Motor - Delay in Lodging Police Report
The Insured’s theft claim for the stolen vehicle was repudiated by the Insurer on the ground that the Insured had breached Condition 2 (d) of the motor policy as the Insured had only lodged the police report pertaining to the loss after a lapse of 9 days from the date of loss.
Investigation and Findings
Policy Condition 2 (d) provides as follows:-
“In case of theft or other act which may give rise to a claim under this policy, you must without undue delay make a report to the police...”
It was therefore clear from policy Condition 2(d) that no time frame is expressly specified within which a police report for theft is to be made. This is unlike policy Condition 2 (c) which specifies that “All accidents must be reported to the police as required by law” and Section 52 (2) of the Road Transport Act 1987 specifically provide that any accident must be reported to the policy within 24 hours.
Hence, since the time within which a police report for theft of the insured vehicle has to be made was not expressly specified in the terms of the policy, the Case Manager was of the view that surrounding circumstances could be taken into account to explain a delay by the Insured to lodge a police report.
In this present case, the Case Manager had noted from the Insured’s claim form and the loss adjuster’s report that the reasons given by the Insured for lodging the police report late was because she had waited for her son to return from outstation before proceeding to lodge the report. The Case Manager opined that the reason given by the Insured was not unreasonable, particularly considering the age and background of the Insured.
It was also observed that there was no evidence that the police had taken any action against the Insured for late lodgment of the police report since there is no legal provision to do so unlike in an accident case.
The Case Manager had also perused the loss adjuster’s report and noted that there is nothing to state that the delay in lodging the police report had prejudiced their investigations or that the Insured’s claim is fraudulent. Therefore the Case Manager opined that the delay had not prejudiced the Insurer’s interest in any way.
In this respect, the Case Manager referred to the Bank Negara Malaysia’s Guidelines on Claims Settlement Practices – BNM/RH/GL003-9 para 126.96.36.199 which states as follows:-
An Insurer should not repudiate a claim on the following grounds:-
- Technical breaches of warranty or policy condition which are not material or unconnected to the circumstances of loss, unless it has prejudiced the interest of the insurer or has exceeded the time bar as provided under the law.
The underlying rationale is the authenticity of the claim.
The Insurer reviewed their decision and agreed to settle the claim.