Non-Settlement of Insurance Claim Solely Because Original Certificate Of Registration Of Stolen Vehicle Is Not Produced Amounts To Deficiency In Service.
The Supreme Court in a recent judgement affirmed the view that Insurance companies refusing claims on flimsy/technical grounds must stop and should not ask for documents that are beyond the control of the insured to furnish.
In the recent case of Gurmel Singh v. National Insurance Co. Ltd. decided on 20th May 2022, where an Insurance Company had refused to settle an insurance claim on non-submission of the duplicate certified copy of certificate of registration of the stolen vehicle, the bench of MR Shah and BV Nagarathna, JJ held that while settling the claims, the insurance company should not be too technical and ask for the documents, which the insured is not in a position to produce due to circumstances beyond his control.
The brief facts of the case are that a Truck was stolen and on the same day of the theft an FIR was also registered. The Insured informed the Insurance Company about the theft and filed the claim, however, the insurance company failed to settle the claim, Later, the insured approached the District Consumer Disputes Redressal Commission which disposed of the complaint stating that the insured has to furnish a certified copy of the certification of registration of the truck to the insured company within a month. The appellant could not produce either the original certificate of registration or the duplicate certified copy of the certificate of registration of the Truck. When the appellant applied for the duplicate certified copy of the certificate of registration, the RTO denied issuing the duplicate on the ground that given the information/report regarding the theft of the vehicle, which has been registered with the RTO, the details regarding registration certificate on the computer has been locked. The District Commission dismissed the said complaint by observing that as he had not filed the relevant documents for settlement of claim therefore, non-settlement of the claim cannot be said to be deficiency of service.
The said order was challenged before the Apex Court, where it was observed that, “The insurance company has become too technical while settling the claim and has acted arbitrarily. The appellant has been asked to furnish the documents which were beyond the control of the appellant to procure and furnish. Once, there was a valid insurance on payment of huge sum by way of premium and the Truck was stolen, the insurance company ought not to have become too technical and ought not to have refused to settle the claim on non-submission of the duplicate certified copy of certificate of registration, which the appellant could not produce due to the circumstances beyond his control.
