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Imagine losing your brand new vehicle on the very day of purchase. That’s exactly what happened to Sanjeev Kumar. And as if that was not bad enough, he had to wage a long legal battle with the insurance company for indemnification of his loss. Well, if the vehicle was not even a day old and was stolen, why shouldn’t the consumer get back the full insured amount? After all, that is the very purpose of the insurance. You and I may think that way, but the insurance company does not. It will make every attempt to see if it can somehow either reject the claim or pay much less than the insured amount. On the ground that the vehicle was not yet registered, the insurance company offered him only 75 per cent of the insured amount. On July 25, 2004, Sanjeev Kumar bought a brand new Mahendra Max for Rs 4,11,797 from United automobiles, Allahabad. He also took an insurance policy from United India Insurance, from the date of purchase, that is, July 25, 2004 to July 24, 2005. Since the dealer told him that the moment the vehicle leaves the show room, its value gets reduced by 5 per cent, he took the insurance cover for Rs 3,89,473. Since Kumar lived in Buxar, he drove the vehicle to Buxar and parked it in front of his house. Since it was a Sunday, he had to take it for registration the next day to the Regional Transport Office in Buxar. The next morning however, to his utter shock and dismay, he found his vehicle missing. He lodged a complaint with the police and eventually, filed a claim with the insurance company. After eight months, the insurance company offered as "full and final" settlement, Rs 2,91,000. This came as a second shock to Kumar. How could he accept such a reduced sum for a brand new vehicle? He had to repay the loan that he had taken from a bank to purchase the vehicle. Kumar filed a complaint before the District Consumer Disputes Redressal Forum, Buxar, which directed the insurance company to pay the full insured amount along with 12 per cent interest and also pay a compensation of Rs 1 lakh. The Bihar State Consumer Disputes Redressal Commission before which the insurance company filed an appeal, however set aside this order. It’s verdict was that since the vehicle was not registered with the Regional Transport Officer, the insurance company was justified in offering settlement of the claim on a ‘non-standard’ basis. Appalled by this, the consumer filed a revision petition before the National Consumer Disputes Redressal Commission, which, fortunately for the consumer, set aside the order of the State Commission. It asked the insurance company to pay the entire insured amount of Rs 3,89,473, along with 12 per cent interest calculated three months after the loss of the vehicle. It also awarded Rs 25,000 as costs. The national commission pointed out that under Section 40 of the Motor Vehicles Act, every owner of the motor vehicle is required to get it registered by a registering authority in whose jurisdiction he is residing or the place of business where the vehicle is normally kept. In the present case, the complainant said that he was a resident of Buxar and, therefore, after purchasing the vehicle he took it to that city. He could not get his vehicle registered as it was Sunday and the RTO office was closed. He kept it during the night time at his residence from where the theft took place. Further, with regard to obtaining temporary registration also it was not possible for the complainant to get it registered because it was not a working day for the offices of RTO. In these set of circumstances, the offer made by the insurance company was not justified, the commission said. The commission further stated "The petitioner (consumer) has also pointed out that as per the terms of the insurance policy, there is no violation of any term. It is true that under the Motor Vehicles Act, using the vehicle without registration is a punishable offence, but at the same time, in the present case, the complainant has not used the vehicle in the ordinary course but has only brought it to his residence and on the same day the vehicle was stolen. Therefore, the insurance company ought to have settled the claim on the basis of the sum insured."
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