Uttarakhand State Commission Holds National Insurance Liable For Deficiency In Service Over Denial Of Legitimate Claim Amount

Brief Facts of the Case

The complainant purchased a vehicle insured with National Insurance/insurer. The policy covered Rs. 4,50,000, and the premium was paid. The insurer assured payment in case of accident or theft. Subsequently, the vehicle was stolen, and the complainant informed the insurer immediately through its agent. In January 2014, the complainant provided all required documents, but no claim payment was made. Later, the insurer proposed an amount of Rs. 3,07,250, which the complainant disputed as incorrect. Despite sending a notice and a legal notice, the insurer did not pay the Rs. 4,50,000 claim. The complainant filed a complaint before the District Commission, which allowed the complaint. It directed the insurer to pay Rs. 4,50,000 with 6% interest and Rs. 5,000 as litigation costs. Consequently, the insurer appealed before the State Commission of Uttarakhand.

Contentions of the Insurer

The insurer argued that the complainant breached policy terms and did not intimate the theft promptly. According to the insurer, the information was intimated to the insurer after 25 days of the said incident. The insurer denied all allegations of deficiency in service and argued that the insured is not entitled to receive more than the proposed amount.

Observations by the State Commission

The State Commission observed that the complaint was filed beyond the prescribed limitation period. The insurer argued that the theft occurred, and the complaint was submitted late without a proper delay condonation application. However, the complainant contended that the insurer was promptly informed about the theft and was later issued a legal notice. The complainant asserted that the cause of action arose when the insurer declined to pay the claim amount. The Commission further noted that the insurer did not dispute the theft, and the police report corroborated the incident. Based on the evidence and facts presented by both parties, the District Commission determined the case appropriately and within its jurisdiction. No irregularities or legal errors were found in the judgment. Consequently, the appeal was dismissed, and the District Commission's decision was upheld.

Case Title: National Insurance Co. Ltd. Vs. Sh. Sachin Tyagi

Case Number: F.A. No. 09/2019

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