Insurance Company denied Claim as Individual Left Key in Car when the Car got stolen, Now NCDRC rules in favor of Individual
The National Consumer Disputes Redressal Commission (NCDRC), presided over by AVM J. Rajendra, has ruled that an insurer cannot deny a legitimate claim unless the alleged violation constitutes a fundamental breach of the insurance policy. The decision came in a case involving Bharti Axa General Insurance and a policyholder whose vehicle was stolen.
Background of the Case
The complainant had insured their vehicle with Bharti Axa General Insurance. When the vehicle was stolen, the complainant promptly filed a First Information Report (FIR) and informed the insurer, providing all required documents and the vehicle’s key. However, the insurer rejected the claim, prompting the complainant to file a case with the District Consumer Forum.
The District Forum ruled in favor of the complainant, ordering the insurer to pay ₹7,07,513 along with 9% interest. The insurer appealed the decision before the State Commission of Rajasthan, which upheld the District Forum’s ruling. Unwilling to accept the verdict, the insurer filed a revision petition with the NCDRC.
Insurer’s Argument
The insurer admitted the validity of the policy but argued that their investigation revealed negligence on the complainant’s part. They claimed the vehicle was left unattended, unsecured, and with the key in the ignition at the time of the theft, which they asserted violated the terms of the policy. The insurer maintained that this breach justified rejecting the claim and sought dismissal of the complaint.
National Commission’s Findings
The NCDRC examined whether leaving the key in the ignition constituted a fundamental breach of the insurance policy. While the insurer cited Condition No. 4 of the policy to justify the rejection, the Commission noted that the theft occurred quickly after the vehicle was left unattended. It questioned whether this act created a “special risk” for theft.
The Commission referred to a previous case, David Topp vs. London Country Bus (1993), which held that leaving a key in a vehicle does not automatically increase the risk of theft. While the complainant’s carelessness was acknowledged, the Commission ruled that it did not amount to a fundamental breach of the policy.
Final Decision
The NCDRC dismissed the insurer’s revision petition, upholding the decisions of the District Forum and the State Commission. The insurer was directed to pay 75% of the insured amount to the complainant.