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IN THE HIGH COURT OF KERALA AT ERNAKULAM
SATHISH NINAN, P.KRISHNA KUMAR
New India Assurance Co. Ltd. – Appellant
Versus
Federal Bank Ltd. – Respondent
JUDGMENT :
Sathish Ninan, J.
The suit for money by a Bank, under a Banker's Indemnity Policy of the defendant Insurance Company, was decreed by the trial court. The Insurance Company is in appeal.
2. Ext.A2 is the base insurance policy with its addition/extension, availed by the plaintiff from the defendant insurance company. It relates to the period 01.04.2012 to 31.03.2013. The plaintiff alleges that, during the period from 11.04.2012 to 20.05.2012 there were various fraudulent transactions in the plaintiff's ATMs across the country, by fraudsters, by utilising ATM cards of other banks. The plaintiff describes the modus operandi of the transactions thus;
“The modus operandi of such transactions is for the fraudster who may be the customer of other banks request for a cash withdrawal for an amount of Rs.10,000/- or less from the ATM centre of the plaintiff bank using the ATM cards of the banks mentioned above. When the ATM dispenses the requested amount, the fraudster will keep one or two currency notes in the presenter intentionally and take the rest of the amount. For the purpose of illustration, in the case of a withdrawal of Rs.10,000/-, the fraudster may take only Rs.9,900/- allo
Fraudulent ATM transactions were excluded from coverage under the Banker's Indemnity Policy, emphasizing the interpretation of ambiguous insurance contract terms in favor of the insured.
1) Fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and good faith forbids either party from non-disclosure of the facts which the parties kno....
1) Well settled that since upon issuance of an insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the policy, its terms have to be s....
Exclusion clauses in insurance contracts are binding unless proven unconscionable or contrary to public policy, reaffirming the validity of such clauses in commercial contracts.
Policy coverage provisions should be interpreted broadly regarding tripartite agreement along with the terms of the policy and exclusion clause must be read narrowly.
(1) Trading Loss - Trading loss means loss sustained during trade.(2) Exclusion Clause - loss attributable to business and trading loss of the assured, including non-recovery of trade debts & indirec....
When insurance policy itself defines acts of terrorism in Exclusion Clause, terms of policy being a concluded contract will govern rights and liabilities of parties – Parties cannot rely upon definit....
Insurance policy – Exclusion clause – Burden of proof is on the insurer to show that case falls within the purview of exclusion clause – In case of ambiguity, benefit goes to insured.
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