The owner, a resident of Solapur, left his BMW on a deserted stretch of highway after a tyre puncture left him stranded late at night. The vehicle was locked and parked, then the next morning was discovered completely burnt.
The insurer, a major national policyholder, denied the claim citing a breach of Condition 4, which it interpreted as an illegal abandonment of the vehicle. It argued that the owner had failed to notify police and the insurer in writing, and that an unattended tyre puncture is not an accidental loss. The policy’s IDV was Rs 70,00,000, while the owner had paid a premium of Rs 1,65,996.
The case dripped into court for more than a decade, with the owner repeatedly appealing to the Maharashtra State Consumer Disputes Redressal Commission. The insurer’s counter‑argument was that the car’s value had depreciated to Rs 59 lakh because of a gap in coverage, and that the owner’s failure to move the vehicle to a safer spot had caused the fire.
In a detailed order, the commission clarified that Condition 4 does not prohibit leaving a breakdown vehicle unattended; it merely requires the insured to take reasonable precautions. The commission found the owner had no choice, citing the late hour and lack of repair facilities. It rejected the insurer’s depreciation claim and ruled that the insurer could not unilaterally reduce the IDV.
Sarthak Prashar, Director of Global People Solutions at Grant Thornton Bharat, said the commission’s decision "removes the burden of unjustified repudiation on the policyholder, preserving the integrity of insurance contracts." The order also mandated the insurer to pay Rs 70 lakh, plus 7% per annum interest from November 23, 2012, and compensation of Rs 50,000 for mental anguish and Rs 25,000 for litigation costs.
The insurer is now required to settle the claim within 30 days of the order, or face enforcement action. The case serves as a precedent for policyholders who find their vehicles lost to accidental fires after being left unattended.