Insurance company cannot deny claim on ground of delay in intimation of theft: Supreme Court

The Supreme Court recently reiterated that an insurance company cannot repudiate a claim merely on the ground of delay in intimation of theft of an insured vehicle [Jaina Construction Company v. Oriental Insurance Company Limited and Another]..A Division Bench of Justices Sanjiv Khanna and Bela M Trivedi held,"When the complainant had lodged the FIR immediately after the theft of the vehicle, and when the police after the investigation had arrested the accused and also filed challan before the concerned Court, and when the claim of the insured was not found to be not genuine, the Insurance Company could not have repudiated the claim merely on the ground that there was a delay in intimating the Insurance Company about the occurrence of the theft," the Court ruled..The Bench was hearing an appeal against a 2016 order of the National Consumer Disputes Redressal Commission (NCDRC) that had allowed the insurance company to deny a claim to the appellant on the ground of the said delay..The truck of the appellant was insured by the respondent insurance company. On November 4, 2007, the truck was stolen by some miscreants. The next day, a First Information Report (FIR) was registered on the appellant's complaint. The police later arrested the accused, but could not trace the stolen vehicle. It filed an untraceable report on August 23, 2008.The appellant then lodged a claim with the insurance company about the vehicle in question. However, the insurance company failed to settle the claim within a reasonable time. Aggrieved, the appellant moved the District Consumer Disputes Redressal Forum. During the pendency of the complaint, the insurance company repudiated the claim of the insured on the mere ground of delay in informing it of the accidental loss or damage.However, the district forum allowed the claim of the appellant. This prompted the insurance company to move the State Consumer Disputes Redressal Forum, which dismissed the same. On appeal, the NCDRC allowed the plea of the insurance company, leading to the present appeal before the Supreme Court..The top court in the present case relied on its 2020 decision in Gurshinder Singh v. Shriram General Insurance Company Limited and Another, where it was held that when an insured has lodged the FIR immediately after the theft of a vehicle and when the police after investigation have lodged a final report, then mere delay in intimating the insurance company about the occurrence of the theft cannot be a ground to deny the claim of the insured..Advocate-on-Record Kamakshi S Mehlwal, Advocates Avinash Lakhanpal, Dhiraj Kumar, Ram Kripal Singh, Sanveer Mehlwal, Geetanjali Mehlwal and Piyush Lakhanpal appeared on behalf of appellant..[Read Judgment]