In a significant legal ruling, the court has highlighted the importance of considering the circumstances and reasons behind the submission of documents in insurance claim settlements. Emphasizing that insurance companies should not become overly technical when settling claims, the judgment serves as a reminder of consumer rights and fair practices. Dive into the insightful legal analysis of this landmark decision.
Facts
- The appellant’s vehicle was insured with the respondent insurance company from 22.08.2012 to 21.08.2013.
- The appellant paid Rs. 28,880 as premium to the insurance company.
- The vehicle was stolen on 23-24.03.2013.
- The appellant informed the insurance company and RTO about the theft.
- District Consumer Disputes Redressal Commission directed the appellant to provide duplicate certified copy of the registration certificate to the insurance company for claim settlement.
- Appellant complied with the direction but claim was not settled.
- District Commission dismissed the complaint citing lack of relevant documents.
- The order was upheld by the State Commission and National Consumer Disputes Redressal Commission.
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Analysis
- Appellant informed insurance company and RTO about the theft of the Truck on the same day.
- Appellant paid Rs. 28,880/- towards premium but could not produce original or duplicate certificate of registration.
- FIR was registered on the day of theft.
- RTO denied duplicate certificate due to locked details on computer after theft report.
- Appellant tried to obtain duplicate certificate but was unable to do so.
- Insurance claim not settled due to lack of original certificate of registration.
- Appellant provided photocopy of registration certificate and RTO details.
- Insurance company must have received a copy of the certificate of registration during policy issuance.
- Insurance company’s denial of claim based on lack of original certificate is deemed a deficiency in service.
- Insurance company’s technical and arbitrary behavior criticized in claim settlement.
- Insurance companies should not become too technical when settling claims.
- Refusing claims on flimsy or technical grounds is not acceptable.
- Insured individuals may not always be able to produce certain documents due to circumstances beyond their control.
- Judicial bodies should consider the circumstances and reasons behind the submission of documents before dismissing claims.
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Decision
- The appellant is entitled to the insurance amount of Rs. 12 lakhs along with interest @ 7 per cent from the date of submitting the claim.
- The respondent – insurance company is liable to pay the litigation cost of Rs. 25,000/- to the appellant.
- The present appeal is allowed, and the original complaint is also allowed.
- The insurance company must pay the amount to the appellant within four weeks from today.
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Case Title: GURMEL SINGH Vs. BRANCH MANAGER, NATIONAL INSURANCE CO. LTD. (2022 INSC 619)
Case Number: C.A. No.-004071-004071 / 2022
