District Consumer Disputes Redressal Commission Coimbatore Holds IFFCO TOKIO Liable For Rejecting Personal Accident Claim Over Non-Transfer Of Insurance Policy

The District Consumer Disputes Redressal Commission, Coimbatore, comprising President R. Thangavel and Member P. Marimuthu, has held IFFCO TOKIO General Insurance Co. Ltd. liable for deficiency in service for repudiating a compulsory personal accident claim solely on the ground that the insurance policy had not been formally transferred to the name of the deceased vehicle owner, even though the vehicle's registration had already been transferred and the policy remained valid on the date of the accident. Facts The complainants, D. Muruganandam and M. Sumathi, approached the Consumer Commission seeking payment of ₹15 lakh under the compulsory personal accident cover available under a two-wheeler insurance policy following the death of their son, M. Shanmugam, in a self-accident on November 12, 2024. Shanmugam had purchased the motorcycle from its previous owner, Lakshmi, and had successfully transferred the vehicle's registration certificate to his own name. However, before the insurance policy could be endorsed in his favour, he died in the accident. Although the vehicle was covered by a valid comprehensive insurance policy issued by IFFCO TOKIO, the insurer refused to process the claim solely because the policy continued to stand in the name of the previous owner. Despite the complainants submitting the registration certificate, insurance policy, death certificate, legal heir certificate and other supporting documents, the insurer neither settled the claim nor responded to their legal notice. Alleging deficiency in service and unfair trade practice, the complainants approached the Commission seeking settlement of the insurance claim along with compensation and litigation costs. Contentions of the Insurer IFFCO TOKIO contended that the contract of insurance is personal in nature and based on the principle of utmost good faith. It argued that since the transfer of ownership had not been intimated and the insurance policy had not been endorsed in favour of the deceased, there was no privity of contract or insurable interest between the deceased and the insurer. The insurer further submitted that under the policy conditions governing compulsory personal accident cover, the benefit was payable only if the owner-driver was the registered owner, the insured named in the policy and possessed a valid driving licence. Accordingly, it maintained that the repudiation of the claim was justified. Observations & Decision The Commission observed that it was undisputed that the registration certificate had already been transferred to the deceased's name, the insurance policy remained valid on the date of the accident, and IFFCO TOKIO had repudiated the claim solely because the insurance policy had not been formally transferred in favour of the deceased. Referring to Section 157 of the Motor Vehicles Act, 1988, the Commission examined the legal position in light of the Supreme Court's decisions in Complete Insulations (P) Ltd. v. New India Assurance Co. Ltd. and Balwant Singh and Sons v. National Insurance Co. Ltd. Thereafter, relying on the Kerala High Court's decision in N.J. Joseph v. National Insurance Company Ltd., the Commission observed that compulsory personal accident cover has evolved into a statutory social security measure that travels with the policy upon transfer of ownership. The Commission further held that mere delay or omission in formally endorsing the insurance policy does not defeat such statutory coverage unless the insurer establishes actual prejudice or breach of a specific policy condition. Since IFFCO TOKIO had failed to establish either, the Commission held that the deceased had effectively stepped into the shoes of the insured despite the absence of a formal endorsement. Consequently, the repudiation of the claim amounted to deficiency in service. Accordingly, the Commission partly allowed the complaint and directed IFFCO TOKIO General Insurance Co. Ltd. to pay ₹15 lakh under the compulsory personal accident cover, ₹5,000 as compensation for mental agony and ₹5,000 towards litigation costs. The Commission further directed that the amounts be paid within one month from the date of receipt of the order, failing which they would carry interest at the rate of 9% per annum until realization. Case Title: D. Muruganandam & Anr. v. The Authorised Officer, IFFCO TOKIO General Insurance Co. Ltd. Case No.: Consumer Complaint No. 92 of 2026 (C.C. No. 92/2026) Appearance: For the Complainants: Thiru R. Ashok and others, Advocates. For the Opposite Party: Thiru P. Sashi Kumar, Advocate. Click Here To Read/Download Order

District Consumer Disputes Redressal Commission Coimbatore Holds IFFCO TOKIO Liable For Rejecting Personal Accident Claim Over Non-Transfer Of Insurance Policy

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District Consumer Disputes Redressal Commission Coimbatore Holds IFFCO TOKIO Liable For Rejecting Personal Accident Claim Over Non-Transfer Of Insurance Policy

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