CNG kit can’t void insurance claim
Installing a CNG kit in your car will not make you ineligible for insurance claims. A consumer court ordered an insurance company to pay 75% of the total insured value of a car that caught fire.
The deduction was because the owner fitted a CNG kit much after the purchase of the vehicle and he did not intimate the authorities and the insurance company about the changes made to the vehicle.
The Consumer Dispute Redressal Forum, Ahmedabad (city) last week ruled that installing a CNG kit in a petrol vehicle and not intimating the authorities and the insurance company was a violation of the policy conditions, but it was not a fundamental and material deviation from the policy conditions that should prevent the car owner from receiving the claim amount. Moreover, the cause of the fire was not attributed to the CNG kit being fixed in the vehicle, it observed.
In this case, a resident of Rakhial, Jayanti Parmar, fitted a CNG kit to his petrol car. While he was returning from Shamlaji, his car suddenly caught fire. As the vehicle was written off as a total loss, he claimed the full insured declared value of Rs 2.5 lakh. New India Assurance Co Ltd rejected his claim on the ground that the surveyor’s report revealed that a CNG kit had been fitted to the vehicle, but the registration (RC) book did not mention that the car’s status was changed to a dual-fuel vehicle. Intimation was also not given to the company. Since there was an attempted misrepresentation of the facts, Parmar was not entitled to get the insurance payout.
After hearing the arguments, the consumer court ordered the insurance company to pay 75% of the total insurance amount of Rs 2.5 lakh, or Rs 1,87,500. The charge of salvaging the vehicle and police access was deducted and the court ordered the insurer to pay a total of Rs 1,76,500 to Parmar with 8% interest.
The consumer court noted that the rejection of claim was without justification and amounted to a deficiency in service and unfair trade practice by insurer. The court ordered the insurer to pay an extra Rs 5,000 towards compensation for mental agony suffered by the car owner and his legal expenditure.