP-16-BQ-7755 are still pending, please arrange and share the pending documents as soon as possible. 1 - Acknowledge copy of RTO safe custody letter & RC particular of the vehicle. (Format attached) 2 - Non-repossession letter from the financer / NOC of the vehicle. 3 - Purchase Invoice (original or duplicate) of the vehicle. 4 - Please share GPS record of the vehicle (if available)5 5 - Final Untraced Court report of the vehicle, if received.

22. That the complainant was confirmed through mail by surveyor that they had submitted complainant file to the insurance company along with all the relevant documents and evidence. But, did not share the survey report with complainant. ANNEXURE-   

 

23. That the complainant requested several times on phone for copy of survey report but they never shared the same.

 

24.That then based upon surveyor report submission, the opposite party-1,2&3 insurance company requested an NTR non-traceable report from the police in order to process our insurance claim. ANNEXURE-     

 

25. That the complainant diligently ran from one crime branch to another, as complainant case kept getting transferred in Gurgaon from one to another Sector crime branch. Eventually, complainant approached the District Commissioner Crime Branch, Gurgaon, and urged for action.

 

26. That the in December 2022, the crime branch finally apprehended all the thieves. The investigation and search for the Vehicle continued, and on         14th February 2023, they filed a chargesheet in court. ANNEXURE-   

 

27.That complainant immediately applied for true copy of Chargesheet and After a week, on 26th February,2023 complainant provided a copy of the chargesheet to the insurance company as they requested. ANNEXURE-    

 

28.That the Opposite parties-1,2&3 Unfortunately, they rejected the chargesheet, stating that it did not meet their desired NTR Non-traceable report requirements. ANNEXURE-    

 

29. That the complainant then approached the Hon’ble Gurgaon District Court, requesting an order for the Crime Branch to issue an NTR. However, the Hon'ble court denied our request, stating that in cases of apprehending thieves, they do not issue such orders, and the chargesheet itself should be considered as an NTR. ANNEXURE-       , ANNEXURE-         , & ANNEXURE-   

 

30.That the same was conveyed to the insurance company to investigate the matter. However, the Opposite parties-1,2&3 insurance company refused to accept the chargesheet and verbal order of the court, whereas demanded a written order instead. ANNEXURE-    

 

31.That Afterward, complainant filed an application on 31st May,2023 in the Hon’ble court prayed to provide Untrace report from police: -

ANNEXURE-  

PRAYER

It is therefore, most humbly prayed that this Hon’ble court may be please to:

A.    Allow the application to provide the NTR to the complainant for the reasons above.

B.    Disallow the application as the Hon’ble court deems fit.

C.    Pass any other order as the Hon’ble court deems fit.

 

32.That the On 29th August,2023, the court provided a clear clarification that the chargesheet itself contained the untraceability of the Vehicle, which the police had filed. Following as stated by Court-

 

“Today the case was fixed for filing of reply of application for directing the concerned police station to allow non-traceable report in present FIR. Reply filed by the concerned I.0. As per the reply, challan in present case qua some accused has already been presented in Court on 08.02.2023. The I.0. further stated that stolen vehicle could not be recovered yet. Heard. Perusal of case file reveals that the applicant/complainant had filed the present application for directing the concerned I.0. to file non-traceable re - port in the case, but as above stated a challan has been filed in present case. Hence, the application of applicant/complainant is infructuous. Accordingly same is dismissed. Papers be tagged with main file.”

 

Thus, Complainant application was dismissed and a written order was passed on 12th September 2023. Court Order-ANNEXURE-    

 

33. That the On September 12th, 2023, complainant received a copy of the court order and shared it with the opposite parties-1,2,3&4 insurance company, its GRO officials and IRDAI. ANNEXURE-    

 

34. That the After waiting for 30 days without receiving an update from the Opposite parties-1,2,&3 insurance company, complainant wrote reminder mail requesting the closure of his insurance claim settlement. ANNEXURE-  

 

35.That However, even after one week, complainant received a brief email from opposite parties-1,2&3 stating that documents were under review and had been forwarded to the concern authority. ANNEXURE- 

 

36.That Later 09th November 2023, Complainant received email from Opposite parties-1,2&3 stating that –                                                              ANNEXURE- 

 

“The claim in subject case has been discussed with competent authority at length. The final untrace report duly accepted by court being mandatory document in subject case and hence claim cannot be processed further without the same.”

 

37.That the mentioned earlier, the Opposite parties-1,2,&3 insurance company denied the verbal order of the Hon’ble Court and requested THRICE on mail for Hon’ble Court written order instead. Once the written order was provided, they then requested an untrace report, which has brought the complainant back to ‘square one’.

 

38.That the Complainant checked the BimaBharosa website to inquire about the status of his complaint. Unfortunately, complainant could not find any updates. ANNEXURE- 

 

39. That the result, complainant called Opposite party-4 (IRDA) to their toll-free number and was informed that opposite party-1,2&3 (Oriental Insurance Company) by providing false information and mislead opposite party-4 (IRDAI), they had closed my case.

 

40.That the in fact, complainant have not received any information or communication regarding this matter  from Opposite party-4 (IRDA) and wondered WHY & HOW case was closed by opposite party-1,2,3 & 4 (Oriental Insurance Company & IRDAI) without complainant   knowledge & consent.

 

41. That Thus, again on 07th December 2023, complainant filed a complaint and except their automated acknowledgment mail, complainant didn’t receive any response. ANNEXURE-    

 

42. That as on date 12th January 2024 and till 07th February 2024, there was no response from opposite party-4 (IRDAI) and as per past experience, complainant can’t envisage any kind of development or action being taken. ANNEXURE- SCREENSHOT-12-01-2024-           & ANNEXURE- 07-02-2024-

 

1)  CAUSE OF ACTION & JURISDICTION:

 

A)  AGAINST ORIENTAL INSURANCE COMPANY LIMITED (OICL) & INSURANCE REGULATOR AND DEVELOPMENT AUTHORITY (IRDAI)…………………………………………..(Opposite parties-1,2,3&4)

 

a)    That the cause of action first arose in favour of the complainant and against the opposite parties on August 15, 2022, when the complainant made insurance claims due to the theft of the vehicle by unidentified people and an FIR was lodged against them and

 

b)    That further arose when the situation worsened when the opposing parties failed to respond to the complainant for two and a half months   regarding the appointment of a surveyor. This intentional and deliberate delay in settling the claims occurred in the absence of a survey report and

 

c)     That the further arose when they had not obeyed or adhered to their own insurance policy's terms and conditions. In their insurance policy, they have categorically mentioned only two terms that need to be maintained, which are:

 

A.    Claim for theft of vehicle not payable if theft not reported to Company within 48 hours of its occurrence.

B.    Claim is not admissible if Driving License is found fake or is not valid whether or not in the knowledge of the insured.

 

d)    That the further arose when Several guidelines, orders, directions, notifications, and circulars have been issued by various authorities such as Opposite parties-4 & 5, the Hon'ble Supreme Court, NCDRC, SCDCR, and District forums in cases of theft incidents. In accordance with the guidelines set by the opposite parties-4 &5 IRDAI and GIC, insurance companies should settle claims based on the following four essential documents: a valid driving license, a valid insurance policy, a copy of the FIR, and an untrace report or chargesheet from the police and

 

e)    That the further arose as per in a landmark case, the Hon’ble Supreme Court ruled in "Gurshinder Singh v/s Shriram General Insurance - Civil Appeal No. 653/2020 decided on 24-01-2020" that claims can be settled by obtaining a "Subrogation Certificate" from the customer of a motor vehicle insurance policy. However, the opposite party-1, 2 & 3 failed to disclose this provision and intentionally dragged the complainant to court for settlement, despite repeated requests. The opposing parties 1, 2, and 3 are clearly determined to waste time of hon’ble court and harass the complainant as much as possible. Their intention and service standards are pathetic, which is evident in their unfair trade practices and significant deficiencies in their services. If the opposite party-4&5 had been efficiently and regularly monitored and regulated, the claim settlement could have been closed within days or month. This would have saved the Hon'ble court wasted time and the complainant from harassment.

 

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL No.653 OF 2020 (Arising out of S.L.P.(C) No. 24370 of 2015) GURSHINDER SINGH ....APPELLANT(S) VERSUS SHRIRAM GENERAL INSURANCE CO. LTD. & ANR.. RESPONDENT(S) JUDGMENT B.R. GAVAI, J.

9. Per contra, in the case of Om Prakash (supra), the vehicle was stolen on 23.03.2010 at around 9.00 p.m. The claimant lodged an FIR immediately on 24.03.2010………………………………………………………………………………………………………………….. rejection of the claim on purely technical grounds and in a mechanical manner will result in loss of confidence of policy holders in the insurance industry………………………………….

10. We are of the view that…………………………………………… Before we analyze this case any further, we need to observe the rules of interpretation applicable to a contract of insurance. Generally, an insurance contract is governed by the rules of interpretation applicable to the general contracts. However, due to the specialized nature of contract of insurance, certain rules are tailored to suit insurance contracts. Under the English law, the development of insurance jurisprudence is given credence to Lord Mansfield, who developed the law from its infancy. Without going much into the development of the interpretation rules, we may allude to Justice Neuberger in Arnold v. Britton5, which is simplified as under:

(1) reliance placed in some cases on commercial common sense and surrounding circumstances was not to be invoked to undervalue the importance of the language of the provision which is to be construed.

(2) the less clear the words used were, the more ready the court could properly be to depart from their natural meaning, but that did not justify departing from the natural meaning.

5 [2015] UKSC 36 (3) commercial common sense was not to be invoked retrospectively, so that the mere fact that a contractual arrangement has worked out badly, or even disastrously, for one of the parties was not a reason for departing from the natural language.

(4) a court should be very slow to reject the natural meaning of a provision as correct simply because it appeared to be a very imprudent term for one of the parties to have agreed.

(5) when interpreting a contractual provision, the court could only take into account facts or circumstances which existed at the time that the contract was made and which were known or reasonably available to both parties.

(6) if an event subsequently occurred which was plainly not intended or contemplated by the parties, if it was clear what the parties would have intended, the court would give effect to that intention

 

11. A perusal of the aforesaid shows……………………… consider the application of the rule of contra preferatum, when ambiguity exists and an interpretation of the contract is preferred which favors the party with lesser bargaining power.

 

15. We find, that the second part of Condition No. 1 deals with the ‘theft or criminal act other than the accident’. It provides, that in case of theft or criminal act which may be the subject of a claim under the policy, the insured shall give immediate notice to the police and co−operate with the company in securing the conviction of the offender. The object behind giving immediate notice to the police appears to be that if the police is immediately informed about the theft or any criminal act, the police machinery can be set in motion and steps for recovery of the vehicle could be expedited. In a case of theft, the insurance company or a surveyor would have a limited role. It is the police, who acting on the FIR of the insured, will be required to take immediate steps for tracing and recovering the vehicle. Per contra, the surveyor of the insurance company, at the most, could ascertain the factum regarding the theft of the vehicle.

 

16. It is further to be noted that,………………………….. It is only when the police are not in a position to trace and recover the vehicle and the final report is lodged by the police after the vehicle is not traced, the insured would be in a position to lodge his claim for compensation………………………….......................... The registration of the FIR regarding the theft of the vehicle and the final report of the police after the vehicle is not traced would substantiate the claim of the claimant that the vehicle is stolen. Not only that, but the surveyors appointed by the insurance company are also required to enquire whether the claim of the claimant regarding the theft is genuine or not. If the surveyor appointed by the insurance company, upon inquiry, finds that the claim of theft is genuine then coupled with the immediate registration of the FIR, in our view, would be conclusive proof of the vehicle being stolen.

 

18. We concur with the view taken……………………….it would be taking a hyper technical view. We find, that this Court in Om Prakash (supra) has rightly held 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.

 

20. We, therefore, hold that when an insured has lodged the FIR immediately after the theft of a vehicle occurred and when the police after investigation have lodged a final report after the vehicle was not traced and when the surveyors/investigators appointed by the insurance company have found the claim of the theft to be genuine, then mere delay in intimating the insurance company about the occurrence of the theft cannot be a ground to deny the claim of the insured.

 

22. In the present case, the facts are undisputed. The theft had occurred on 28.10.2010. The FIR was lodged at P.S. Nakodar, Jalandhar, Punjab on the same day i.e. 28.10.2010. The police have admittedly lodged the final report. The investigators appointed by the insurance company have submitted their investigation report on 25.02.2011, finding the claim of the appellant to be genuine………………………………………………………………

……………………………………………………………………………………………………………………………………………………..The order of the District Forum dated 09.05.2012 as maintained by the State Commission vide order dated 26.03.2013 is maintained.

 

f)     That the further arose In Another Cases, Wherein Hon’ble Supreme Court state:- (ASHOK KR vs NEW INDIA ASSURANCE-SUPREME COURT Judgement- 31-jul-2023-484038)

 

12. In the opinion of the Court the aforestated ratio of the judgment clinches the issue involved in the case on hand. In the instant case also, the FIR was lodged immediately on the next day of the occurrence of theft of the vehicle by the complainant. The accused were also arrested and charge-sheeted, however, the vehicle could not be traced out. Of course, it is true that there was a delay of about five months on the part of the complainant in informing and lodging its claim before the Insurance Company, nonetheless, it is pertinent to note that the Insurance Company has not repudiated the claim on the ground that it was not genuine. It has repudiated only on the ground of delay. When the complainant had lodged the FIR immediately after the theft of the vehicle, and when the police after the investigation had arrested the accused and also filed challan before the court concerned, and when the claim of the insured was not found to be not genuine, the Insurance Company could not have repudiated the claim merely on the ground that there was a delay in intimating the Insurance Company about the occurrence of the theft.

 

20. We, therefore, hold that when an insured has lodged the FIR immediately after the theft of a vehicle occurred and when the police after investigation have lodged a final report after the vehicle was not traced and when the surveyors/investigators appointed by the insurance company have found the claim of the theft to be genuine, then mere delay in intimating the insurance company about the occurrence of the theft cannot be a ground to deny the claim of the insured.”

 

g)    That the further arose as per STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB, CHANDIGARH. Consumer Complaint No.171 of 2015 Date of decision: 11.10.2017 Kulwinder Singh Chauhan Versus              1. United India Insurance Company Limited through its General Manager, Head Office (Regd.), 24, Whites Road, Chennai. 2. Divisional Manager, United India Insurance Company Ltd., Divisional Office, Jalandhar Road, Hoshiarpur order by JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT:

 

Contentions of the Parties:

5. It was vehemently argued by the learned counsel for the complainant that the complainant purchased a brand new truck manufactured by  Ashok.Leyland……………………………..………………………………………………………………………………………………………………………………………………………………………………………………………………………………. It was further argued that when the vehicle, carrying the goods, was being taken to Maharashtra, the same was parked in the area of Khalapur on 11.4.2012 from where the said vehicle was stolen. A complaint was lodged on the next day with the police of Police Station-Khalapur, District Raigarh, Maharashtra   immediately………………………………………………………………………………………………………………………………………… It was further argued that the complainant had informed the police immediately on 12.4.2012 and had also submitted another application on 23.4.2012 Ex.C-6 but it was not within the power of the complainant to get the FIR registered. He could only give intimation of theft of the vehicle to the police. There is no mala fide intention on the part of the complainant that he will falsely claim for the vehicle which was a new one. In fact there is no delay on the part of the complainant in informing the police as well as the opposite parties and the financier………………………………………………………………………………………………….………………………………………………………………………………………………………………..It was also not in the control of the complainant to get the untraceable report from the concerned authority. The opposite parties have not got the claim investigated on their level. The complainant has no control over the police. Untraceable report can also be obtained by the opposite parties. It was lastly argued that the complainant had given legal notice for not deciding the insurance claim for three years, which is against the IRDA instructions as well as the general practice of deciding the claims by the Insurance Companies. The claim has been wrongly rejected, vide letter dated 27.2.2015, Ex.C-39, on the ground that the documents are not available and the complainant has not completed the formalities. This action of the opposite parties not only amounts to deficiency in service but also amounts to adoption of unfair trade practice on their part.

 

Consideration of Contentions:

7****

8****

9. Another reason for rejecting the claim is non-submission of untraced report duly signed by the SSP/ACP of the concerned area. A copy of the Panchnama/Certificate dated 10.4.2014 regarding the theft of the vehicle issued by the Police Inspector of PS-Khalapur is annexed as Ex.C-17 in which it has been stated that untraced report had been submitted by the police of PS-Khalapur to the Hon’ble Magistrate First Class, Khalapur to grant summary under class “A”. It is also mentioned that FIR had been registered and till that date the accused had not been found. This Certificate has been duly issued by the Police Inspector, PS-Khalapur. Meaning thereby that till 10.4.2014 the vehicle was not traced. This information was supplied to the opposite parties-Insurance Company…………………………………………………………………………………………………………………………………………………………………………………………………………………….it is beyond the control of the complainant to submit all these documents. Some duty is also cast upon the opposite parties-Insurance Company. They were required to appoint their own Investigator as per the IRDA guidelines and as per the usual practice to investigate the matter but nothing of the sort has been done by the opposite parties-Insurance Company…………………………………………………………………………………………………………………………………………………………………………………………………………………..

The complainant has no control over the action of the police authorities and the delay in investigation and tracing out of the vehicle. If the same was not available in the reasonable time, then the opposite parties must compensate the complainant once he fulfilled the required formalities. Admittedly the complainant had submitted the untraceable report from the Police Inspector of the concerned Police Station Ex.C-17 to the opposite parties. Therefore, the opposite parties-Insurance Company must have confirmed from the concerned Police Station, whether the report is correct or not but the same has also not been denied or rebutted by the Insurance Company.

 

10. In a latest judgment dated 4.10.2017 passed in Civil Appeal No.15611 of 2017 (OM PRAKASH v. RELIANCE GENERAL INSURANCE AND ANR.) in which the truck was stolen and there was delay in giving intimation to the Insurance Company, the Hon’ble Supreme Court while allowing the appeal in para no.11 has observed as under: -

“11. 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. 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 the 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 a beneficial legislation that deserves liberal construction. This laudable object should not be forgotten while considering the claims made under the Act.”

 

 

11. In view of the above, we are of the view that the …………………………………………………the opposite parties have failed to bring on record what efforts they have made to trace out the vehicle and why they could not decide the claim for about three years since the claim was rejected,………………………………

 

12. It is common practice that the Insurance Companies being in dominant position create problems when their turn to pay claims comes. Moreover, in the case in hand, as discussed above, the complainant produced on record the attested copy of the Certificate dated 10.4.2014, Ex.C-10 and a copy of the same was also given to the opposite parties, which clearly indicates that the untraced report has been forwarded to the Judicial Magistrate, A-Class, Khalapur. Thus, it does not lie in the mouth of the opposite parties to say that the complainant had not submitted the relevant document i.e. untraced report. The complainant cannot be held responsible for the delay if the police take time in investigation and untraced report is not accepted by the concerned competent Court.

 

13. In view of this, the evidence on record clearly reveals that the complainant has suffered loss on account of the non-payment of the claim within a reasonable period, which at the most can be 6 months………………………………………..Certainly the complainant is entitled to the IDV of the vehicle along with interest besides punitive damages under Section 14 of the C.P. Act, compensation for mental tension and harassment and litigation expenses.

 

 

h)    That the further arose as opposite parties-1,2,3,4,&5 continuously failed in adhering their own guidelines per the IRDA notification dated: 31st August 2017 in reference : IRDNINT/GDL/MISP/202/08/2017

 

A.   Under CHAPTER Ill Code of Conduct of MISP, Point no.-11 Every MISP shall not: -

(g) interfere in the appointment of surveyors and loss assessors assessment activities;

(k) conduct its business in a manner prejudicial to the interests of the policyholders;

(I) indulge in manipulating the insurance business;

(m) indulge in unfair trade practices;

(n) default in complying with, or acts in contravention of, any requirement of the Act, IRDA Act, 1999 or of any rule or any regulation or order made or any direction issued thereunder;

(o) default in complying with any direction issued or order made, by the Authority;

 

B. CHAPTER IV Obligations of Insurers/ Insurance Intermediaries, point under 14 (f) states that:

(f) The insurer and · its employees and insurance intermediary and its employees shall be governed by the code of conduct as specified in Annexure "2".

 

C. CHAPTER V Motor Insurance Service Provider (MISP)                  

15. Operational issues: The MISP shall ensure that the following minimum conditions are met at all times:

Sub-section-10. Grievances –

        a. The sponsoring entity(ies) and MISP shall have in place a mechanism to address policyholders' grievances.

        b. The grievances of policyholders shall be attended to in the time frame specified by IRDA (Protection of Policyholders Interest) Regulations, 2017.

       c. The grievances registered shall be managed through the Integrated Grievance Management System put in place by the Authority.

 

15. Penalties-

c. A MISP shall be liable for penalty for the acts of omission and commission in violation of these guidelines.

d. Any violation of these guidelines or the directions issued by the Authority in this regard may entail one or more of the following actions on the insurer, insurance intermediary and MISP jointly and severally.

i. Restriction on performance incentive to Managing    Director (MD) / Chief Executive Director (CEO) / Whole-Time Directors (WTD)and Key Management Persons (KMPs);

ii. Removal of Managerial Personnel and / or appointment of Administrator;

iii. Direction to not underwrite new business in case of violation of these Guidelines.

iv. Graded Penal action under section 102 of the Act; v. Any other action as specified in the Act.

 

i)      That the further arose through the Notification issued by Reference: IRDNINT/GDL/MISP/202/08/2017 by Opposite Party-(4&5) dated: 31st August 2017.

 

Code of conduct for sponsoring entity, its                                             employees and MISP (see Guideline 10(n) & 14(f)) - Annexure "2"

7. Conduct in relation to claim by client- Every sponsoring  entity, its employees and MISP shall /

(a) explain to its clients their obligation to notify claims promptly and to disclose all material facts and advise subsequent developments as soon as possible;

(b) request the client to make true, fair, and complete disclosure where it believes that the client has not done so. If further disclosure is not forthcoming it shall consider declining to act further for the client;

(c) give prompt advice to the client of any requirements concerning the claim;

(d) forward any information received from the client regarding a claim or an incident that may give rise to a claim without delay, and in any event within three working days;

(e) advise the client without delay of the insurer's decision or otherwise of a claim; and give all reasonable assistance to the client in pursuing his claim.

8. Conduct in relation to receipt of complaints - Every sponsoring entity, its employees and MISP shall:-

(a) ensure that letters of instruction, policies and renewal documents contain details of complaints handling procedures;

(b) accept complaints either by phone or in writing;

(c) acknowledge a complaint within fourteen days from the receipt of correspondence, advise the member of staff who will be dealing with the complaint and the timetable for dealing with it;

(d) ensure that response letters are sent and inform the complainant of what he may do if he is unhappy with the response;

(e) ensure that complaints are dealt with at a suitably senior level;

(f) have in place a system for recording and monitoring complaints.

9. Conduct in relation to documentation - Every sponsoring entity, its employees and MISP shall:-

(a) ensure that any documents issued comply with all statutory or regulatory requirements from time to time in force;

(e) acknowledge receipt of all monies received in connection with an insurance policy;

(f) ensure that the reply is sent promptly or use its best endeavours to obtain a prompt reply to all correspondence;

 

 

j)      That the further arose According to the guidelines of the Opposite parties-4 & 5 (IRDA & General Insurance Council), Opposite party-1, 2 & 3 were supposed to settle the complainant's claim. However, they intentionally delayed beyond the expected timeline and prolonged the complainant's case unnecessarily. The opposite parties 1, 2, and 3 have failed miserably to adhere to the guidelines set by opposite parties 4 and 5. Additionally, opposite parties 4 and 5 have also failed to effectively implement and monitor these guidelines, leading the opposite parties-1,2&3 to take the complainant for granted without a second thought and

 

k)    That the further arose, these guidelines and rules are ineffective in preventing scams that target common people to buy insurance policies. As a result, individuals are left struggling to get their claims settled through the legal process system. It has been widely observed that they intentionally push customers into court procedures, deliberately prolonging the process for years in order to avoid settling claims. They have the opportunity to keep appealing to higher courts if the orders go against them until it reaches the Hon’ble Supreme Court.

 

l)      That the Interestingly, the opposite parties, 4 and 5, seem oblivious and blindfolded to the ongoing situation that has persisted for decades. Instead of taking action, they have simply assumed the role of publishers, issuing guidelines and rulebooks, resembling the "Three monkeys of Mahatma Gandhi Ji."

 

 

m)  That the Opposite party-(4&5) IRDA and GI Council have failed to respond to any communication written to them, which is quite surprising. Customers feel cheated when they see Opposite Party-(4&5) IRDA promoting their IGMS grievance system but failing to address their concerns. They also cleverly distance themselves from their responsibility by claiming to be mere "facilitators." However, the Opposite party-(4&5) IRDA seems to have forgotten that they are not just facilitators, but regulators. The practices of Opposite party-(4&5) IRDA and GI Council reflect significant deficiencies in services and unfair trade practices within the insurance industry, which ultimately affect Indian consumers.

 

 

 

n)    That the further arose as opposite party-(1,2,3,4&5) FAILED REPEATEDLY to the rules & directions mentioned in their notified own regulations. Following as per the Opposite party-(4&5) INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA,  NOTIFICATION Hyderabad, the 22nd June, 2017 Insurance Regulatory and Development Authority of India (Protection of Policyholders’ Interests) Regulations, 2017, under the point nos.:-

11. MATTERS TO BE STATED IN GENERAL INSURANCE POLICY:

(xiii) the grounds for cancellation of the policy which in the case of a retail policy, for the insurer, can be only on the grounds of             mis – representation, non-disclosure of material facts, fraud or                non-co-operation of the insured

(xvii) details of insurer’s internal grievance redressal mechanism along with address and contact details of Insurance Ombudsman within whose territorial jurisdiction the branch or office of the insurer or the residential address or place of residence of the policyholder is located.

 

15. CLAIM PROCEDURE IN RESPECT OF A GENERAL INSURANCE POLICY

1. An insured or the claimant shall give notice to the insurer of any loss arising under contract of insurance at the earliest or within such extended time as may be allowed by the insurer. On receipt of such a communication, a general insurer shall respond immediately and give clear information to the insured on the procedures that he should follow. In cases where a surveyor has to be appointed for assessing a loss/claim, it shall do so immediately, in any case within 72 hours of the receipt of intimation from the insured. Insurer shall communicate the details of the appointment of surveyor, including the role, duties and responsibilities of the surveyor to the insured by letter, email or any other electronic form immediately after the appointment of the surveyor.

2. The insurer / surveyor shall within 7 days of the claim intimation, inform the insured / claimant of the essential documents and other requirements that the claimant should submit in support of the claim. Where documents are available in public domain or with a public authority, the surveyor/insurer shall obtain them.

3. The surveyor shall start the survey immediately unless there is a contingency that delays immediate survey, in any case within 48 hours of his appointment. Interim report of the physical details of the loss shall be recorded and uploaded/forwarded to the insurer within the shortest time but not later than 15 days from the date of first visit of the surveyor. A copy of the interim report shall be furnished by the insurer to the insured/claimant, if he so desires.

4. Where the insured is unable to furnish all the particulars required by the surveyor or where the surveyor does not receive the full cooperation of the insured, the insurer or the surveyor, as the case may be, shall inform in writing to the insured under information to the insurer about the consequent delay that may result in the assessment of the claim. It shall be the duty equally of the insurer and the surveyor to follow up with the insured for pending information/documents guiding the insured with regard to submissions to be made. The insurer and/or surveyor shall not call for any information/document that is not relevant for the claim.

5. (i) The surveyor shall, subject to sub-regulation 4 above, submit his final report to the insurer within 30 days of his appointment. A copy of the surveyor’s report shall be furnished by the insurer to the insured/claimant, if he so desires. Notwithstanding anything mentioned herein, in case of claims made in respect of commercial and large risks the surveyor shall submit the final report to the insurer within 90 days of his appointment. However, such claims shall be settled by the insurer within 30 days of receipt of final survey report and/or the last relevant and necessary document as the case may be.

(ii) Where special circumstances exist in respect of a claim either due to its special / complicated nature, or due to difficulties associated with replacement/reinstatement, the surveyor shall, seek an extension from insurer for submission of his report. In such an event, the insurer shall give the status to the insured/claimant fortnightly wherever warranted. The insurer may make provisional/ on account payment based on the admitted claim liability.

17. GRIEVANCE REDRESSAL PROCEDURE

1. Every insurer shall have in place proper procedures and effective mechanism to resolve complaints and grievances of policyholders, claimants efficiently and with speed.

2. The Grievance Redressal Procedure as outlined in Annexure - I shall be followed scrupulously by all Insurers.

Annexure - I

Grievance Redressal Procedure

1. A complainant who wishes to make a complaint against insurer, intermediary, insurance intermediary, distribution channel or other regulated entities involved in insurance sales and services shall approach the respective grievance redressal officer of insurer. In case either grievance redressal officer of insurer does not respond or the resolution provided by him is not to the satisfaction of the complainant he may register a complaint in grievance redressal management system of the Authority. The Authority facilitates re-examination of the complaint so as to provide final resolution by insurer.

2. Every insurer shall have in place an effective grievance redressal procedure to address complaints of policyho