Mere Smell Of Alcohol Insufficient To Prove Driver's Negligence, Palakkad District Commission Holds Insurance Company Liable

Brief Facts:

Shanavas K V (“Complainant”), lodged a complaint against The National Insurance Co. Ltd. (“Insurance Company”), regarding the repudiation of his claim for damages to his insured vehicle. The incident occurred while the complainant's vehicle, covered by a valid insurance policy, was driven by his brother (“driver”) and suffered a fall in a low-lying property. The insurance company rejected the claim on the grounds of delay in reporting the accident and alleging that the driver was under the influence of alcohol. Aggrieved, the complainant filed a case before the District Consumer Disputes Redressal Commission, Palakkad (“District Commission”).

The complainant contended that his vehicle was under a valid policy when the accident happened, and the rejection of the claim was unjustified. He argued against the allegations of delay and alcohol influence.

The insurance company admitted the complainant's version but argued that the driver had violated policy terms which clearly go against driving under the influence of alcohol and that there was a significant delay in claim filing. Reliance was placed on the communication from the Superintendent, DH, Palakkad, to the Senior Divisional Manager in which it is stated that smell of alcohol was recorded from the driver, while driving the vehicle.

Observations of the Commission:

The first ground concerned the alleged influence of alcohol on the Complainant during the accident. The District Commission noted that while there was evidence indicating the presence of alcohol, the critical aspect was whether the driver was operating the vehicle "under the influence" of alcohol. Therefore, it noted that the mere presence of the smell of alcohol is not sufficient to conclusively establish that the driver was operating the vehicle under the influence of alcohol at the time of the accident. It was underscored that the lack of evidence establishing impaired driving due to alcohol consumption was a crucial factor in this assessment.

Moving on, the second ground for repudiation pertained to the delay of more than 10 days in notifying the insurance company about the accident. The District Commission delved into this aspect and observed that the delay had not obstructed the insurance company's ability to assess the loss. Extensive investigations conducted prior to repudiation suggested that the delay did not substantially impact the assessment process.

Consequently, the District Commission concluded that there was a clear deficiency in service on the part of the insurance company. The repudiation of the claim was deemed unjustified, given the inadequacy of evidence to support the reasons provided. Furthermore, the District Commission highlighted that the insurance company's reliance on the delay in intimation was an afterthought, as they could have rejected the claim sooner if the delay was truly critical.

With regard to the relief for the complainant, the District Commission ordered the insurance company to indemnify the complainant with admissible amounts, overlooking the repudiation grounds. This sum was to accrue interest at a rate of 10% from the date of the claim until the date of payment. In addition, the complainant was granted costs for the legal proceedings.

Case: Shanavas K.V. vs The National Insurance Co. Ltd.

Case No.: CC/165/2017

Advocate for the Complainant: Adv. K. Balasubramanian

Advocate for the Respondent: Adv. P.K. Devadas

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