Policy Holder Willing To Accept Claim Under Protest, Failure To Make Payment By Insurance Co., Thrissur Commission Holds Oriental Insurance Liable

Brief Facts:

The Complainant insured his vehicle with Oriental Insurance Co. Ltd. (“Insurance Company”). The vehicle was used to fulfil his means of livelihood. During the subsistence of the policy, the vehicle met an accident and was repaired with an expenditure of Rs. 1,64,500/-. After incurring the expenses, the Complainant filed a claim with the Insurance Company. The Insurance Company only reimbursed Rs. 52,500/-, as opposed to Rs. 1,64,500/-. The Complainant was given a discharge voucher of Rs. 52,500/-, which he accepted under protest. The Complainant signed the voucher and wrote 'cheque received with protest' on it. Allegedly, the Insurance Company took offence to the Complainant's endorsement of the protest and refused to even pay Rs. 52,500/-, as earlier promised.

Subsequently, the Complainant sent a legal notice to the Insurance Company. However, he did not receive any reply. Feeling aggrieved, the Complainant filed a consumer complaint before the District Consumer Disputes Redressal Commission, Thrissur (“District Commission”). In response, the Insurance Company contended that it intended to issue the sum of Rs. 52,500/- on the basis of the surveyor's report. However, the same was not issued because the Complainant endorsed the claim by writing 'with protest' on the discharge voucher. The Insurance Company also submitted that it requested the Complainant multiple times to give a 'clean discharge voucher'. However, the same was not given.

Observations by the District Commission:

At the outset, the District Commission held that although the Complainant had claimed to expend a sum of Rs. 1,64,500/- on the repairs, he failed to present any evidence to substantiate the same. Regarding the Complainant's endorsement of the claim 'with protest', the District Commission referred to the decision of the Supreme Court in Kaushal Kishor vs State of Uttar Pradesh (2023), wherein it was held that every citizen has the fundamental right to freedom of speech and expression under Article 19(1)(a) of the Indian Constitution and such freedom includes the right to protest. The District Commission held that the Complainant only exercised his right to freedom by making an endorsement under protest. It was a mere act of signifying his intention to retain the liberty to dispute the amount. Further, it did not jeopardize the rights of the Insurance Company.

Therefore, the District Commission held that the Insurance Company wrongfully withheld the sanctioned sum of Rs. 52,500/-. It was further observed that insisting the Complainant to accept the unconditional receipt of the amount before releasing it amounted to unfair trade practice and deficiency in service on the part of the Insurance Company.

On procedural grounds, the District Commission observed that the Insurance Company's witness failed to appear for his cross-examination for several years, despite being the examination-in-chief. His continuous absence led to multiple adjournments between 2015-2023, which obstructed the proceedings. In addition, the Insurance Company failed to put any genuine effort into producing him, despite the District Commission's repeated orders. As a result, the survey report submitted by the Insurance Company was deemed to be invalid. Reliance was placed on Vidhyadhar vs Manikrao [AIR 1999 SC 1441], wherein the Supreme Court held that the evidence of a witness who is not cross-examined is valueless.

The District Commission observed that due to the Insurance Company's inability to produce the witness, the Complainant was forced into prolonged litigation for around 15 years. He was also denied his right to receive the insured sum on the mere basis of an expressed protest. Such arbitrary conduct of the Insurance Company compromised his dignity as a consumer. Referring to Yerikala Sunkalamma and Anr. vs State of Andhra Pradesh and Ors. (2025), the District Commission held that public authorities, such as the Insurance Company, must act as model litigants. It held that the Insurance Company failed to apply its mind to the root of the issue and hence, led to an unwarranted litigation.

Based on the aforementioned findings, the District Commission directed the Insurance Company to reimburse Rs. 52,500/-, pay Rs. 75,000/- as compensation towards mental agony and financial loss, and Rs. 25,000/- towards legal costs – all with 9% interest per annum from the date of filing the complaint till the actual date of realization. The Insurance Company was directed to comply with these directions within 30 days of the order copy's receipt.

Case Title: V.A. Sunny vs The Oriental Insurance Co. Ltd.

Case No.: CC 255/09

Advocate for the Complainant: C.K. Hariharaputhran

Advocate for the Opposite Party: C.R. Thomas

Click Here To Read/Download The Order