Loath to take back stolen vehicles recovered

After Shanmugham lost his two-wheeler at the Marina Beach a few months ago, police eventually gave him a non-traceable certificate', which 
he used to claim insurance money. However, two months later, when police tried to contact him after his stolen vehicle was recovered, Shanmugham was not keen to respond because he had already purchased a new vehicle with the insurance money.

According to police officials, such cases are on the rise mainly because of lack of coordination between police and insurance companies and proper verification. The result:insurance companies are unnecessarily losing money on theft claims, and recovered vehicles are lying unused. During a drive conducted in 2008, the city police recovered more than 110 vehicles from the Chennai Mofussil Bus Terminus in Koyambedu. When the owners were traced with the help of registration numbers, it was found that they had already bought new vehicles, financed by insurance claim amounts, and were not keen to take back their stolen vehicles.

"If owners do not turn up to claim their vehicles, we approach the courts concerned and surrender the abandoned vehicles, under Section 102 (power of police officer to seize certain property) of the Criminal Procedure Code," police sources said.

Does there exist a comprehensive list of vehicles stolen and recovered? The National Crime Records Bureau provides details of recovered vehicles on its website. Hence, there is a system to verify whether lost vehicles have beeen recovered, says K Venkatesan, business head (Tamil Nadu), IFFCO-Tokio General Insurance Company Ltd. But most insurance officers say that the existing system is not current or foolproof.

Ajay Bimbhet, managing director, Royal Sundaram Alliance Insurance, feels there is a need for a dynamic high-tech system that will link insurers and the police so that information regarding theft and recovery is instantly available. A preliminary level programme launched by insurers in Delhi did not take off due to lack of interest and initiative by the police.

Without a proper mechanism in place, insurers are circulating data on stolen vehicles amongst themselves and checking the recovery status with the police only once a month, on average. "We also conduct inquiries at the residence of the insured person for theft claims, to confirm recovery and other related information concerning police authorities," Bhimbhet said.

According to the terms and conditions in a motor vehicle insurance policy, the insured, in the case of theft of a vehicle, can hope to claim an amount not exceeding the insured declared value (IDV). Such value usually depends on the age of the vehicle and its market value. The IDV will, thus, reduce every year as the value of the vehicle gets depreciated and the market value comes down. For example, a brand new 220 cc Pulsar costing Rs 89,000 can be insured for the same amount during the first year; however, every successive year, the value decreases by 10 15%, which means that if a claim for theft is preferred in the fourth year, the insured cannot expect reimbursement of more than approximately Rs 60,000 (considering depreciation of 10%).