Farhad Sattha sold his 2007-make Bajaj Pulsar motorcycle to Farzad Mithaiwalla on June 30, 2009, for Rs 45,000.
Under the Motor Vehicles Act (MVA), when a vehicle is sold, the buyer has to apply to the RTO for transfer of the registration within 30 days of purchase. Thereafter, the purchaser has to apply within 14 days to the insurance company for transfer of insurance certificate. The insurance policy cannot be transferred till the RTO's transfer formalities are completed.
On June 30, 2009, Mithaiwalla applied to the RTO for registration transfer. Since the registration certificate issued at the time of purchase was in booklet form, it had to be converted to a smartcard certificate. The RTO took a month to process the transfer and issued the smartcard certificate July 31, 2009.
Thereafter, Mithaiwalla had 14 days, that is by August 14, 2009, to apply for transfer of insurance policy. However, before he could do so, on August 7, 2009, the motorcycle was stolen. An FIR was lodged, but the vehicle could not be traced.
Mithaiwalla approached Bajaj Allianz to file a claim, but was told that he could not do so as the policy had not been transferred to his name. So, he requested Sattha to lodge the claim. But Sattha's claim was rejected, stating that he did not have any insurable interest in the vehicle once it was sold. Thus, Bajaj Allainz refused to pay the claim either to the seller or to the buyer.
Sattha and Mithaiwalla then filed a joint complaint before the Central Mumbai district consumer forum. The insurance company vehemently contested the case and reiterated its stand. The company blamed Mithaiwalla for not having completed the transfer formalities for insurance policy .
In its judgment dated October 7 this year, delivered by B S Wasekar, president, along with member H K Bhaise, the forum observed that most of the facts were admitted and the dispute was regarding the interpretation of law. The forum noted that the bike was stolen August 7, 2009 during the subsistence of the policy period August 23, 2008 to August 22, 2009, for which premium had been paid.
The forum considered Section 157 of the MVA which provides that a policy is deemed to be transferred in favour of the vehicle purchaser. The forum relied on a national commission judgment in the case of Narayan Singh v/s New India Assurance [IV (2007) CPJ 289 (NC)], where it was observed that it was highly deplorable on the part of the insurance company to take undue advantage of the consumers' ignorance in respect of a circular issued by the General Insurance Company stating that on transfer of a vehicle, the insurance automatically gets transferred in favour of the purchaser.
Article referred: http://articles.timesofindia.indiatimes.com/2013-10-21/mumbai/43249700_1_insurance-claim-insurance-policy-transfer
Under the Motor Vehicles Act (MVA), when a vehicle is sold, the buyer has to apply to the RTO for transfer of the registration within 30 days of purchase. Thereafter, the purchaser has to apply within 14 days to the insurance company for transfer of insurance certificate. The insurance policy cannot be transferred till the RTO's transfer formalities are completed.
On June 30, 2009, Mithaiwalla applied to the RTO for registration transfer. Since the registration certificate issued at the time of purchase was in booklet form, it had to be converted to a smartcard certificate. The RTO took a month to process the transfer and issued the smartcard certificate July 31, 2009.
Thereafter, Mithaiwalla had 14 days, that is by August 14, 2009, to apply for transfer of insurance policy. However, before he could do so, on August 7, 2009, the motorcycle was stolen. An FIR was lodged, but the vehicle could not be traced.
Mithaiwalla approached Bajaj Allianz to file a claim, but was told that he could not do so as the policy had not been transferred to his name. So, he requested Sattha to lodge the claim. But Sattha's claim was rejected, stating that he did not have any insurable interest in the vehicle once it was sold. Thus, Bajaj Allainz refused to pay the claim either to the seller or to the buyer.
Sattha and Mithaiwalla then filed a joint complaint before the Central Mumbai district consumer forum. The insurance company vehemently contested the case and reiterated its stand. The company blamed Mithaiwalla for not having completed the transfer formalities for insurance policy .
In its judgment dated October 7 this year, delivered by B S Wasekar, president, along with member H K Bhaise, the forum observed that most of the facts were admitted and the dispute was regarding the interpretation of law. The forum noted that the bike was stolen August 7, 2009 during the subsistence of the policy period August 23, 2008 to August 22, 2009, for which premium had been paid.
The forum considered Section 157 of the MVA which provides that a policy is deemed to be transferred in favour of the vehicle purchaser. The forum relied on a national commission judgment in the case of Narayan Singh v/s New India Assurance [IV (2007) CPJ 289 (NC)], where it was observed that it was highly deplorable on the part of the insurance company to take undue advantage of the consumers' ignorance in respect of a circular issued by the General Insurance Company stating that on transfer of a vehicle, the insurance automatically gets transferred in favour of the purchaser.
Article referred: http://articles.timesofindia.indiatimes.com/2013-10-21/mumbai/43249700_1_insurance-claim-insurance-policy-transfer
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