Updated: July 7, 2019 11:12:40 am
The State Consumer Disputes Redressal Commission directed an insurance company to pay Rs 30.91 lakh to the company owned by father of former Punjab Cabinet Minister Bikram Singh Majithia after their Porsche car’s accident claim was rejected.
In the judgment released on July 4, the Commission had directed the National Insurance Company to pay an amount of Rs 27,86,026 (loss assessed by the surveyor) to the complainant with an interest at 12 per cent per annum (simple) on the amount and Rs 55,000 as litigation charges. the commission directed the insurance firm to pay Rs 2.50 lakh to the company as the car is still lying in the workshop, denying its use, by the complainant or Managing Director.
The complaint was filed by a company named Saraya Industries through its Joint Director Gurmeher Singh Majithia. As per the complaint, the Porsche 911 Carrera S car was purchased by the company for Rs 80 lakh on July 26, 2017, and was insured with National Insurance Company Limited for Rs 1.13 lakh and the Insured Declared Value of the car was Rs 64.80 lakh. It was alleged that on February 4, 2018, when the Managing Director of the company Satyajit Singh Majithia, father of Bikram Singh Majithia, drove the vehicle and met with an accident. The intimation in this regard was given to the insurance firm.
Advocate DS Sobti, counsel for the complainant argued that on February 9, 2018 a declaration was made that no one was injured in the accident and no police report or FIR was lodged, whereas the dealer of the car, inspected the vehicle and made accident service quotation for Rs 32,84,212, as the engine of the vehicle suffered damage and needed replacement. However, the insurance company kept dilly dallying the matter. Finally, the complainant had to approach the the commission on September 12, 2018.
The insurance firm in reply submitted that the complainant met with an accident on February 4, 2018 but intimation was given 5 days later and it violated condition of the policy. After the accident, the damaged vehicle was taken to the workshop on February 10, and estimate was given for Rs 32,84,212, and the surveyor report was received on March 13. The insurance company submitted that the vehicle is imported and the engine has to be brought from foreign country, the engine protection add on cover is not applicable for imported vehicle and if the vehicle would have been imported one, the insurance company shall not be liable to make any payment in respect of delay of more than 72 hours, in delivering the insured vehicle to the workshop from the time of occurrence of accidental damage or loss. Since the vehicle was delivered to the workshop after six days from the date of occurrence of accident, there is breach of policy condition.
The commission bench, cited a judgment titled as “R.Amudha Vs. The Manager, UTI Bank, Madurai and others, 2013 SCC Online Mad 1517”, in which the Madras High Court said that “when the claim is found to be genuine mere delay in intimation cannot be the ground to reject the claim and further held that law of limitation cannot be resorted to deny the legitimate rights of parties and further directed the respondent therein to disburse the amount of the insurance policy within two weeks.” The commission thus opined that the delay is not very huge and even after the accident, 4-5 days are required to intimate the insurance company.
Regarding the argument of insurance company that the engine protection add on cover is not applicable for imported vehicles, the Commission held that the plea is not sustainable in the eyes of law because at the time of issuance of policy, heavy premium in the sum of Rs 1.13 lakh was received by the insurance company for the car along with engine.
“…The insurer is aware of the fact that Porchue car is of international make, therefore, it is the duty of the insurance company not to accept the premium at the first instance. It appears that the insurance company has taken a solemn wow not to reimburse any claim whatsoever. Moreover, it is clearly written in Annexure C-5 i.e. cover note of the insurance policy “Deep Cap + Consumables + Engine Protection Rs.1,13,000/-…”, read the judgment.
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