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MAHARASHTRA STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, BOMBAY
Hon’ble Mr. Justice G.G. Loney, President;
Shri M.G. Gavai, Member
ANAND MANOHAR PARCHURE—Complainant
versus
NATIONAL INSURANCE CO. LTD. & ANR.—Opposite Parties
Complaint No. 149/91 — Decided on 14.1.1992
An insurance company is deficient in its service if it delays the settlement of a claim and undervalues it. The complainant is entitled to compensation for the delay and interest on the full value of the insured vehicle.
Headnote:
CONSUMER PROTECTION - INSURANCE - DELAY IN SETTLEMENT OF CLAIM - UNDER-VALUATION OF CLAIM - DEFICIENCY IN SERVICE - COMPENSATION - INTEREST - DAMAGES - LOSS OF PRICE RISE - INSURANCE ACT, 1938 - SECTIONS 2(12A), 3, 4, 64UM, 64V.
Fact of the Case:
The complainant, an advocate, purchased a Maruti Van and insured it with the opposite party, National Insurance Company Ltd. The vehicle was stolen, and the complainant lodged a claim with the insurance company. The insurance company delayed the settlement of the claim and undervalued it, settling it for Rs. 70,000/- instead of the insured value of Rs. 80,000/-.
Finding of the Court:
The court found that the insurance company was deficient in its service by delaying the settlement of the claim and undervaluing it. The court also found that the complainant was entitled to compensation for the delay and interest on the full value of the insured vehicle.
Issues: 1. Whether there was deficiency in the service of the insurance company? 2. Whether the complainant was entitled to claim compensation due to the negligence in the service of the insurance company?
Ratio Decidendi: The court held that the insurance company was deficient in its service by delaying the settlement of the claim and undervaluing it. The court also held that the complainant was entitled to compensation for the delay and interest on the full value of the insured vehicle.
Final Decision: The court directed the insurance company to pay the complainant Rs. 10,000/- towards the balance amount of the insured vehicle and Rs. 6,000/- as interest, along with Rs. 500/- as costs.
Mr. Justice G.G. Loney, President—The complainant filed this consumer dispute alleging the deficiency in the service of National Insurance Company Ltd. as regards the delay in settlement of insurance claim and for under-valuing the claim.
2. Shortly stated, the facts are that the complainant is a practising Advocate at Nagpur and had purchased on 17.12.87 a New Maruti Van for Rs. 81,358.82ps. Its original registered number was MIK-6969 and later on it was changed to MZV-8989 when it was registered at Nagpur. The Complainant had insured the said motor vehicle with the opposite party under an insurance policy on 11.12.90 for the period between 17.12.90 to 16.12.91. The value for purposes of insurance has been shown at Rs. 80,000/- in the insurance policy. The said motor vehicle was stolen on 24.1.91 from the High Court premises, Nagpur. The Complainant reported the matter to the Police immediately and Crime No. 45/91 was registered u/Sec. 379 of the IP.C. The complainant also notified the theft of his motor vehicle in newspapers. On 25.3.91, the complainant lodged the claim with the opposite party for settlement of his claim. According to complainant despite his repeated attempts to settle the claim earlier, the opposite party delayed the settlement of his claim and finally settled it on 16.8.91 for Rs. 70,000/- only. In his complaint, the complainant claimed the full value of the motor vehicle, interest, damages and resultant less. Thus, Rs. 1,63,600/- are claimed on account of the deficiency in the service of the opposite party.
3. The claim of complainant was opposed by the opposite party by filing written version on 20.9.91. The opposite party denied the claim of complainant on both the grounds of delay and under valuation. Hence, there arose a consumer dispute in this complaint.
4. The complaint was fixed for final hearing on 19.11.9 at Nagpur Camp. Although the notice of hearing was served, the opposite party remained absent and, therefore, we proceeded ex-parte against it. The complainant had sent his agent and sought an adjournment and, therefore, the complaint was fixed for filing the affidavit by the complainant on 20.11.91. At the time of final hearing on 20.11.91, the complainant was heard in person. Although the opposite party was proceeded ex-parte on the previous date of hearing, we heard the arguments of Shri Somalwar learned Advocate for opposite party. The complainant in support of his allegations and claim filed an affidavit dated 12.11.91 besides the necessary documents of insurance policy and letters of correspondence. The opposite party did not file any affidavit. After filing of this complaint, it seems that the opposite party settled the claim of complainant on 16.8.91 for Rs. 70,000/-. The complainant accepted that amount of Rs.70,000/- on 10.8.91 under protest. The complainant filed an application for amendment before this Commission on 10.9.91 and stated that his claim for the balance amount survives and be decided by this Commission.
5. In view of the denial of the complainant’s claim by the opposite party, the following points arise for our consideration.
(i) Whether there is deficiency in the service of the opposite party?
(ii) Whether the complainant is entitled to claim the compensation due to the negligence in the service of the opposite party?
The complainant has given the details as regards the efforts he made for the delayed settlement of his claim. On 25.3.91, the complainant lodged the claim. At that time, he was told by opposite party No. 1 to wait for three months. After about 1½ months period on 7.5.91, the complainant was asked to file certain documents which he supplied on 13.5.91 to the Surveyor. It is seen that the surveyor, one Shri Copade appointed by the opposite party made frivolous enquires from the complainant. The motor vehicle in question is a Maruti Van, yet the Surveyor questioned as to why it was registered as ‘light motor vehicle car’. The Surveyor exhibited his total ign
