Repudiation of claim by insurance company on the ground of failure of written intimation of theft of vehicle, held proper

National Consumer Disputes Redressal Commission (NCDRC):  NCDRC has held that failure of the insured to give immediate information of theft in writing to the insurance company would entitle the insurance company to repudiate the claim. While observing this, NCDRC upheld the repudiation of insurance claim by Reliance General Insurance Co. in a case of theft of vehicle.

Earlier, the complainant purchased an insurance policy for his vehicle from Reliance General Insurance Co. for the sum insured Rs. 5, 41,000/-. The policy was valid with effect from 06.11.2009 to 05.11.2010. According to the complainant, the vehicle was stolen by some unknown person from Loco Road, Bholepur on 11.08.2010. The theft was reported to the police station Kotwali on the same day. Oral information of theft was given to the Insurance Company. As the vehicle could not be traced, the complainant filed an insurance claim before the Insurance Company Reliance. Said claim was repudiated on the ground that in violation of the terms and conditions of the insurance policy, the complainant had failed to give immediate intimation of theft in writing to the insurance company.

When the complainant approached the  District Forum, it allowed the complaint and directed the Insurance Company to pay the amount of insurance claim of the insured vehicle i.e. Rs. 5,41,000/- with interest to the complainant. An appeal against the order was filed by the Insurance Company before the State Commission, which was dismissed. Aggrieved by the order, Insurance Company filed a revision petition before NCDRC.

After perusing the documents and hearing the parties, NCDRC observed that, “it is the case of the complainant that he reported the theft of subject vehicle to the concerned Police Station on the same day and gave oral information of theft to the petitioner insurance company. It is not the case of the complainant that he gave immediate intimation of theft of vehicle in writing to the insurance company.” After perusal of material on record and hearing the parties, NCDRC relied upon the earlier judgments of the National Commission and decided in favour of the insurance company. “As the insured has failed to fulfil his obligation to intimate the theft of vehicle to the insurer in writing immediately after the theft, insurance company was justified in repudiating the insurance claim,” noted the Commission while allowing the revision petition. [Reliance General Insurance Co. Ltd. v. Arun Kumar Singh, 2017 SCC OnLine NCDRC 1, decided on January 3, 2017]

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