The main legal point established in the judgment is the importance of providing an opportunity for the insured to explain alleged breaches before finalizing a repudiation letter, and the principle of settling claims on a non-standard basis in the case of total loss.

ORDER :

Narendra Kawde, Member

The org. opponent-Bajaj Allianz General Insurance Company Ltd. (‘Insurance Company’ in short) has filed this appeal challenging the order dated 30.6.2011 passed by District Forum, Nashik in consumer complaint No. 282/2010, Mukund Triambak Kapre v. Bajaj Allianz General Insurance Company Ltd. District Forum while deciding consumer complaint allowed the same partly and directed appellant/Insurance Company to pay an amount of Rs. 5,20,000 together with interest @ 12% p.a. with ancillary relief of Rs. 15,000 towards mental agony and Rs. 1,000 towards cost of litigation. All these amounts were directed to be paid within a period of 30 days from the date of order.

2. Aggrieved with the impugned order, this appeal has been filed by the Insurance Company on the ground that insured vehicle was used for commercial purpose though insurance cover was provided as ‘Private Car Package Policy’. Therefore, question of covering risk does not arise as ex facie the vehicle was used for hire. Claim was intimated by original complainant belatedly after about a month though F.I.R. was lodged with the concerned Police Station on the same date. This is an additional breach of condition as claim was not submitted in time. Even after filing the written arguments by the appellant, learned District Forum allowed the delay condonation application though vehemently opposed by the appellant. The insured vehicle was hypothecated to the ICICI Bank. There is no material/documentary evidence whatsoever to support the case of total loss as claimed by the complainant. District Forum erred while deciding the consumer complaint in favour of complainant without going through the legal provisions as no insurance cover whatsoever was provided for ill-fated vehicle on account of ‘hire and reward’ for which vehicle was used contrary to the conditions of cover under the Policy.

3. We heard Mr. S.R. Singh, learned Advocate for the appellant and Mr. A.S. Vidyarthi, learned Advocate i/b Mr. Vijay Gawande, Advocate for the respondent. Perused the record.

4. Facts which are not in dispute are that the incident of accident to the insured vehicle is not in dispute so also the F.I.R. lodged on the very day of accident is also not in dispute. What is disputed is that the claim preferred by the complainant belatedly though the accident was occurred on 9.12.2007 whereas the complainant preferred claim on 4.1.2008. District Forum appreciated the Survey Report on record which is not filed in the appeal compilation by the appellant. Vehicle was insured as Private Use and therefore, there were limitation as to use. Insured Declared Value is Rs. 5,20,000 with sitting capacity of 10 passengers. There is no documentary evidence whatsoever led by the appellant/Insurance Company before the District Forum to establish that the ill-fated vehicle was used for the purpose of hire and reward. Appellant/Insurance Company relied only on the statement of one Smt. Pannashree Venkateshwarrao Sagi, which was recorded by the Police at the time of filing F.I.R. Claim preferred on 4.1.2008 was repudiated by the Insurance Company firstly on the ground of violation of terms and conditions as to limitation to use and second ground was that of delayed intimation of filing insurance claim.

5. Interestingly, on going through the repudiation letter, it cannot be construed as repudiation letter in strict sense as the Insurance Company after citing violation of the conditions in Para 1 of said letter inquired with the complainant stating, “Kindly explain why we should pay the claim?” However, the last line in the said letter says, “In the above your claim stands repudiated accordingly same may please be noted and no any communication should be entertained regarding the same.” On one hand the Insurance Company conveyed by said alleged repudiation letter the violation of terms and conditions of the Policy and on the other hand called for explanation from the complainant as to why they shoul