Skip to main content

Motor insurance

TRANSFER formalities at the regional transport office on purchase/sale of vehicles can take time. While the process is pending, the insurance policy continues in the name of the seller. What happens if the vehicle meets with an accident or is stolen during this period? If the buyer lodges a claim, the insurer refuses to indemnify him as the policy is not in his name. If the seller lodges the claim on behalf of the buyer, the insurer contends once the vehicle is sold, he ceases to have an insurable interest, and, hence, is not entitled to lodge aclaim. Thus, though the premium has been collected, the claim is paid neither to the seller nor the buyer. Is this permissible? Narayan Singh purchased asecond-hand Maruti van, insured for `1,40,000 by the original owner. Within five days, it met with an accident while Singh and his family were travelling from Varanasi to Muzaffarpur. The vehicle was totally damaged. As the claim was not settled, Singh filed a complaint before the Muzaffarpur District Forum, which ruled in his favour and directed the company to reimburse 1,40,000 with an eight-per cent interest per annum, plus `5,000 as compensation and cost.

The insurer appealed to the Bihar State Commission, which set aside the forum's order and dismissed the complaint, stating the Muzaffarpur District Forum did not have the territorial jurisdiction and, also, because the policy had not been transferred in Singh's favour.

Singh then approached the National Commission. With regard to policy transfer, the commission said the view taken by the State Commission was erroneous and could not be justified in view of Section 157 of the Motor Vehicles Act, which provides that an application for transfer has to be made within 14 days of the vehicle's purchase. In this case, the accident had occurred within five days, much before the expiry of this period. Also, India Motor Tariff Regulations say that upon a vehicle's transfer, the benefits under the policy would automatically accrue to the new owner. So, the rejection was unjustified.

Regarding the objection to the territorial jurisdiction of the Muzaffarpur District Forum, the commission observed that Singh resided at Muzaffarpur and was using the vehicle there. Even as the accident took place in Patna district, the insurance company had a branch at Muzaffarpur. Hence, the commission ruled the Muzaffarpur District Forum could entertain the dispute.

Accordingly, it set aside the State Commission's order and upheld the decision given by the District Forum in Singh's favour. It also increased the rate of interest from 8 to 12 per cent a year.

The commission came down heavily on the insurance company for adopting an unjustified stand and suppressing the relevant India Motor Tariff Regulation in several cases. As a deterrent and penal measure, it levied a punitive cost of `1lakh on the insurer, payable to the Consumer Legal Aid Account. The commission warned insurers to be careful about not taking a stand contrary to the regulations framed by the India Motor Tariff and the Insurance Regulatory Development Authority. The order copy was also sent to the latter's chairman . [Shri Narayan Singh v/s New India Assurance – IV (2007) CPJ 289 (NC)].

Some companies continue rejecting similar claims. Recently, a consumer complaint was filed against Bajaj Allianz General Insurance for ignoring such a claim, despite the judgement having been brought to its notice
 

Popular posts from this blog

ICICI Pru Mutual Fund Dividend

ICICI Prudential Mutual Fund has announced dividend under the following schemes: Scheme Dividend ( Rs /unit) ICICI Pru Capital Protection Oriented Ser V Plan B-D 0.03611325 ICICI Pru Capital Protection Oriented Ser V Plan B Direct-D 0.03611325 ICICI Pru Balanced Advantage Direct-DM 0.06 The record date has been fixed as February 08, 2017. ------------------------------ ------ Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds Top 4 Tax Saver Mutual Funds for 2017 - 2018 Best 4 ELSS Mutual Funds to invest in India for 2017 1. DSP BlackRock Tax Saver Fund 2. Invesco India Tax Plan 3. Tata India Tax Savings Fund 4. BNP Paribas Long Term Equity Fund Invest in Best Performing 2017 Tax Saver Mutual Funds Online Invest Best Tax Saver Mutual Funds Online Download Top Tax Saver Mutual Funds  Application Forms For further information contact  SaveTaxGetRich on 94 8300 8300 ------------------------------ ------ Leave y...
Read more

What is Financial Freedom?

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India)     There were many things common between our Freedom fighters. All had the Single vision (Free India), common goal (independence) and had a disciplined and focused approach. They were ready to do anything and everything and had made so many sacrifices to see India free . But the road to freedom was not easy .They had faced lot many hardships, went to jail so many times and even confronted physical and mental torture from the British. There was one more thing which proved to be an advantage to our fighters that most of them were professional lawyers. The knowledge of legal issues and its impact on our country at large has helped them counter various bills and proposed new laws by the then government. It is due to their continuous effort that we are able to achieve the goal of Independent Indi...
Read more

Hidden Bank Fees

  What Banks Hide From Customers Imagine after a peaceful and exciting holiday you receive your bank statement with steep charges. You then rush to your bank and start confronting staff members and to your dismay, you come to know that the high end debit card was charged very heavily. Wouldn't this cause damage to your finances? So remember, the world outside is full of deceptive and double cheating people. Unethical practices are always used by company sales person in order to meet the target. Credit card companies, mutual funds and bank institutions always play dirty tricks to lure customers and the practices are rampant. So here's how you should be careful while dealing with your banks: High End Debit Card Charges While opening an account with a bank you opt for a debit card with minimal charges. But later on when you upgrade your card and opt for high end debit card the annual charge rise by a good amount. Though such a card has slew of features but it all comes at a high ...
Read more

Partial withdrawal from PPF

  Public Provident Fund (PPF) account has a lock in period   If you opened a PPF account to meet your retirement needs,, think twice about withdrawing from this fund before retirement. But provided it's an emergency here are the rules. Public Provident Fund (PPF) account has a lock in period before which you cannot withdraw your money.   The partial withdrawal is allowed after the completion of 6 financial years . This means that you will be allowed a partial withdrawal from 1 April 2017. The maximum partial withdrawal allowed is the least of the following: 50 percent of the account balance at the end of fourth financial year, 31 March 15 50 percent of the account balance of the end of previous financial year, 31 March 17.   There's a loan option available on your PPF account between the fourth and the sixth financial year. You can obtain a loan of up to 25 per cent of the balance in your account. However, this will attract interest of 2 percent more than the prevailing ...
Read more

Updating a minor PAN card upon becoming adults

  Updating a minor's PAN card once they become adults A PAN card issued in the name of a minor does not contain the minor's photograph or signature, and therefore, cannot be used as a valid proof of identity. Once a minor PAN card holder turns 18, the relevant changes must be made in the PAN records. A new card is then issued bearing a photograph and signature. Application The applicant is required to fill up the "Request for new PAN card andor changes or correction in PAN data" form. The form can be filled up online by accessing NSDL's Tax Information Network website and clicking on the online PAN application tab. Information The applicant must mention the existing PAN number in the application and check the `photo mismatch' and `signature mismatch' boxes, and submit the online form. The form must also be printed out, signed by the applicant, and submitted along with two photographs. Documents Identity and address proof in the form of a copy of the app...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now