Insured cannot be penalised for breach by insurance agent – Bharati Axa General directed to pay Private car claim

Case of : Mr. Nitinbhai M Vekaria V/s Bharti AXA General Insurance Co.Ltd. Complaint No. AHD-G-007-1617-1338 Policy No. FPV/I2137489/71/02/003251

Insurance Ombudsman Date of award : 21/03/2017

The Complainant had purchased a “Private Car – Comprehensive Insurance policy from Bharti AXA General Insurance Company Ltd. The vehicle bearing No. GJ-03-ER-0005 had met with an accident on 26/08/2016. Intimation was given to Insurance Company on 27/08/2016. Based on the Surveyor’s Report and the policy terms and conditions, the Respondent had rejected the claim citing misrepresentation and suppression of material facts. The complainant stated that on 26/08/2016, his car (Toyota Innova)had met with an accident. He had intimated the insurance company on 27/08/2016 and thereafter lodged a claim of Rs.6,30,400/- (IDV), being total loss of the vehicle.Complainant stated that before the renewal date of policy, he came to know that the premium was Rs.17,801/-. At the time of renewal he had not signed any proposal form. He handed over the cheque, copy of previous policy and R.C. book to the agent. He had received the policy document after two months of renewal date. His car met with an accident after 6 months of the renewal of  policy.He had lodged the claim of his car which was repudiated by the Insurance Company stating that he had suppressed the material fact. He added that he did not know about NCB, at the time of renewal he had not signed any papers and agent had not enquired with him about NCB. His claim was wrongly rejected on basis of non-disclosure of material fact (NCB) he had made a complaint to the Insurer for the same but they never replied.The claim had been rejected on wrong basis. Hence, he pleaded for settlement of his claim.  The representative of the Respondent stated that as per survey report of M/s Infinium Motor Pvt. Ltd, Ahmedabad, the assessed loss Rs.2,78,400/- was on net of salvage basis. During document verification, it was noticed that while seeking Insurance for the subject risk, the complainant had declared that he had not made any claim in the previous policy and he was eligible for NCB upon expiry of the previous policy. The respondent had produced copy of e-mail Re: NCB Confirmation (from previous insurer – Liberty Videocon General Insurance Co.Ltd.) wherein it was mentioned that one claim was reported; loss date 10/05/2015 and payment date was 25/05/2015 for Rs.21,371/-under policy No.40020114100871900000.In reply to a question, whether the insurance company had enquired with previous insurer prior to issuance of subject policy, about any claim, the representative replied that they had inquired through mail on 20/03/2017 and got reply that the policy number was incorrect. Also they have confirmed from the portal that there was NO CLAIM for said vehicle hence they had issued the subject policy.At the time of claim, they had again inquired with the previous insurer, and they got a confirmation that the claimant had lodged a claim which was settled on 25/05/2015 for Rs.21,371/-.Wrong declaration of NCB amounts to misrepresentation and breach of condition mentioned in the declaration clause of the Proposal Form.Thus, as per the provisions of Motor Insurance provided by Insurance Regulator, the insured was not eligible for any NCB in the present insurance policy. It was apparent that the above material fact was not brought to their notice while seeking insurance policy. As the complainant was aware that the concealment of material facts render the contract void and as such the company had no liability under the insurance policy issued to the complainant. The complainant stated that at the time of renewal of the insurance policy, he had not signed any proposal form. His signature on the cheque was verified with the signature on the proposal form. The signatures differed.Previously his car was insured with M/s Liberty Videocon General Insurance Co.Ltd.Before issuance of the subject policy, the insurer had inquired with previous insurer and as per portal there was NO CLAIM, and they had issued the policy with benefit of 20% NCB (Rs.4,214=85)At the time of subject claim, the insurer had again inquired with previous insurer and received a confirmation mail. From the e-mail of M/s Liberty Videocon General Insurance, it was established that the claimant had lodged a claim and payment of Rs.21,371/- was received by him on 25/05/2015.Had the insured declared the NCB, he would had required to pay Rs.4,214=85 more.The insured had handed over a signed cheque for Rs.17,801/- as renewal premium. The premium in the previous policy was Rs.19,641/-. As there was no much difference, the insured had not suspected the change in the insurer. The agent had filled up the insurance proposal and had allegedly signed it ( but definitely not the complainant). The insurer, despite the insured’s complaint on forged signature had not carried any enquiry with its agent. The insurer had failed to take necessary timely action. The complainant had no grudge against the previous insurer and did not have any other reason to shift his insurance to another company.Unfortunately, the insurer’s attempt to find the history of claim with previous insurer too had not yielded the truth.The insured’s mistake was to hand over a blank cheque to the agent and even after receipt of the policy had not raised any issue with the insurer on it being a different company.The complaint was admitted. In view of the facts and circumstances, the Respondent’s is directed to pay 50% of IDV Rs.3,15,200/- to the complainant. The salvage shall be kept by the insurer.

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