Car stolen, Insurance not being paid since 3 years

[Shivendra]

Hi this is Shivendra I work for a mutual fund company in Finance in Gurgaon. I bought a car from one of my neighbours in Aug 2007, a Maruti Zen VXI. My neighbour happened to be a retired person and spends most of his time outside India with his sons. I was not able to transfer the car on my name as it was not Euro II compliant and in NCR I was told that it cant be transferred.I was regularly pursuing its transfer and even approached some agents but they were not ready as the car was registered in Ambala. I renewed the policy on this car in the name of the original owner. I paid the insurance company National Insurance thru cheque from my own bank account. In June 2008 the car was stolen. I accordingly informed the insurance company about it. Police has even completed the final report as car was untraceable. The surveyour of my case did not provide any report for around 1.5 yrs. Even after constant approaching. I was honest to him and told him that though I had bought the car the registration is still with the original owner and the insurance is also on the original owners name. Thogh every time he asked for a new document which took me another 1 month to produce. e.g registration certificate from RTO of Ambala where the car was registered. So he kept on asking for new documents even though I told him many times that I am in private job and cant afford these ad hoc requirements , please tell at one go what you want. Finally he wanted to meet the original owner. When my neighbour came to India on his next visit after 6 months I pursuaded him to come to the surveyour. The surveyour took a written statement from him that the car was his own and I was only driving it and caring for it while he was out of India. Then still few months passed. Finally I approached the insurance company. The manager of National Insurance called the surveyour for explanation of delay. Now the surveyour has written in his report that the car was sold by the original owner to me though he cant prove it due to lack of any documents which can show this but still he is of the FEELING that the car was sold and thus neither the original owner nor me have the INSURABLE INTEREST IN THE CAR. So the policy cant be given out. The insurance company is now asking to get a power of atttorney and then they will call the surveyour for a recheck as he doesnt have any evidence. to say that the car was sold. Now getting power of attorney again is a hassle as I will have to approach my neighbour for it who is not in India. This matter has happened 7- 8 months back. I dont understand that when I paid the insurance company from my bank account, why didnt they check insurable interest. Also it is a fact that the car was stolen. It is a fact that policy was in force on the name of person on whose name the car is registered. There is no proof of car being sold to any other person. Then also why insurance payment is bein denied. Please suggest what to do!!!

[Rahul]

What is insurable interest?
The existence of insurable interest is an essential ingredient ofany insurance contract. In an insurance contract, it is not the house or machinery or the ship that is insured, but it is the pecuniary interest of the insured in that house, machinery or shop etc. which is insured. The insured must stand in a relationship with the subject matter of insurance whereby he benefits from its safety or well-being and would be prejudiced by its loss or damage. And this relationship must be recognized by law.

Because at the time of the loss, you were the owner of the vehicle because you have bought the car. But you have not transferred the ownership in your name and continued the RC and Insurance in the old owner. The surveyor has denied the claim. You can raise it in the consumer court.

[Rahul]

But you have no insurable interest in it, because the title of the ownership is still with the previous owner, so the contact between you and the insurance company is void. Even if you have paid the premium.