Tribunal overturns insurer's rejection of motor claim

Fake driver's licence not an automatic ground for rejection, ruling says

Tribunal overturns insurer's rejection of motor claim

Insurance News

By Gabriel Olano

The District Consumer Disputes Redressal Commission of Chandigarh, India has overturned the United India Insurance Company’s rejection of a motor insurance claim made by the owner of a cement mixer truck.

The insurer was ordered to pay the claim of INR530,698 (around SG$9,500), plus INR11,000 in litigation expenses.

Panchkula resident Deepak Bansal, a representative of the truck’s owner, approached the commission after United India Insurance refused to pay the claim for an accident the truck encountered on Sept. 29, 2019, The Tribune reported.

The insurer said it rejected the claim after its appointed investigator found that the licence of the truck’s driver at the time of the accident was fake. Bansal, who paid out of pocket for the truck’s repair, said he was not aware that the driver he hired had a fake licence and that he found the driver’s skill satisfactory during evaluation.

“While hiring a driver, the employer is expected to verify if the driver has a driving licence,” the commission wrote in its decision. “If the driver produces a licence, which on the face of it looks genuine, the employer is not expected to further investigate into the authenticity of the licence unless there is a cause to believe otherwise. If the employer finds the driver to be competent to drive the vehicle and has satisfied himself that the driver has a driving licence, there would be no breach of Section 149(2)(a)(ii). It will be unreasonable to place such a high onus on the insured to make enquiries with [Regional Transport Offices] all over the country to ascertain the veracity of the driving licence.”

However, if the insurer is able to prove that the owner knew that the licence was fake, then it is justified in rejecting the claim, the commission said.

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