Case Study 14: DINESH CHANDRA MODY V/S UNITED INDIA INS.CO. LTD.

The insured had purchased a Tata sumo for Rs. 5.6 lakhs inclusive of accessories etc. and the insurer insured the vehicle for the same amount. The complainant’s vehicle was stolen after 4 months of purchase in the policy period and the formalities of F.I.R. with the local police and intimating the insurer were complied with by the insured. The vehicle was untraceable and insurer offered Rs. 4 lakhs to the insured which was not acceptable to him and hence he filed the complaint. The surveyor of the insurer recommended a sum of Rs. 5.25 lakhs taking into account the short duration within which the vehicle was stolen. The insurer relying upon the judgment of national commission contended that it was not obligatory on the insurer to accept the recommendation as made by surveyor/investigator and hence didn’t agree to offer Rs. 5.25 lakhs. There was no evidence available to rebut the case of the complainant about the perfect and sound condition of the vehicle at the time of the theft.
The court observed that the stand of the insurer was not justified by any evidence in support of the condition of the vehicle. The said aspect depends upon various factors such as:

• Condition of vehicle.
• Time lag between purchase and theft.
• Duration of period of use.
• Other such factors.

HELD: Insurer to pay sum of Rs.5.25 lakhs along with interest @7.5% p.a.