Delhi Consumer Commission Directs United India Insurance To Pay ₹38,000 For Stolen Motorcycle Despite 59-Day Delay

Allowing a complaint against United India Insurance Company Ltd., the Commission held that mere delay in intimating the insurer about a vehicle theft cannot justify repudiation where the FIR has been lodged in time and the claim is otherwise genuine.

Facts

The complaint was filed by Rohit Choursiya, challenging United India Insurance Company Ltd.'s repudiation of his claim for a stolen motorcycle bearing registration number DL-04-SCH-4871.

The motorcycle was insured with the company for the period from March 8, 2016, to March 7, 2017. It was stolen from outside the complainant's house on October 24, 2016. An FIR was lodged with the jurisdictional police station, and the complainant subsequently approached the insurer to claim the insurance amount.

The insurance company rejected the claim through a letter dated February 10, 2017, citing a 59-day delay in intimating it about the theft. The complainant had informed the insurer about the incident on December 23, 2016.

The complaint was initially filed before the District Consumer Disputes Redressal Commission, North-West District, Delhi, and was later transferred to the North District Commission pursuant to an order of the Delhi State Commission.

Contentions Of The Parties

The insurance company contended that the delay in intimation constituted a breach of the policy's terms and conditions. It relied on the National Consumer Disputes Redressal Commission's decision in New India Assurance Co. Ltd. v. Trilochan Jane, which had treated even a nine-day delay in reporting a vehicle theft to the insurer as a ground for repudiating the claim.

The insurer argued that the decision in Trilochan Jane was the prevailing legal position when it repudiated the claim and, therefore, its action did not amount to a deficiency in service.

Commission's Observations

The Commission noted inconsistencies in the complainant's explanations for the delay in informing the insurer about the theft. Even if the explanation regarding the loss of the insurance policy and issuance of a duplicate copy was accepted, the complainant had not explained why he waited from November 10 to December 23, 2016, to intimate the insurer.

Referring to the Supreme Court's decisions in Om Prakash v. Reliance General Insurance (2017) and Gurshinder Singh v. Shriram General Insurance Co. Ltd. (2020), the Commission held that mere delay in informing the insurer about a vehicle theft cannot justify repudiation where the FIR has been lodged in time.

The Commission also relied on Directorate of Revenue Intelligence v. Raj Kumar Arora [2025 INSC 498] to hold that these principles would apply retrospectively to the repudiation dated February 10, 2017, despite the insurer's reliance on New India Assurance Co. Ltd. v. Trilochan Jane.

Examining the surveyor's report, the Commission noted that the insurer had filed only its first four pages. The available portion indicated that the claim was otherwise genuine, referring to verification of the FIR, confirmation from the investigating officer, collection of both original vehicle keys, and intimation to the RTO. Finding no adverse findings regarding the claim's genuineness, the Commission held that the claim had to be accepted and paid.

Decision

Allowing the complaint, the Commission directed United India Insurance Company Ltd. to accept the claim and pay the motorcycle's insured declared value of ₹38,000, with interest at 6% per annum from March 13, 2018, the date of filing of the complaint.

The insurer was also directed to pay ₹5,000 towards compensation and litigation expenses, with both payments to be made within four weeks of receiving the order.

The Commission further clarified that if the insurer failed to comply within the stipulated period, the entire amount payable upon expiry of the four weeks would carry interest at 9% per annum until actual payment.