Inordinate delay by an insurer in assessing loss and communicating settlement options constitutes a deficiency in service. The quantum of loss is determined by the surveyor's report, and Constructive Total Loss is only applicable if repair costs exceed 75% of the Insured's Declared Value (IDV).

ORDER

KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION VAZHUTHACAUD, THIRUVANANTHAPURAM

APPEAL No.619/2017

ORDER DATED : 03.02.2026

(Against the order in C.C.No.966/2014 on the files of DCDRC, Ernakulam)

PRESENT:

HON’BLE JUSTICE SRI. B. SUDHEENDRA KUMAR : PRESIDENT

SRI. AJITH KUMAR D. : JUDICIAL MEMBER

SRI. K.R. RADHAKRISHNAN : MEMBER

APPELLANT:

M/s National Insurance Co. Ltd., Divisional Office, P.B.No.6, First Floor, Santhi Park, Kolancherry – 682 311 represented by its Senior Divisional Manager

(by Adv. Prasanna Kumar Nair)

Vs.

RESPONDENT:

Satheesh, S/o Ramakrishnan V.K., Vallikkudiyil House, Murampathi P.O., Kodancherryviz Kozhikode – 673 001

(by Adv. T.J. Lakshmanan)

ORDER

SRI. K.R. RADHAKRISHNAN : MEMBER

This is an appeal filed under Section 15 of the Consumer Protection Act, 1986 by the opposite party in C.C.No.966/2014 on the files of the District Consumer Disputes Redressal Commission, Ernakulam (for short, ‘the District Commission’). As per the order dated 03.05.2017, the District Commission partly allowed the complaint and directed the opposite party to pay Rs.1,98,583/-(Rupees One Lakh Ninety Eight Thousand Five Hundred and Eighty Three only) towards settlement amount of the claim with 12% interest per annum from the date of claim i.e., from 10.09.2012. They were further directed to pay Rs.99,000/-(Rupees Ninety Nine Thousand only) towards compensation for the mental agony and inconvenience suffered by the complainant and also Rs.10,000/-(Rupees Ten Thousand only) as costs. The opposite party challenges the said order.

2. The brief details of the complaint are as follows:

The complainant is the registered owner of Hyundai Santro car bearing registration No.KL 57 B 5344. The vehicle was insured with the opposite party insurer vide policy No.570802/31/11/6100011382 for the period from 30.11.2011 to 29.11.2012 for an Insured’s Declared Value (IDV) for Rs.2,52,000/-(Rupees Two Lakhs Fifty Two Thousand only). The vehicle met with an accident near Muvattupuzha on 08.07.2012 causing severe damages to the insured vehicle. The vehicle was entrusted with M/s Popular Hyundai, Muvattupuzha for repairs. The claim was submitted to the insurer, who deputed an independent surveyor for assessing the loss. Initially, the sureveyor informed the complainant that the settlement of the claim can be made for an amount of Rs.1,60,000/-(Rupees One Lakh Sixty Thousand only) on total loss basis. However, the complainant was not ready to accept the amount as the IDV of the vehicle was Rs.2,52,000/-(Rupees Two Lakhs Fifty Two Thousand only). On 10.11.2014 the opposite party insurer informed the complainant that the claim can be settled for Rs.1 lakh, less policy excess, on cash loss basis. According to the complainant he is entitled to get the IDV shown in the insurance policy, as per Total Loss basis mode of claim settlement. But without considering the policy conditions, the insurance company arbitrarily arrived at an amount of Rs.1,00,000/-(Rupees One Lakh only) towards the settlement of the claim. Thereafter, they communicated to the complainant vide letter dated 16.01.2015 that the claim will be closed as “no claim” if consent letter for cash loss settlement is not given within 15 days. It was not acceptable to the complainant. There was an inordinate delay of two years on the part of the insurance company in intimating about the settlement of the claim and therefore, there was deficiency in service on the part of the opposite party. Hence, the complainant filed this complaint cl