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When rain damages vehicles

Last fortnight, the road that I take on my way back home from work was completely flooded on account of heavy rains.

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Pushpa Girimaji


Last fortnight, the road that I take on my way back home from work was completely flooded on account of heavy rains. As I drove through it, my car stalled. I tried to restart it, but that did not work. So, I got the car towed to the service centre. However, it was raining very heavily; by the time the tow vehicle arrived, there was further waterlogging, and I was told that the water had entered the engine and the repair would cost over Rs 1 lakh. However, the insurance company is saying that the damage is not covered under the policy. Can you please help me with a decision of the National Consumer Commission in a similar matter?

Let me quote the decision of the National Consumer Disputes Redressal Commission in Bharti AXA General Insurance Company Vs Chandra Mohan Goyal (RP No 4504 of 2014, decided on February 5, 2015). Here, the complainant had to stop the car while on his way to Vrindavan in July 2011 as it was raining heavily. While thus parked, the vehicle got submerged under two feet of water. When the rain stopped and the water receded, the complainant got the vehicle towed to the service centre and the repair of the water-damaged engine cost Rs 98,000.

However, the insurance company offered to pay only Rs 13,950, being the cost of cleaning and replacing certain parts, said to have been damaged directly due to the water. The rest of the damage, the insurance company said, was caused by hydrostatic lock, a consequential damage, not covered under the policy, unless the policy holder pays an extra premium for an add-on ‘engine protection’. 

Dismissing such a contention and upholding the orders of the lower consumer courts directing the insurer to fully indemnify the loss, the National Consumer Disputes Redressal Commission said: “We have perused the insurance policy issued by the petitioner-company to the complainant. The said policy, while covering damage due to flood, cyclone, hailstorm, etc., does not exclude the loss to the vehicle due to hydro static lock. In the absence of such an exclusion, the insurance company will have to reimburse cost of repair of the vehicle on account of damage by heavy rains and flooding irrespective of whether the said loss occurred due to hydrostatic lock or for some other reason.”

However, I would suggest that you first write to the nodal officer of the insurance company and if the response from there is not positive, go to the Insurance Ombudsman. The process there is much simpler and quicker.

Can you quote some decisions of the Ombudsman in this regard?

In Shri Jitendra Kumar Vs Iffco Tokio General Insurance Company Ltd (award dated December 21, 2017), the insurance company similarly repudiated the claim saying that the damage was caused on account of “mishandling and using the vehicle after the damage due to rain water”. Thus it was a consequential loss not covered under the policy as the policy holder had not taken the additional cover of ‘Engine and Gear Box Protect’, the insurer said.

However, on the basis of the opinion of an independent surveyor, the Ombudsman said the damage was caused by flood and inundation and not on account of any consequential damage and therefore the insurer cannot repudiate the claim. However, on the ground that there was a delay of 24 hours in reporting the matter to the insurer, the Ombudsman directed that the claim be settled on a substandard basis.

In Lt Col AK Nag Vs Bharti AXA General Insurance Company Ltd (date of award December 22, 2017) too, where the insurer said that the damage to the engine occurred on account of mechanical breakdown not covered under the policy, the Ombudsman held that the engine damage was caused by flood and rain water peril, included under the policy and directed the insurer to pay Rs 1,52,900.

Meanwhile, given the heavy rains and massive flooding of roads this monsoon, I would suggest abundant caution while driving through such roads. Put the car in low gear and go at a steady, slow pace, without braking. If the car stalls, experts say that one should not crank the vehicle excessively in an attempt to re-start the car as that could cause engine damage. 

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