Insurance

Bargaining power - Standard form contracts

Contract – Interpretation of - Standard form contracts - Bargaining power – There is no gainsaying that in a contract, the bargaining power is usually at equal footing - In this regard, the joint intention of the parties is taken into consideration for interpretation of a contract - However, in most standard form contracts, that is not so - In this regard, the Court in such circumstances would consider the application of the rule of contra preferatum, when ambiguity exists and an interpretation of the contract is preferred which favors the party with lesser bargaining power - Insurance - Commercial Vehicle Package Policy. #2020 SCeJ 69

'Co-operate' as used under the contract needs to be assessed in facts and circumstances

That the term 'co-operate' as used under the contract needs to be assessed in facts and circumstances. While assessing the 'duty to co-operate' for the insured, inter alia the Court should have regards to those breaches by the insured which are prejudicial to the insurance company. Usually, mere delay in informing the theft to the insurer, when the same was already informed to the law enforcement authorities, cannot amount to a breach of 'duty to co-operate' of the insured. #2020 SCeJ 69

Words 'immediate',

Insurance - Standard Form for Commercial Vehicles Package Policy – Theft - Words 'immediate', in condition No. 1 - Condition will have to be divided into two parts – First part deals that all the things which are required to be done under this part are related to an occurrence of an accident - Second part of Condition No. 1 deals with the 'theft or criminal act other than the accident' - It provides, that in case of theft or criminal act which may be the subject of a claim under the policy, the insured shall give immediate notice to the police and co-operate with the company in securing the conviction of the offender - The object behind giving immediate notice to the police appears to be that if the police is immediately informed about the theft or any criminal act, the police machinery can be set in motion and steps for recovery of the vehicle could be expedited - In a case of theft, the insurance company or a surveyor would have a limited role - It is the police, who acting on the FIR of the insured, will be required to take immediate steps for tracing and recovering the vehicle - Per contra, the surveyor of the insurance company, at the most, could ascertain the factum regarding the theft of the vehicle. #2020 SCeJ 69

Words 'co-operate' and 'immediate

Insurance - Standard Form for Commercial Vehicles Package Policy - Words 'co-operate' and 'immediate', in condition No. 1 -Term 'co-operate' as used under the contract needs to be assessed in facts and circumstances - While assessing the 'duty to co-operate' for the insured, inter alia the Court should have regards to those breaches by the insured which are prejudicial to the insurance company - Usually, mere delay in informing the theft to the insurer, when the same was already informed to the law enforcement authorities, cannot amount to a breach of 'duty to co-operate' of the insured. #2020 SCeJ 69