Jaguar Owner Wins Rs 2.02 Lakh After Insurer Rejects Rainwater Damage Claim

A Jaguar owner has secured relief from a consumer commission after his motor insurer rejected a claim for damage caused by rainwater entering the vehicle through a partially open window.

The Chhattisgarh District Consumer Disputes Redressal Commission directed the insurer to pay Rs 1.75 lakh towards the claim. It also awarded Rs 20,000 for mental agony and Rs 7,000 as litigation costs, taking the total relief to Rs 2.02 lakh.

The commission held that policy conditions and exclusions not supplied to the insured could not subsequently be used to repudiate his claim.

Rainwater Damaged Car’s Infotainment System

The Jaguar was covered under a private car insurance policy valid from November 29, 2020 to November 28, 2021.

In August 2021, rainwater entered the car because the window on the driver’s side had been left slightly open. The water damaged the vehicle’s infotainment system and some other components, according to a recent report by Financial Express.

The owner approached the insurer and lodged a claim. The insurer’s surveyor put the damage at Rs 1.98 lakh, while the owner said he had paid Rs 2.73 lakh for the repairs.

The insurer turned down the claim on February 4, 2022, saying the policy did not cover damage caused by rainwater. It also said that leaving the window open amounted to gross negligence and violated the conditions of the insurance contract.

The car owner subsequently approached the consumer commission, alleging deficiency in service and unfair trade practice. He contended that the insurer had not given him the complete terms and conditions when the policy was issued.

Insurer Could Not Enforce Undisclosed Exclusions

The commission found that the policy supplied to the owner comprised four pages. However, the terms and conditions later produced by the insurer ran into six pages and could not be treated as part of the policy originally given to him.

The insurer itself produced only three pages of the four-page policy before the commission. The order noted that the exclusions relied upon for rejecting the claim had not been provided to the customer along with the policy document.

The commission, therefore, concluded that these conditions were not binding on the policyholder. Rejecting the claim on the strength of undisclosed exclusions was held to be unjustified and amounted to deficiency in service and unfair trade practice.

The order was passed by a bench comprising President Dakeshwar Prasad Sharma and members Nirupma Pradhan and Anil Kumar Agnihotri on August 24.

The ruling underlines why policyholders should retain the complete policy wording, including schedules, endorsements and exclusions. If an insurer rejects a claim under a clause that was never furnished, the policyholder can seek a copy of the relevant document and challenge the decision through the insurer’s grievance mechanism, the Insurance Ombudsman or a consumer commission.

FAQs

1. Does motor insurance cover rainwater damage to a car?
Coverage depends on the policy terms and circumstances. An insurer may reject a claim if a relevant exclusion applies, but the exclusion must have been disclosed to the policyholder.

2. Can an insurer rely on policy conditions that were not supplied to the customer?
The commission held that undisclosed terms and exclusions were not binding on the policyholder and could not be used to reject the claim.

3. What can policyholders do if a motor insurance claim is rejected?
They can seek the clause cited by the insurer and challenge the decision through the insurer’s grievance mechanism, the Insurance Ombudsman or a consumer commission.