Insurer denies man’s vehicle theft claim over registration number change, to now pay Rs 4.9 lakh

“As per our view, the registration number of the vehicle was changed from commercial to private vehicle, and the change of registration number of the vehicle does not impact the claim,” the May 29 order read. 

The commission observed that the complainant was the registered owner of the vehicle on the date of the accident and hence, was entitled to the claimed amount of policy. 

A stolen recovery van claim dismissed by company 

The complainant claimed that he is the registered owner of a vehicle recovery van which was changed from a certain registration number as per the government policy. The said vehicle was insured with the insurance company concerned. It was submitted that said vehicle was being run by the driver of the complainant and was parked in front of the office of Khushi Crane Service, in Rohtak.

The complainant claimed that the said vehicle was unfortunately stolen by some unknown person on May 15, 2019, and on the next morning when the said driver came to the office, he found the vehicle missing. 

Accordingly, the said driver lodged an FIR on May 16, 2019, concerning this theft. The complainant stated that he submitted all the documents to the insurance company and his claim was registered, but the same was rejected by a letter dated November 18, 2019. 

The complainant allegedly approached the insurance company to enquire about the reason for rejection, upon which he was told that the claim would be cleared after completing some formalities. 

Later, the insurance company rejected the claim, having two objections. The first objection was regarding the sale of the vehicle, and the second objection was regarding the number of the vehicle number. 

Aggrieved by the same, the man moved the commission alleging that the said act and conduct of the insurance company of rejecting the claim of the complainant was illegal and arbitrary. The complainant was represented by advocate Vikas Pruth.  

‘Complainant was owner on date of incident’

• The commission held that the claim has been wrongly repudiated by the insurance company and the complainant is entitled to the assured sum of the vehicle, Rs 4,80,000.
• The consumer body directed the insurance company to pay Rs 5000 as compensation on account of deficiency in service and Rs 5000 as litigation costs.

HDFC Insurance’s defence 

The insurance company was represented by advocate R K Bhardwaj, who pointed out that the complainant had no insurable interest in the vehicle. It was submitted that the registration number as well as use of the said vehicle has been changed from commercial to private, and changing the nature of the said vehicle without intimation to the insurance company was a violation of the terms and conditions of the insurance policy. 

It is further submitted that said driver gave a statement to the investigator that he had purchased the van from the complainant for Rs 5.85 lakh. It was also contended that the said driver had parked the alleged vehicle at night on the road without supervision of anyone, which was a violation of the terms and conditions of the policy. 

It was further contended that at the time of theft, the said driver was the owner and in possession of the said vehicle. It was emphasised that, however, the name in the registration certificate was not changed because the vehicle in question was on loan. 

Significance of ruling

This ruling underscores that an insurer cannot repudiate a theft claim merely because the registration number of a vehicle has been changed pursuant to government policy. 

For consumer-related grievances, individuals may contact the consumer helpline in their respective states (Chandigarh contact: 0172-2700183) or call the National Consumer Helpline at 1915 for assistance.