Kullu District Commission Holds New India Assurance Co. Liable For Wrongful Repudiation Of Genuine Claim

Brief Facts:

The Complainant was the registered owner of a 'Maruti Alto K10', which was insured with New India Assurance Co. Ltd. (“Insurance Company”). On September 21, 2020, the vehicle was involved in an accident when a cow suddenly appeared in front of it. Consequently, the vehicle veered off the road and was extensively damaged. The accident was reported to the police, and an FIR was lodged at the Police Station, Kullu. The Complainant also submitted a claim along with all relevant documents with the Insurance Company. However, the Insurance Company repudiated the claim. Feeling aggrieved, the Complainant filed a consumer complaint in the District Consumer Disputes Redressal Commission, Kullu, Himachal Pradesh (“District Commission”).

In response, the Insurance Company argued that there was no deficiency in service and that the Complainant had suppressed material facts. The vehicle was insured, and a claim was made, but claimed that the Complainant had misrepresented the accident details. According to the FIR, the accident was due to the driver's rash and negligent driving. However, the Complainant stated that the vehicle skidded while trying to avoid the cow. The Insurance Company also argued that the injuries reported did not match the accident's circumstances, suggesting misrepresentation and concealment by the Complainant.

Observations of the Commission:

The District Commission observed that the FIR did not provide detailed information and was filed by a third party who was not directly involved in the accident. The FIR, being a document based on the informant's perception, was not a substantive piece of evidence against the Complainant's claim. Furthermore, the police final report and the driving license of the driver corroborated the Complainant's version of events.

The report from the surveyor appointed by the Insurance Company assessed the vehicle's IDV at Rs. 2,29,110/-, but the surveyor's assessment was slightly lower at Rs. 2,04,500/-. After accounting for the excess clause and salvage value, the final settlement amount was determined to be Rs. 1,78,500/-.

Given these considerations, the District Commission held that the repudiation of the Complainant's claim was not legally justified. Therefore, the Insurance Company was directed to pay Rs. 1,78,500/- to the Complainant, along with interest at 6% per annum from the date of filing the complaint. Additionally, the Insurance Company was ordered to pay Rs. 25,000/- in damages for mental harassment and Rs. 5,000/- for litigation costs.

Case Title: Chhering Dolma vs The New India Assurance Co. Ltd.

Case No.: Complaint No. 14/2022

Advocate for the Complainant: DG Negi

Advocate for the Opposite Party: RK Thakur

Date of Pronouncement: 24^th July 2024