State Consumer Disputes Redressal Commission
H D F C Ergo Gene Ins Co Ltd. vs Rahul Kaviya on 18 September, 2020
BEFORE THE CONSUMER DISPUTES REDRESSAL COMMISSION,
GUJARAT STATE AT AHMEDABAD.
Court - 3
APPEAL NO.536 of 2014 Dt: 18/09/2020
1. HDFC Ergo General Insurance Co. Ltd.
206, 2nd Floor, Shopper Plaza- IV,
Opp. BSNL Telephone Exchange,
C. G. Road, Ahmedabad. ...Appellant
Vs.
1. Rahul Kaviya
A-52, Akash Flat, Judges Bunglow Road,
Bodakdev, Ahmedabad.
2. Landmark Insurance Broker Pvt. Ltd.
3rd Floor, Landmark House,
Opp. Gurudwara, SG Highway,
Ahmedabd. ...Respondents
Appearance: Mr. M. J. Parikh, Ld. Advocate for the appellant
Mr. M. V. Patel, Ld. Advocate for the Respondent No.1
Mr. C. R. Kothari, Ld. Advocate for the Respondent No.2
Coram: (Shri S. N. Vakil, Judicial Member)
(Smt. J.Y. Shukla, Member)
Order by Shri S.N. Vakil, Member
1. This appeal is by the Insurance Company.
2. The Complainant Rahul Kaviya - respondent No.1 filed Consumer Complaint No. 172 of 2012 with CDRF, Ahmedabad (Rural) against HDFC Ergo General Insurance Co. Ltd. and Landmark Insurance Broker Pvt. Ltd. that he purchased Honda Car bearing No. GJ 1 HM 4697, insured it with the Opponent No.1- Appellant and renewed it from 12.03.2012 to 10.03.2013 vide policy No. 231120003412902000 for Rs. 5,74,639/-. While returning from factory as Piplaj Road to his residence 1 at Bodakdev due to sudden heavy rain fall and flooding of water on the road the vehicle was struck by motorbike, the car stopped working, got it repaired, from the opponent no.2- authorized repairer of the insurance co. for Rs. 1,17,643/-. The insurance co. informed that the claim cannot be processed nor paid, by its letter dated 12.09.2012 with which no survey report, documents were given, nor paid despite notice dated 16.10.2012. Therefore, for this deficiency claims Rs. 1,17,643/- with 12% interest from 12.09.2012, 25,000/- towards mental pain and 10,000/- towards costs.
3. The defence of the insurance co. vide written version is of denial. M/s. Sap Surveyors Pvt. Ltd., approved loss surveyor, was immediately appointed who inspected the damaged vehicle and assessed liability at Rs. 7,634/- only. It observed that water entered inside the engine components through airfilter, therefore, dismentaling and fitting charges of the engine components as well as cleaning charges to the same is only recommended. However, connecting road and engine block got cracked and damaged which was result of cranking/ rotating of engine. Connect rod and engine block cannot get bend/ cracked due to water. As water entered to the engine and vehicle was stopped, the driver must have tried to crank the engine instead of toe the same to the workshop. There was no external impact either to the vehicle or to the engine from outside. It cannot be impacted merely coming in contact with water and hence damage if any, can be attributed to mechanical failure or trying to run the engine of the vehicle when it was still in contact with water and when 2 a vehicle stops on water logged road, effort to start the vehicle is a well- known source to cause damage to the engine, and therefore obvious course is known to be not to try to start the engine without total cleaning of water from inside the engine and inspection by an expert technician. This damage was not found relevant to the present accident but it is in clear violation of condition No.4. The claim is not payable. The claim is pending for want of documents. There is no deficiency of the insurance company.
4. The Forum CDRF Ahmedabad (Rural) by its judgment and order dated 30.07.2013 allowed the complaint and ordered the insurance company to pay the claim of Rs. 1,17,663/- with 9% interest from dated of 12.09.2007 (? 2012), and 5,000/- towards mental pain and Rs.2,000/- towards costs. It is on the ground that when the car stops in the rain water the driver would normally try to take it out. Even if it is believed that it got damaged while doing so it cannot be said that it was for his negligence because there cannot be intention to further damage it, he might not have knowledge of it that the car could get damaged if tried to restart in the water. The insurance co. repudiated on 12.09.2012 whereas the surveyreport was dated 22.03.2013 which also shows deficiency of the insurance company.
5. Being aggrieved by the same, the Insurance Co. preferred this appeal on the ground that the policy had been issued so also the claim settlement was from its Bombay office the Hon‟ble Forum of Ahmedabad had no 3 jurisdiction. Surveyor‟s report is an important piece of document which cannot be taken lightly unless there is strong evidence to the contrary. The policy condition No.4 reads: „In the event of accident or breakdown ... if the vehicle be driven before the necessary repairs are affected any extension of the damage or any further damage to the vehicle shall be entirely at the insured‟s risk‟. Here the complainant has stated that he had tried to start the engine using external force. It damaged the engine by hydrostatic-lock. That is the loss to engine components was not due to inundation but due to the external force applied to start the engine forcibly. Damage caused to the vehicle was entirely due to the complainant‟s negligence. The policy do not covere the risk of engine, there being no premium paid.
6. Heard Advocate Shri M. J. Parikh, for the HDFC Ergo General Insurance Co. Ltd., Shri M. V. Patel for the Respondent No.1 and Shri C. R. Kothari for the Respondent No.2.
7. The letter of repudiation after first saying that your claim due to inundation is payable for loss as per the policy condition, then proceeds to say to the effect that during inspection of the said vehicle it was conveyed that there is damage to connect rod and piston. The policy condition is: "The insured shall take all reasonable steps to safeguard the vehicle from loss or damage and to maintain it in efficient condition and the company shall have at all times, free and full access to examine the vehicle or any driver or employee of the insured. In the event of any accident or breakdown, the vehicle shall not be left unattended without 4 proper precautions being taken to prevent further damage or loss and if the vehicle be driven before the necessary repairs are affected any extension of the damage or any further damage to the vehicle shall be entirely at the insured‟s risk." Then it repudiates and explain how the engine gets damaged if after it stops in water and then tried to start the engine, the engine would get damaged by hydrostatic-lock. Thus, the loss to the engine components was not due to inundation but due to the mammoth amount of external force applied by the insured to start the engine forcibly. The Insurance Company shall not be liable for extention of the losses.
8. Now in M/s. Reliance General Insurance Co. Ltd. Vs. Dr. Anish Sebastian, 3 (2015) CPJ 644 (NC), the investigation conducted by the insurance co. revealed that the vehicle fell in a gutter full of water due to which the water entered into the engine. The vehicle stopped. It was restarted and run resulting in engine damage. The defence was that it happened due to negligence of the driver, the driver ought not to have restarted the vehicle and run the vehicle without repair, and the damage was a consequential damage and not covered under the perview of the policy. It was held that any normal person, stuck in water and with the water entering the engine of car, would make an attempt to restart the car and drive out of the water. This cannot be termed as „negligence of the driver‟ resulting in „consequential damage‟. Accordingly, the defence was not upheld as was done by the learned Forum and so also would be here.
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9. In Bajaj Alliance General Insurance Co. Ltd. Vs. Prakash Ratilal Bachkanivala, Appeal No. 534 of 2007 of this Commission decided on 20.03.2011, it was in similar case found that the damage to the engine was not by external means or by flood or inundation but by mechanical failure and the policy did not cover internal breakdown. Such is not the issue here.
10. In Nicksnova Motors Pvt. Ltd. Vs. Sushilaben N. Thakkar, Appeal No.486 of 2017 of this commission decided on 29.09.2017, it was held that the „basic own damage‟ does not cover the engine protection, for which add- on cover is required to be taken. The aforesaid letter of the Insurance Co. dated 12.09.2012 while repudiating the claim does not at all speak about engine risk by add-on only, it has not repudiated on the ground of additional cover not having been taken or premium for the same having not been paid. Besides, the policy wording shows last para as 27 for IMT 32 only, thereafter half of the page is blank after para 27, and there are no para as 28 and 29. Endorsement No.33 falls in para 32 and 33, engine gear box protector falls in para-32, but as stated above they are not in continuation after the para-27 of the policy wording and para 31, 32 and 33 are altogether in different fonts and styles. Therefore, this para 32 cannot be held to be any part of the policy wording in the present case, nor can it be pressed in. It was not any ground in the letter of repudiation, nor in the w.v., therefore, the ground need not nor could it be resolved here.
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11. Therefore the reason stated the judgment and order of the Forum cannot be assailed. It is true that letter of repudiation is dated 12.09.2012 whereas the survey report is dated 22.03.2013, but it cannot be said that the survey report was a brought up one. It is for the reason that the letter of repudiation incorporated and explain the known concept of hydrostatic lock to repudiate the claim, which was seen after the estimation by the authorized repairer. Therefore there is no substance in the contention.
12. Certificate Of registration of the vehicle shows month and year of manufacture as February 2007. The retail invoice is for Rs. 1,18,124/-. The Forum has allowed Rs.1,17,663/-. The accident damaging the vehicle was on 03.09.2012. Therefore, rate of depreciation for parts at 40% or so was attracted under the policy so also GR as to the same, the vehicle being above 5 years old then. Therefore the Forum while granting amount of Rs.1,17,663/-, was required to subject it to reduce it by such depreciation and excess also. It would be so, even if there was no issue raised. It is for the reason that granting full amount for the damages irrespective of the month and year of manufacture would be like bypassing GR and also as acting against the policy.
13. The case was allowed to be decided in CDRF and hence contention as to want of jurisdiction does not survive here. The incident was very much within the jurisdiction of the Forum.
14. For the reason stated the appeal deserves to be partly allowed with the modification as aforesaid, for which following final order is passed. 7
FINAL ORDER
i) Appeal No. 536 of 2014 is partly allowed.
ii) The judgment and order dated 30.07.2013 of the CDRF, Ahmedabad (Rural), rendered in CC No.172 of 2012 is modified with order that the Appellant - the Opponent No.1 - The HDFC Ergo General Insurance Co. Ltd. do pay the claimant - respondent No.1 Rs. 1,17,663/- less such amount as is to be reduced by any applicable percentage of depreciation under the policy and the excess amount of Rs.1,000/-, together with interest 9% from the date of complaint 12.09.2012 till realization Rs.5,000/- towards mental pain and Rs. 2,000/- towards costs.
iii) No order as to costs.
iv) Registry is directed to pay the deposited amount, with accrued interest, if any, on proper verification to the appellant by account payee cheque and the cheque be handed over to the advocate for the appellant after obtaining receipt.
Pronounced in the open Court today on ____ day of September, 2020.
(J.Y.Shukla) (S.N.Vakil)
Member Member
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