top of page

Mere delay in intimating the insurance company about the occurrence of the theft cannot be a ground

Gurshinder Singh vs. Shriram General Insurance Co. Ltd. & Anr., Civil Appeal No. 653 of 2020 Arising out of S.L.P. (C ) No. 24370 of 2015 – January 24, 2020.

The Supreme Court Bench comprising of Justice N.V. Ramana, Justice R. Subhash Reddy and Justice B.R. Gavai pronounced the following judgment.

Issue: Whether delay in informing the occurrence of theft of the vehicle to the insurance company, though the FIR was registered immediately, would disentitle the claimant of the insurance claim?

Facts: Appellant bought an insured tractor from the respondent. The tractor was stolen and a FIR was lodged on the same day. The claim was submitted to the respondents after 2 months. It was rejected on the ground that it was submitted after 52 days. The appellant approached the District Forum and the complaint was allowed and directed the respondents to pay the insured amount. The respondents preferred an appeal in the State Commission and it was dismissed. A Revision Petition is filed in the National Commission. On relying upon the judgment of New India Insurance Co. Ltd. Vs. Trilochan Jane allowed the revision petition. Appeal is made in the Supreme Court.

The court considered on the fact that delay in informing the insurance company will not debar the insured to get the insurance claim as the FIR was lodged on the same day of theft. Condition No.1 of the Standard Form of Commercial Vehicles Package Policy was referred. The condition regarding the delay shall not be a shelter to repudiate the insurance claims which have been otherwise proved to be genuine.

The respondents argued that the insurer and the insurance company is bound in the terms and conditions of the insurance policy. It is also contended that any theft or accidental loss or damage must be immediately informed to the insurance company in the form of writing.

The Court stated that the term ‘co­operate’ as used under the contract needs to be assessed in facts and circumstances. While assessing the ‘duty to co­operate’ for the insured, inter alia the Court should have   regards   to   those   breaches   by   the   insured   which   are prejudicial to the insurance company. Usually, mere delay in informing the theft to the insurer, when the same was already informed to the law enforcement authorities, cannot amount to a breach of ‘duty to co­operate’ of the insured. The Court relied upon Om Prakash  vs. Reliance General Insurance & Anr. and held that  mere delay in intimating the insurance company about the theft of the vehicle should not be a shelter to repudiate the insurance claim which has been otherwise proved to be genuine. And the Consumer Protection Act aims at protecting the interest of the consumers and it being a beneficial legislation deserves pragmatic construction.

The Bench observed that the registration of FIR regarding the theft and the final report of the police after the vehicle is not traced would substantiate the claim of the claimant that the vehicle is stolen. Therefore, the Court held that mere delay in informing the company about the theft is not a ground to deny the claim of the insured. The appeal is allowed and the order of the National Commission is quashed and set aside.

–  Vydurya Selvi Baskaran



bottom of page