Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors

[S. Anoop Kumar]

Dear Friends,

 

 

As per section 55 of MV Act, for all vehicles which are destroyed or rendered incapable of use the RCs need to be cancelled.  I am reproducing the relevant section below:

 

---

55. Cancellation of registration.

(1) If a motor vehicle has been destroyed or has been rendered permanently incapable of use, the owner shall, within fourteen days or as soon as may be, report the fact to the registering authority within whose jurisdiction he has the residence or place of business where the vehicle is normally kept, as the case may be, and shall forward to the authority the certificate of registration of the vehicle.

 

(2) The registering authority shall, if it is the original registering authority, cancel the registration and the certificate of registration, or, if it is not, shall forward the report and the certificate of registration to the original registering authority and that authority shall cancel the registration.

 

(3) Any registering authority may order the examination of a motor vehicle within its jurisdiction by such authority as the State Government may by order appoint and, if upon such examination and after giving the owner an opportunity to make any representation he may wish to make (by sending to the owner a notice by registered post acknowledgment due at his address entered in the certificate of registration), it is satisfied that the vehicle is in such a condition that it is incapable of being used or its use in a public place would constitute a danger to the public and that it is beyond reasonable repair, may cancel the registration.

---

A senior surveyor from North India was arrested during last year by Chandigarh Police for facilitating sale of wreck of total loss vehicles, the RCs of which have been misused by the salvage buyers and used for selling stolen vehicles.   Some more surveyors from MP, UP, Delhi, AP, Karnataka, Kerala, Tamilnadu, etc. also came under scanner of police officials for facilitating sale of wreck of total loss vehicles.  Police are also investigating the role of insurance officials and also other surveyors from all over India and are trying to establish the nexus between the insurance officials, surveyors, salvage buyers and auto theft gangs.   This would prove to be very damaging to the reputation of the Motor Surveyors who are trying to the reduce the loss on insurance claims.  

 

It is suggested Total Loss Vehicles be settled on Total Loss Basis subject to the RC getting cancelled by the insured.  Oriental Insurance has been following this mode of claim settlement for the past 3-4 years in order to avoid complications at a later date and getting implicating in vehicle theft crimes.  

 

 

More views and opinions from members invited.  

 

 

With best regards,

S. Anoop Kumar.    

 

 

[bipin saluja]

If the claim is settled on net of salvage or a compromisevalue , cashloss i.e the salvage to be retianed/sold  by the Insured, then the hassels of Total loss are taken care. Moreover, why the Surveyor should be held responsible for Total loss vehicle, because it is the Insurer who are responsible to surrender the R/C and auction/sell the wreck  BIPIN SALUJA --- On Sat, 4/8/12, S. Anoop Kumar <s.anoo...@gmail.com> wrote:

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[S. Anoop Kumar]

Dear Mr. Rajaram Rao & others,

 

 

An insurance policy is a contract between two parties.  It is not the law.   But MV Act is the law.   And any contract should be within the framework of the law of the land.    The conditions in the policy are designed to facilitate just and fair settlement in the event of a claim arising.    The definitions of 'Total Loss' and/or 'Constructive Total Loss'   (TL/CTL) are given to give a direction and clarity as to at which point of time or level a damaged vehicle can be declared as TL or CTL.   And as surveyors handling the claim it is for the surveyor to establish or prove that the damaged vehicle qualifies to be a case for TL or CTL.   The IMT states - "A vehicle will be considered to be a CTL,  where  the  aggregate cost of retrieval  and / or repair  of the vehicle subject to terms and conditions of the policy exceeds 75% of the IDV."

 

 

As for as the Motor Policy is concerned, condition 3 is reading as below:

 

---

The Company may at its own option repair reinstate or replace the vehicle or part thereof and/or its accessories or may pay in cash the amount of the loss or damage and the  liability of the Company shall not exceed:

 

(a) for total loss / constructive total loss of the vehicle - the  Insured's Declared  Value (IDV) of the vehicle (including accessories  thereon)  as specified in the Schedule less the value of the wreck.

 

(b)  for partial losses, i.e. losses other than Total Loss/Constructive Total Loss of the vehicle -  actual and  reasonable costs of repair and/or replacement of parts lost/damaged subject to depreciation as per limits specified.

---

 

Like I stated earlier, an insurance policy is a contract between two parties and not the law.    And the policy contract here is clearly one-sided loaded in favour of the insurance company and the insured does not have any choice or power to negotiate, seek and/or demand any amends/changes.     

 

 

It is for the surveyor to declare whether the damaged vehicle qualifies to be declared as a case for TL or CTL while following the policy conditions but within the confines of the law of the land prevailing.    By declaring any vehicle as a case for Total Loss, the surveyor is also implying and/or clearly declaring/certifying that the damaged vehicle has been rendered permanently incapable of use.   Hence, it is prudent on the part of the surveyor to recommend to the insurance company to treat the damaged vehicle as Total Loss and advise them to call for cancellation of RC by the insured and sell the value of wreck or deduct the value of wreck but without vehicle documents.  

 

 

But what a motor surveyor is doing is he is scouting the market to locate a salvage buyer who is prepared to give best & highest value for the wreck complete with documents, introducing the salvage buyer to the insured, facilitating the sale of wreck with documents - all with clear knowledge and permission of the insurer's.  

 

 

Thus the surveyor is clearly becoming a party to some illegal activity and a crime.   And it is easy for the insurer's to quote the survey report & surveyor's recommendations as a legal document resulting in settlement of a claim (citing 64UM of Insurance Act) and wash their hands off leaving the surveyor to defend himself.   Also the insured would only point his finger towards the surveyor who negotiated the deal with the salvage buyer, who introduced the salvage buyer and facilitated the sale transaction of the wreck/damaged vehicle.   Hence, it is the insurance surveyor who is highly vulnerable and clearly at the receiving end with no support coming from any end.    

 

 

This is what exactly happened in the case of Jalandhar and Chandigarh car theft claims where one of our senior surveyor colleague has been arrested, served jail sentence for more than 40 days as an under-trial, now out on bail, but he is still fighting the case in the criminal court facing serious criminal charges.    Another surveyor from MP is also reported to have been arrested, now in jail as an under-trial and is still trying for bail in a similar case.    Are these not enough evidences for us to realise the seriousness of the matter and things in store for us (motor surveyors) in the times to come.  

 

 

Hence, in my personal opinion, as a motor surveyor, we should give assessment figures on repair loss basis, and likely realisable value on wreck without vehicle documents in the event of TL or CTL and also quote Section 55 of MV Act in the report to safeguard our own position.   And allow the insurance company to take final decision as to disposal of wreck and settlement of claim.     

 

 

More views from senior motor surveyors requested.   I also invite Mr. BD Mohta and Mr. Atul Datt (though not motor surveyors) to share their views on the finer legal points and on the position & role of insurance surveyors in the given situation. 

 

 

With best regards,

 

S. Anoop Kumar.  

 

 

 

 

 

 

 

 

----- Original Message -----

From: rajaram rao

To: insurance-su...@googlegroups.com

Sent: Saturday, August 04, 2012 3:41 PM

Subject: Re: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors

Here we need exact definition of the Term "Total Loss" and "Constructive Total Loss".

As per policy, Constructive Total Loss or CTL means 

"The insured vehicle shall be treated as a CTL if the aggregate cost of retrieval and / or repair of the vehicle, subject to terms and conditions of the policy exceeds 75% of the IDV of the vehicle."

"IDV shall be treated and ‘Market Value” throughout the policy period without any further depreciation for the purpose of Total Loss (TL) / Constructive Total Loss (CTL) claims."

As per Motor Vehicles Act Total Loss of vehicle means

" If a motor vehicle has been destroyed or has been rendered permanently
> incapable of use"

Therefore "Total Loss" / "CTL"  term has two different meaning as per Insurance Policy and Motor Vehicles Act.

In general as per motor vehicles act Total Loss means complete destruction of the vehicle beyond repairs and/or incapable of use. whereas as per Insurance CTL means the cost of repairs exceeds the 75% of IDV.

So in my opinion the same can not be considered as the same. 

And further in CTL cases the Insurance Company or Insurance Surveyor is not legally responsible for the Sale of the Salvage or wreck of the vehicle. They only recommend the Insured the value of the wreck in as is where condition. He signs Form 29, Form 30 and sells the vehicle to the salvage buyer. If he is not interested to sell then he can retain the accident vehicle with him and agree for the settlement of the claim as recommended. Even though Insurance Company and Surveyor fix the value of the salvage they are not directly involved in the sale of the wreck/salvage. The Insured has option to sell or retain the vehicle.

In Total Loss claims where vehicle is damaged beyond repairs, and incapable for use, or vehicle lost, completely burnt cases the case has to be settled on only Total Loss Basis only after surrendering Registration Certificate and Tax Card. etc.,

"TOTAL LOSS" and "CONSTRUCTIVE TOTAL LOSS" words need careful interpretation.

This is my opinion.

Thanking you

 

On Sat, Aug 4, 2012 at 12:15 PM, Prajith kumar.I.P <ippr...@gmail.com> wrote:

Dear Sir,

In this matter our IIISLA Presdent earlier requested the IRDA, Insurers & Surveyors to stop Cash loss, Salvage loss settlement, etc, I would like know the response  received from them. 

Thanks & Regards,

Prajith kumar.I.P.

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[Vasant Godbole]

Dear friends.

 

It is not only the question of R C being mis used by some one at a later date,  but  a more serious  question is about the mechanical fitness of the vehicle, which is repaired at a very cheap cost and replacing parts with second parts , form similar vehicles that are dismantled and parts kept for sale in the scrap market.

 

With modern technology being used in most of the modern vehicles of all types, it is imperative that all serious losses on vehicles whether 2 or 3 , 4 or multi axle vehicles, be settled on Total Loss basis and not on  CASH LOSS basis which was being done many times in the past,  Insurers are aware about the risk involved in running a  vehicle not so fit mechanicaly, and would prefer to have the clasim settled on TOTAL BASIS , with surrender of the cert. of regn. to the proper authority.

 

Earlier in many cases it ws seen that the claim in heavy losses were settled on  CASH LOSS basis, and during the same policy period , may be twice over .  One can imagine what will be the mechanical fitness of the vehicle , where repairs have been carried out at cheapest cost.   I suggest that the surveyors body should take up such issues with the insurers forcefully, rather than getting guided by insurers, on such matters .

 

V C Godbole,  Nagpur  

From: bipin saluja <bipinsaluj...@yahoo.com>
To: insurance...@googlegroups.com
Sent: Saturday, August 4, 2012 2:39 PM
Subject: Re: [Adjusters:12468] Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors

If the claim is settled on net of salvage or a compromisevalue , cashloss i.e the salvage to be retianed/sold  by the Insured, then the hassels of Total loss are taken care. Moreover, why the Surveyor should be held responsible for Total loss vehicle, because it is the Insurer who are responsible to surrender the R/C and auction/sell the wreck  BIPIN SALUJA --- On Sat, 4/8/12, S. Anoop Kumar <s.anoo...@gmail.com> wrote:

From: S. Anoop Kumar <s.anoo...@gmail.com> Subject: [Adjusters:12467] Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors To: "Insurance Surveyors India" <insurance-su...@googlegroups.com> Cc: iiisl...@googlegroups.com, "Insurance Adjusters" <Insurance...@googlegroups.com> Date: Saturday, 4 August, 2012, 9:28 AM

Dear Friends,     As per section 55 of MV Act, for all vehicles which are destroyed or rendered incapable of use the RCs need to be cancelled.  I am reproducing the relevant section below:

55. Cancellation of registration. (1) If a motor vehicle has been destroyed or has been rendered permanently incapable of use, the owner shall, within fourteen days or as soon as may be, report the fact to the registering authority within whose jurisdiction he has the residence or place of business where the vehicle is normally kept, as the case may be, and shall forward to the authority the certificate of registration of the vehicle.   (2) The registering authority shall, if it is the original registering authority, cancel the registration and the certificate of registration, or, if it is not, shall forward the report and the certificate of registration to the original registering authority and that authority shall cancel the registration.   (3) Any registering authority may order the examination of a motor vehicle within its jurisdiction by such authority as the State Government may by order appoint and, if upon such examination and after giving the owner an opportunity to make any representation he may wish to make (by sending to the owner a notice by registered post acknowledgment due at his address entered in the certificate of registration), it is satisfied that the vehicle is in such a condition that it is incapable of being used or its use in a public place would constitute a danger to the public and that it is beyond reasonable repair, may cancel the registration.

A senior surveyor from North India was arrested during last year by Chandigarh Police for facilitating sale of wreck of total loss vehicles, the RCs of which have been misused by the salvage buyers and used for selling stolen vehicles.   Some more surveyors from MP, UP, Delhi, AP, Karnataka, Kerala, Tamilnadu, etc. also came under scanner of police officials for facilitating sale of wreck of total loss vehicles.  Police are also investigating the role of insurance officials and also other surveyors from all over India and are trying to establish the nexus between the insurance officials, surveyors, salvage buyers and auto theft gangs.   This would prove to be very damaging to the reputation of the Motor Surveyors who are trying to the reduce the loss on insurance claims.     It is suggested Total Loss Vehicles be settled on Total Loss Basis subject to the RC getting cancelled by the insured.  Oriental Insurance has been following this mode of claim settlement for the past 3-4 years in order to avoid complications at a later date and getting implicating in vehicle theft crimes.       More views and opinions from members invited.       With best regards, S. Anoop Kumar.

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[NARESH K TAGOTRA]

Dear All,

I am sharing ( as an attachment ) hereby the code of practice for disposal of motor salvage as being displayed by association of British insurers as collected from the link http://www.abi.org.uk/Information/Codes_and_Guidance_Notes/General_Insurance_Codes_and_Guidance_Notes.aspx .

The code had distinguished the salvage in categories as A, B, C & D and similar categories need to be reflected in the survey reports. Indian insurers associations too need to bring such similar guidelines . R.C. of vehicles falling under A and B categories need to be cancelled as per provision of the M.V.Act but for settlement of vehicles falling under C and D Categories need not be cancelled.

I further suggest the surveyors and insurers should find new ways to prevent misuse also and new steps should be taken. One such suggestion suggested by me after Chandigarh incident is at URL http://isalvageauction.blogspot.in/2011_10_01_archive.html . With further suggestions and refinements preventive measures can be taken by the insurers as they are the final settling authority.

With regards

NARESH K TAGOTRA

www.isalvageauction.com 

[S. Anoop Kumar]

Dear Mr. Rohila Praveen and others,

 

 

I have been facing a similar situation like yours and I am clearly giving the options to the insurer's as to available modes of claim settlement under 3 headings.   They are (1) Repair Loss Basis, (2) Total Loss Basis showing the likely realisable value on wreck without vehicle documents & (3) Total Loss Nett of Salvage Basis.   But my report also contains a comment which would read as:

 

---

However, insurer's are advised to settle the claim on Total Loss Basis and also get the RC on the vehicle cancelled in order to avoid any future complications arising out of sale and/or misuse of RC.   This would be in compliance with the section 55 of Motor Vehicle Act.    

 

 

Final decision is left to the discretion of the insurer's and such decision may be communicated to me to enable me finalise the loss assessment and file my final report.  The insured may be informed of the decision to enable them take further action as deemed fit and proper. 

---

 

I would not say that in the event something goes wrong that I would be free of the charges.   I might still be vulnerable and would still become a party to the wrong doing.  Atleast I would have to go thro the police harassment and harrowing experience.   But here I can always show that the final decision has been taken by the insurance company & I have made a note of caution.   But once I am in the grip of the police as a suspect or as an accused, it would be a long drawn legal battle and I would be just on my own with my personal reputation & image shattered and spending my life time and also my entire savings to come out of the mess I would be forced or drawn into.  

 

 

Let me take you further under which sections of Indian Penal Code (IPC) the police would like to frame the charges if the surveyor becomes an accused and charged of wrong doing in the event the RC of the total loss vehicle is misused by the salvage buyer or any other buyer down the line to sell any other stolen vehicle using the RC:

 

1.120 (B) - Punishment of criminal conspiracy
2. 201 - Causing disappearance of evidence of offence, or giving false information to screen offender
3. 411 - Dishonestly receiving stolen property
4. 420 - Cheating and dishonestly inducing delivery of property
5. 467 - Forgery of valuable security, will, etc.
6. 468 - Forgery for purpose of cheating
7. 471 - Using as genuine a forged document
8. 473 - Making or possessing counterfeit seal, etc., with intent to commit forgery punishable otherwise
9. 474 - Having possession of document knowing it to be forged and intending to use it genuine
10.489 - Tampering with property mark with intent to cause injury

Read the respective IPC sections to know the severity of the crimes against the relevant sections and the punishments prescribed.  

Or just imagine the nightmarish experience of the surveyor if the RC of total loss vehicle lands up in the hands of a terrorist outfit with a stolen vehicle.  

 

My intention is not to create a scare among the surveyors but to caution all my surveyor brothers that we need to take all the care that is needed to protect ourselves and nothing can be left to chance.   

 

With best regards,

 

S. Anoop Kumar.

 

 

 

----- Original Message -----

From: rohila praveen

To: insurance-su...@googlegroups.com

Sent: Sunday, August 05, 2012 3:39 PM

Subject: Re: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors

Dear Anoop ji & others, I am also facing a similar situation. A vehicle is found total loss and recommended for Total loss as the repairing charges exceeded 90% of the IDV. Now the concerned BM is asking to submit addendum on the basis of Total Loss on net of salvage basis and Repair Cash Loss basis. I have no option except to refuse his request and now after reading your opinion I am relaxed about my steps taken. However the matter is also reported to RO officials. Thanks and regards, Praveen Rohila    --- On Sun, 5/8/12, Atul Datt <ad...@matrixworld.biz> wrote: From: Atul Datt <ad...@matrixworld.biz> Subject: Re: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors To: "S. Anoop Kumar" <s.anoo...@gmail.com> Cc: iiisl...@googlegroups.com, "Insurance Adjusters" <Insurance...@googlegroups.com>, "Insurance Surveyors India" <insurance-su...@googlegroups.com> Date: Sunday, 5 August, 2012, 2:40 PM Dear Anoop garu,   The legal issues in the matter at hand, have been very ably elucidated by you. While I am not a Motor Surveyor and have very little knowledge in the matter, might I add a word on the practical connotations thereof. On account of the numerous instances of misuse, CTL is now being looked at with extreme suspicion by the authorities. If any of our brethren unfortunately become part of an investigation by the authorities, the process being what it is, they would suffer long and hard, even if innocent of wrong doing. I would therefore, urge that all Motor Surveyors engage with Insurers and jointly request them to stop settling claims on CTL basis, as has been done by Oriental. At the very least, they should all insist that the registration of the wreck be cancelled, as per law, so that misuse and hence potential harassment may be avoided.   Best Regards,   ATUL  DATT SLA, New Delhi 9810058885

From: S. Anoop Kumar Sent: Saturday, August 04, 2012 8:21 PM To: Insurance Surveyors India Cc: iiisl...@googlegroups.com ; Insurance Adjusters ; BD Mohta ; Atul Datt Subject: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors

Dear Mr. Rajaram Rao & others,     An insurance policy is a contract between two parties.  It is not the law.   But MV Act is the law.   And any contract should be within the framework of the law of the land.    The conditions in the policy are designed to facilitate just and fair settlement in the event of a claim arising.    The definitions of 'Total Loss' and/or 'Constructive Total Loss'   (TL/CTL) are given to give a direction and clarity as to at which point of time or level a damaged vehicle can be declared as TL or CTL.   And as surveyors handling the claim it is for the surveyor to establish or prove that the damaged vehicle qualifies to be a case for TL or CTL.   The IMT states - "A vehicle will be considered to be a CTL,  where  the  aggregate cost of retrieval  and / or repair  of the vehicle subject to terms and conditions of the policy exceeds 75% of the IDV."     As for as the Motor Policy is concerned, condition 3 is reading as below:   The Company may at its own option repair reinstate or replace the vehicle or part thereof and/or its accessories or may pay in cash the amount of the loss or damage and the  liability of the Company shall not exceed:   (a) for total loss / constructive total loss of the vehicle - the  Insured's Declared  Value (IDV) of the vehicle (including accessories  thereon)  as specified in the Schedule less the value of the wreck.   (b)  for partial losses, i.e. losses other than Total Loss/Constructive Total Loss of the vehicle -  actual and  reasonable costs of repair and/or replacement of parts lost/damaged subject to depreciation as per limits specified.   Like I stated earlier, an insurance policy is a contract between two parties and not the law.    And the policy contract here is clearly one-sided loaded in favour of the insurance company and the insured does not have any choice or power to negotiate, seek and/or demand any amends/changes.

It is for the surveyor to declare whether the damaged vehicle qualifies to be declared as a case for TL or CTL while following the policy conditions but within the confines of the law of the land prevailing.    By declaring any vehicle as a case for Total Loss, the surveyor is also implying and/or clearly declaring/certifying that the damaged vehicle has been rendered permanently incapable of use.   Hence, it is prudent on the part of the surveyor to recommend to the insurance company to treat the damaged vehicle as Total Loss and advise them to call for cancellation of RC by the insured and sell the value of wreck or deduct the value of wreck but without vehicle documents.

But what a motor surveyor is doing is he is scouting the market to locate a salvage buyer who is prepared to give best & highest value for the wreck complete with documents, introducing the salvage buyer to the insured, facilitating the sale of wreck with documents - all with clear knowledge and permission of the insurer's.       Thus the surveyor is clearly becoming a party to some illegal activity and a crime.   And it is easy for the insurer's to quote the survey report & surveyor's recommendations as a legal document resulting in settlement of a claim (citing 64UM of Insurance Act) and wash their hands off leaving the surveyor to defend himself.   Also the insured would only point his finger towards the surveyor who negotiated the deal with the salvage buyer, who introduced the salvage buyer and facilitated the sale transaction of the wreck/damaged vehicle.   Hence, it is the insurance surveyor who is highly vulnerable and clearly at the receiving end with no support coming from any end.         This is what exactly happened in the case of Jalandhar and Chandigarh car theft claims where one of our senior surveyor colleague has been arrested, served jail sentence for more than 40 days as an under-trial, now out on bail, but he is still fighting the case in the criminal court facing serious criminal charges.    Another surveyor from MP is also reported to have been arrested, now in jail as an under-trial and is still trying for bail in a similar case.    Are these not enough evidences for us to realise the seriousness of the matter and things in store for us (motor surveyors) in the times to come.       Hence, in my personal opinion, as a motor surveyor, we should give assessment figures on repair loss basis, and likely realisable value on wreck without vehicle documents in the event of TL or CTL and also quote Section 55 of MV Act in the report to safeguard our own position.   And allow the insurance company to take final decision as to disposal of wreck and settlement of claim.          More views from senior motor surveyors requested.   I also invite Mr. BD Mohta and Mr. Atul Datt (though not motor surveyors) to share their views on the finer legal points and on the position & role of insurance surveyors in the given situation.

With best regards,   S. Anoop Kumar.

----- Original Message -----

From: rajaram rao To: insurance-su...@googlegroups.com Sent: Saturday, August 04, 2012 3:41 PM Subject: Re: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors   Here we need exact definition of the Term "Total Loss" and "Constructive Total Loss".   As per policy, Constructive Total Loss or CTL means   "The insured vehicle shall be treated as a CTL if the aggregate cost of retrieval and / or repair of the vehicle, subject to terms and conditions of the policy exceeds 75% of the IDV of the vehicle."

"IDV shall be treated and ‘Market Value” throughout the policy period without any further depreciation for the purpose of Total Loss (TL) / Constructive Total Loss (CTL) claims." As per Motor Vehicles Act Total Loss of vehicle means

" If a motor vehicle has been destroyed or has been rendered permanently > incapable of use"

Therefore "Total Loss" / "CTL"  term has two different meaning as per Insurance Policy and Motor Vehicles Act. In general as per motor vehicles act Total Loss means complete destruction of the vehicle beyond repairs and/or incapable of use. whereas as per Insurance CTL means the cost of repairs exceeds the 75% of IDV. So in my opinion the same can not be considered as the same. And further in CTL cases the Insurance Company or Insurance Surveyor is not legally responsible for the Sale of the Salvage or wreck of the vehicle. They only recommend the Insured the value of the wreck in as is where condition. He signs Form 29, Form 30 and sells the vehicle to the salvage buyer. If he is not interested to sell then he can retain the accident vehicle with him and agree for the settlement of the claim as recommended. Even though Insurance Company and Surveyor fix the value of the salvage they are not directly involved in the sale of the wreck/salvage. The Insured has option to sell or retain the vehicle. In Total Loss claims where vehicle is damaged beyond repairs, and incapable for use, or vehicle lost, completely burnt cases the case has to be settled on only Total Loss Basis only after surrendering Registration Certificate and Tax Card. etc., "TOTAL LOSS" and "CONSTRUCTIVE TOTAL LOSS" words need careful interpretation. This is my opinion. Thanking you

On Sat, Aug 4, 2012 at 12:15 PM, Prajith kumar.I.P <ippr...@gmail.com> wrote:

Dear Sir, In this matter our IIISLA Presdent earlier requested the IRDA, Insurers & Surveyors to stop Cash loss, Salvage loss settlement, etc, I would like know the response  received from them.     Thanks & Regards, Prajith kumar.I.P.

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[NARESH K TAGOTRA]

Dear Anoop Kumar & Others,

The insurers are not merely insisting for submission of assessment on net of salvage basis only in addition to other modes of assessment,but insisting on submitting quotes from some buyers.

This implies that surveyor comes in contact with the salvage buyers directly and in general are sending mail messages to few known buyers of the area. The investigation agency may doubt that why some select persons had been contacted and may doubt that the surveyor and buyer may have some relation.

Such is situation did not exist in past when the surveyors were not required to give quotes of buyers and had only to give there valuations and the disposal was solely being conducted by the insurers themselves. The insurers had been using proper means like calling tenders and advertising in local newspapers  and of late had been using e auction and e tendering,but the said process got diluted and concept of net of salvage ( Though in actual the salvage not being retained by the insured in maximum number of cases and sale being facilitated by the surveyor with consent of the insurers) became popular and that so with the introduction of private insurers. Thus had savings on garaging, advertisement, watch and ward costs etc. The surveyors too in present situation for getting few more jobs ,are doing extra job in salvage disposal as in present situation denial of same could lead to far less jobs.

Some of our surveyors even became total loss claims specialists as they could find salvage buyers easily with very good quotes, whereas others failed as they could either not find any good quotes and even in some cases value not upto the value of salvage recommended by them themselves in report. This meant that they become preferred surveyors of the insurers as the settlements could be done speedily without hassle and with lower liabilities.

Collective solutions need to be worked out . Such discussions though cause fear among surveyors but it is better to face the fears and find solutions than to .........

With warm regards

NARESH K TAGOTRA

www.isalvageauction.com

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[S. Anoop Kumar]

Dear Sir,

 

Excellent write up on dealing with the wreck of total loss vehicles.   Thanks for sharing the info.   But the insurance companies would not like to cancel the RC of the severely damaged vehicle, even when they are beyond economical or justified scope of repairs, including completely destroyed vehicles.    All in the name of getting some extra realised value in terms of salvage/wreck and in order to minimise the value of loss or claim outgo.  

 

This has to be seriously thought of on all India level by all senior surveyors handling motor claims and we should try to put a stop to it.   In our own interest and in the interest of safety of several other road users.   Use of such unsafe vehicles would result in more claims both in the form of Motor OD and Motor TP claims and resultant losses.   

 

Regards,

 

S. Anoop Kumar. 

 

 

----- Original Message -----

From: Anil Jauhri

To: iiisl...@googlegroups.com

Sent: Monday, August 06, 2012 12:16 AM

Subject: Re: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors

Dear Sir,
Pls go through my view point on `Net of Salvage' once fomed
Thanks
Anil Jauhri
Kanpur

On Sun, 05 Aug 2012 22:18:30 +0530 wrote

>






Dear Mr. Rajaram Rao & others,


An insurance policy is a
contract between two parties.It is not the law.But
MV Act is the law. And any contract should be within the framework
of the law of the land. The conditions in the policy are
designed to facilitate just and fair settlement in the event of a claim
arising. The definitions of 'Total Loss' and/or 'Constructive
Total Loss' (TL/CTL) are given to give a direction and clarity as to
at which point of time or level a damaged vehicle can be declared as TL or
CTL. And as surveyors handling the claim it is for the surveyor to
establish or prove that the damaged vehicle qualifies to be a case for

TLor CTL. The IMT states - "A vehicle will

be considered to be a CTL, where the aggregate cost of retrieval and / or repair of the vehicle subject to terms and
conditions of the policy exceeds 75% of the IDV."


As for as the Motor Policy is
concerned, condition 3 is reading as below:

The Company may at its own option repair reinstate or replace the vehicle or part thereof
and/or its accessories or may pay in cash the amount of the loss or damage and
the liability of the Company shall
not exceed:

(a) for total loss / constructive
total loss of the vehicle - the
Insured's Declared Value
(IDV) of the vehicle (including accessories thereon) as specified in the Schedule
less the value of the
wreck.

(b) for
partial losses, i.e. losses other than Total Loss/Constructive Total Loss of the
vehicle - actual and reasonable costs of repair and/or
replacement of parts lost/damaged subject to depreciation as per limits
specified.

Like I stated earlier, an insurance
policy is a contract between two parties and not the law. And
the policy contract here is clearly one-sided loaded in favour of the insurance
company and the insured does not have any choice or power to

negotiate,seek and/or demand any amends/changes.

It is for the surveyor to declare
whether the damaged vehicle qualifies to be declared as a case for TL or CTL
while following the policy conditions but within the confines of the law of the
land prevailing. By declaring any vehicle as a case for Total
Loss, the surveyor is also implying and/or clearly declaring/certifying that the

damaged vehiclehas been rendered permanently incapable of use.

Hence, it is prudent on the part of the surveyor

to recommend to the insurance company to treat thedamaged vehicle as Total

Loss and advise them to call for cancellation of RC by the insured and sell the
value of wreck or deduct the value of wreck but without vehicle
documents.


But what a motor surveyor is doing is
he is scouting the market to locate a salvage buyer who is prepared to give best
& highest value for the wreck complete with documents, introducing the
salvage buyer to the insured, facilitating the sale of wreck with documents -
all with clear knowledge and permission of the insurer's.

Thus the surveyoris clearly
becoming a party to some illegal activity and a crime.And it

is easy for the insurer's to quote the survey report & surveyor's
recommendations as a legal document resulting in settlement of a claim (citing
64UM of Insurance Act) and wash their hands off leaving the surveyor to defend
himself. Also the insured would only point his finger towards the
surveyor who negotiated the deal with the salvage buyer, who introduced the
salvage buyer and facilitated the sale transaction of the wreck/damaged

vehicle. Hence, it is the insurance surveyorwho is highly

vulnerable and clearly at the receiving end with no support coming from any
end.


This is what exactly happened in the
case of Jalandhar and Chandigarh car theft claims where one of our senior
surveyor colleague has been arrested, served jail sentence for more than 40 days

as an under-trial, nowout on bail, buthe is still fighting the case
in the criminal court facingserious criminal charges.

Another surveyor from MP is also reported to have been arrested, now in jail

asan under-trialand is still trying for bail in a similar
case. Are thesenot enoughevidences for us to

realise the seriousness of the matter and things in store for us (motor
surveyors) in the times to come.


Hence, in my personal opinion, as a
motor surveyor, we should give assessment figures on repair loss basis, and
likely realisable value on wreck without vehicle documents in the event of TL or
CTL and also quote Section 55 of MV Act in the report to safeguard our own
position. And allow the insurance company to take final decision as
to disposal of wreck and settlement of claim.



More views from senior motor
surveyors requested. I also invite Mr. BD Mohta and Mr. Atul Datt
(though not motor surveyors) to share their views on the finer legal points and

onthe position & role of insurance surveyors in the given

[S. Anoop Kumar]

Dear Atul Datt Sir and Mr. Naresh Tagotra Sir,

 

 

Thanks for sharing the info and concern.   Here the problem is not in low realisation on value of wreck.   Infact the value that is being realised on wreck on motor claims is clearly on the high side.  Very high side.   But only when sold along with the vehicle documents.   Even for vehicles that are damaged severely and or even destroyed.  But you just remove the RC and other vehicle documents, the value on wreck gets reduced to the value of scrap by weight of steel.  

 

 

For instance, let us talk about a Toyota Innova car of 2011 model car involved in an accident, a frontal collusion, and very severely damaged.    The IDV would be around Rs. 11.00 lakhs app.    Let us consider that the body shell (partially damaged on the front end and upto 2 front doors & still reparable), chassis frame, front suspension, steering, engine and related parts, dash board & related parts, etc. are damaged.   The estimate of repairs would be around Rs. Rs. 14.00 - Rs. 15.00 lakhs.   The cost of repairs would work out to Rs. 12.00 lakhs app and the nett liability would work out to Rs. 09.00 lakhs app.   This is a clear case for CTL.   The gross weight of the vehicle is around 2200 kgs. app.   Without the vehicle documents, the value of wreck I would realise would be around Rs. 44,000.00 to Rs. 50,000.00 or Rs. 60,000.00 at best.  

 

 

But for the same damaged vehicle, with complete clean vehicle documents, the value quoted by the buyers would be at astonishing Rs. 05.00 to 06.00 lakhs amidst severe competition.   This is clearly 10 times.   This explains the seriousness of the problem we are now discussing. 

 

 

In the case of Chandigarh car theft claims, for every one severely damaged total loss vehicle sold as wreck with RC, a similar vehicle got reported stolen from different parts of North India and the documents of the total loss vehicles were used to sell these stolen vehicles.   

 

 

How do we protect & insulate ourselves from getting into problems and still do business with insurance companies, who in the name of reducing the claim out go, are reluctant to get the RC's cancelled, barring Oriental Insurance Co. Ltd.?    Even if it is in clear violation of Section 55 of MV Act.   The various sections of IPC under which criminal charges can be framed against a surveyor are too severe & too damaging to be dealt with and to live with.  

 

 

1.120 (B) - Punishment of criminal conspiracy
2. 201 - Causing disappearance of evidence of offence, or giving false information to screen offender
3. 411 - Dishonestly receiving stolen property
4. 420 - Cheating and dishonestly inducing delivery of property
5. 467 - Forgery of valuable security, will, etc.
6. 468 - Forgery for purpose of cheating
7. 471 - Using as genuine a forged document
8. 473 - Making or possessing counterfeit seal, etc., with intent to commit forgery punishable otherwise
9. 474 - Having possession of document knowing it to be forged and intending to use it genuine
10.489 - Tampering with property mark with intent to cause injury

 

Read the respective IPC sections to know the severity of the crimes against the relevant sections and the punishments prescribed.  

 

 

This matter should be seriously taken up with Ministry of Surface Transport, Ministry of Finance (Department of Insurance), IRDA, GI Council, and Ministry of Home Affairs.   

 

 

Regards,

S. Anoop Kumar.    

 

          

----- Original Message -----

From: Atul Datt

To: insurance-su...@googlegroups.com

Cc: Insurance Adjusters ; S. Anoop Kumar

Sent: Sunday, August 05, 2012 10:33 PM

Subject: Re: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors

Dear friends,

 

The difficulties related to salvage disposal are faced by Motor Surveyors and non-Motor Surveyors alike. It is best to adhere to CVC rules in such matters, so that one’s conduct does not become suspect during a subsequent investigation. These rules are available on the CVC website and are not very tedious to follow, though slightly time consuming. However, given the current imperatives, it is worthwhile to follow them.

 

Best Regards,

 

ATUL  DATT

SLA, New Delhi

9810058885  

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[NARESH K TAGOTRA]

Dear Mr. Anoop Kumar & others,

Lets discuss the points raised by you first and will add more as another perspective on the subject with new subject line will be posted shortly. The intention is to discuss the same thread bare.

As given in your own case study of innova vehicle, if the same vehicle is repaired in the local workshop with more use of repairs and least replacements as generally done in such case the reparis cost will be around 2.00 lacs and thereby viability of salvage value of 4 to 5 lacs may get quoted provide the resale value is above after repairs is around 9.5 to 10 lacs.This could be case where a genuine buyer buys the salvage and repairs it and then resells the same. All surveyors know that it is practical and being done in most of the cases and vehciel are again insured after due inspections. Let us make it more realistic in this situation only, lets say that after a estimate of 15.00 lacs and case being non cashless setup, the insured himself saying that he does not wants to get the vehicle reparied at authorised workshop and shift the vehcile to some local workshop for repairs. All surveyors will agree that the liability will be definately be far less than the total loss situation and will be easily settled on repairs basis. The culprit here is not the authorised workshop but the standard of repairs wherein stress is on replacement of parts for quality standards. You will agree that as surveyor if we live in fear and become prejudiced towards the mode of settlement, the same will be surely a loss to the nation ultimately and thereby finding solution is of utmost importance. Even all settlements without Rc will not gurantee that some one may use the parts or the salvage in some other unlawful activity and another pandora box may get opened.

I like to draw the attention of faternity to another point that one will observe that in case of major losses the estimate will be anywhere from 150% TO 200% the cost of vehicle itself. In case of new vehicle you will find the same across all the make and models of vehicles. Theis is the biggest grey area which has remained undiscussed. The CTL cases are becasue of this major factor and the said domain is in sole control of the manufacturers and no one can or has questioned them about the same.

Your suggestion to take up the matter with Govt bodies .... need rethinking. Firstly the guidelines are there for the insurers as rightly pointed by Mr. atul datt. vide the CVC guidelines. The brief stress given for disposal of savage is that the sale should be made transparent through tender or auction and further that after the close of tender/auction the negotiations further can only be done with L1 and none else.

Regarding problem of surveyors ... the same is due to there involvement in the disposal and they not showing transpancy. in such deals. The surveyors should either not get involved in coming in contact with the buyers and restrict themselves to the valuation level only and let the insuers proceed further or they have to use fair open and transparent means of such disposal or seeking quotes.

Regarding OIC.. they have kept the surveyors out of role of salvage disposal which is welcome. I still doubt that they are selling all the salvage without RCs but definately are using the services of MSTC in disposal of salvage through e auctions. 

With regards

NARESH K TAGOTRA

 www.isalvageauction.com

[bipin saluja]

I , to some extent agree with Godboles version. But, Total Loss is an irksome process i.e surrendering the R/C and auctioning the Sacrp. Further the scrp Buyers (Kabari) will sell the parts of the Total Loss vehicle  in the local market. Hence Net of Salvage settlement with cancellation of Policy should be preferred. BIPIN SALUJA --- On Sat, 4/8/12, Vasant Godbole <vasant_go...@yahoo.com> wrote:

[S. Anoop Kumar]

Dear Friends,


An important issue was raised as to cancellation of RC in the event
of
TL/CTL vehicles and several surveyors shared their opinions and
comments. But surprisingly many of the senior surveyors in the
Motor
Department have kept away or shied away from participating in the
debate or discussion and in sharing their valuable opinions which
would have helped our surveyors in the B & C categories to get to
learn as to how to deal with such claims.


Next, I did not find many C & B category motor surveyors
participating
in the discussion. Perhaps they thought that the issue does not
really pertain to them. They are totally wrong. The issue can
come up even for two wheeler or 3 wheeler claims, where the RC can be
misused. Just think RC of a Total Loss two wheeler used for
selling
a theft vehicle and such vehicle is recovered from a criminal or even
a suspected or confirmed terrorist.


Further, none of the insurance officials shared their opinion or views
from the insurer's point of view.


I think we can now conclude the discussion as under:


1. In the event of TL/CTL of a vehicle under claim, the surveyor
would indicate the likely realisable value on the wreck both with RC
and after cancellation of RC and leave the final decision to the
insurer's.


2. The surveyor would make a mention as to the provisions of law,
that is section 55 of MV Act, in his report to safeguard his own
position.


3. The surveyor will not involve himself in sale of wreck or in the
sale transaction and would forward the offers received from salvage
buyers for the evaluation and final decision of insurer's.


4. Some of the senior surveyors and also IIISLA should take up the
matter seriously with Ministry of Surface Transport, Ministry of

Finance (Department of Insurance), IRDA, GI Council, and Ministry of
Home Affairs.


Regards,
S. Anoop Kumar.

> > *From:* Atul Datt <ad...@matrixworld.biz>
> > *To:* insurance-su...@googlegroups.com
> > *Cc:* Insurance Adjusters <Insurance...@googlegroups.com> ; S.
> > Anoop Kumar <s.anoopku...@gmail.com>
> > *Sent:* Sunday, August 05, 2012 10:33 PM
> > *Subject:* Re: Total Loss Vehicle claims - A pure technical discussion

> > for Motor Surveyors
>
> >  Dear friends,
>
> > The difficulties related to salvage disposal are faced by Motor Surveyors
> > and non-Motor Surveyors alike. It is best to adhere to CVC rules in such
> > matters, so that one’s conduct does not become suspect during a subsequent
> > investigation. These rules are available on the CVC website and are not
> > very tedious to follow, though slightly time consuming. However, given the
> > current imperatives, it is worthwhile to follow them.
>
> > Best Regards,
>
> > ATUL  DATT
> > SLA, New Delhi
> > 9810058885
>

> >  *From:* NARESH K TAGOTRA <tag...@gmail.com>
> > *Sent:* Sunday, August 05, 2012 9:25 PM
> > *To:* insurance-su...@googlegroups.com
> > *Cc:* Insurance Adjusters <Insurance...@googlegroups.com> ; S.
> > Anoop Kumar <s.anoopku...@gmail.com>
> > *Subject:* Re: Total Loss Vehicle claims - A pure technical discussion

> > for Motor Surveyors
>
> > Dear Anoop Kumar & Others,
>
> > The insurers are not merely insisting for submission of assessment on net
> > of salvage basis only in addition to other modes of assessment,but
> > insisting on submitting quotes from some buyers.
>
> > This implies that surveyor comes in contact with the salvage buyers
> > directly and in general are sending mail messages to few known buyers of
> > the area. The investigation agency may doubt that why some select persons
> > had been contacted and may doubt that the surveyor and buyer may have some
> > relation.
>
> > Such is situation did not exist in past when the surveyors were not
> > required to give quotes of buyers and had only to give there valuations and
> > the disposal was solely being conducted by the insurers themselves. The
> > insurers had been using proper means like calling tenders and advertising
> > in local newspapers  and of late had been using e auction and e
> > tendering,but the said process got diluted and concept of net of salvage (
> > Though in actual the salvage not being retained by the insured in maximum
> > number of cases and sale being facilitated by the surveyor with consent of
> > the insurers) became popular and that so with the introduction of private
> > insurers. Thus had savings on garaging, advertisement, watch and ward costs
> > etc. The
>

> ...
>
> read more »- Hide quoted text -
>
> - Show quoted text -

[Lakshman R.Iyer]

Dear Anoop,
We at Aurangabad enforced it more than 5 years ago, but to your surprise, the RTO agents managed to stamp the cancellation on RC without updating RTO records and later managed a Duplicate RC without RC cancellation.
In fact that was when the system was not computerises and only manual endorsements were passed on already existing RC.
I have adapted the practice of mentioning the following statement in my reports after the Punjab incidence.
Mention expected salvage value with and without RC( No quotations collected)
One Statement as follows "Subject to retain/disposal of salvage on assured's own account".
Sorry for communicating  a bit late.
Regards
Lakshman Iyer
Aurangabad

[javed malik]

As per the requirements of Insurance Act 2000 the surveyors are required not to be party in process of salvage disposal as by doing so they compromise their function as a surveyor and become prejudice one way the other. However they may take quotations to evaluate the salvage for the purpose of loss adjustment. In case of CTL claims against motor policy the surveyor adjust the loss by assessing the value of salvage and then the Insurance company concerned dispose off the salvage independently.

Other than what has been required under motor vehicle act, I have the opinion that the surveyor should not participate in salvage disposal process as it is the prerogative of the Insurers.

 

Further it is difficult to understand as to why a surveyor will be arrested by Indian Police after disposal of salvage on behalf of the Insurers. It is Insurer who collected the RC and other documents under right of subrogation from the Insured and advise the surveyor to dispose off the salvage. Matter should be taken up and settle through high court of India .

 

Thanks!

 

QAYYUM PERVEZ MALIK

PAKISTAN 

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[Lakshman Iyer]

Dear Brother,

The Salvage/ wreck disposal problem is only  because

1. Insurer's are practicing Right procedures  for the same- because of 12.36% service tax being charged on the trasaction which brings down the realizable Value of Salvage/ wreck which in turn adds to the liability on the Insurance Company.

Hence they resort to selling/ disposing of Wreck/ salvage outside their documentary per view and  the action is carried out as if Assured has done by taking a Declaration from him.

2. Secondly- The repair expenses calculated is based on  the presumption that  replacement spares used are New Ones, and arrive on amount exceeding 75% if IDV.
   Here the salvage buyers use recyclable/ repaired spares and( Again items from salvage of spares assessed in partial loss basis), which brings down the cost of repairs. That is why salvage buyers are interested in wreck with live RC.

The sad part is that none of the above parameters are under the control of surveyor and perview.

So instead of "Actions after" the preventive measures are more important.

Gentlemen please correct me if I am wrong.

Regards
Lakshman Iyer
Aurangabd.

On Saturday, August 4, 2012 9:28:47 AM UTC+5:30, S. Anoop Kumar wrote:

[KC.G...@nic.co.in]

Surveyor may avoid mediation of selling wreck. But many a times wreck value as assessed by the surveyor is not available to the claimant and insurers in order to settle the claim as assessed by the surveyor seek his help thus he comes in the picture.

A surveyor's job is not to dispose off salvage but conscious customers these days don't accept the salvage value more than they can realize. On the contrary in many cases claimants are interested in settlement of claim on net of salvage basis only. Here insurer expects surveyors to handle situation professionally and tactfully doing justice to both the parties.

As regards section 55 of NV Act which states that in case a vehicle becomes incapable to be used, the owner of the vehicle must get the RC cancelled, whereas while settling the claim on net of salvage basis it is presumed that the vehicle can be repaired and made useable. Only in case of total loss it is presumed that repair of the vehicle is not economical.

Unfortunately net of salvage method is seldom used violating its' spirit.  

With regards,

K.C GUPTA
Regional MANAGER,
National Insurance Company Ltd.,
Ahemadbad Regional Office,
Phone 079-26581031, IP-300000-204
Mobile -09909920049 (Gujrat), 09829028456 (Rajasthan)
National Insurance Company Ltd.

-----insurance...@googlegroups.com wrote: -----

To: insurance...@googlegroups.com
From: Lakshman Iyer
Sent by: insurance...@googlegroups.com
Date: 08/17/2012 10:15AM
Cc: Insurance Surveyors India <insurance-su...@googlegroups.com>, iiisl...@googlegroups.com, Insurance Adjusters <Insurance...@googlegroups.com>, "S. Anoop Kumar" <s.anoo...@gmail.com>
Subject: [Adjusters:12525] Re: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors

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[S. Anoop Kumar]

Dear Mr. Pervez Malik,

Few small corrections for your academic interest.

a. It is Surveyors Regulations 2000 which specifies the role and
functions of insurance surveyors. Our Insurance Act is of 1938 and
as last amended during 2002. Possibly even Pakistan would have
adopted Insurance Act 1938 (while under British India) and later
modified or amended it to suit the local needs of Pakistan.


b. Motor surveyors in India have been asked to and have been
participating in salvage disposal process in the event of total loss
of vehicles. We are now trying to protect ourselves.


c. A senior surveyor from Jullundur (Punjab) was arrested by
Chandigarh Police for having facilitated sale of wreck of total loss
vehicle for the Regn. Certificate of such total loss vehicle was used
by the salvage buyer to sell another theft vehicle. He spent 42 days
in Jail as an accused during last year later released on bail. The
surveyor is still fighting the case in the court facing serious
criminal charges. He is clearly on his own.


d. The states of India have High Courts, called as High Court of
State, normally located at the state capitals of the respective
states. And we have Supreme Court, the highest judicial body for the
country, called as Supreme Court of India.


Regards,
S. Anoop Kumar.

On Aug 16, 7:33 pm, javed malik <jqma...@gmail.com> wrote:
> As per the requirements of Insurance Act 2000 the surveyors are required
> not to be party in process of salvage disposal as by doing so they
> compromise their function as a surveyor and become prejudice one way the
> other. However they may take quotations to evaluate the salvage for the
> purpose of loss adjustment. In case of CTL claims against motor policy the
> surveyor adjust the loss by assessing the value of salvage and then the
> Insurance company concerned dispose off the salvage independently.
> Other than what has been required under motor vehicle act, I have the
> opinion that the surveyor should not participate in salvage disposal
> process as it is the prerogative of the Insurers.
>
> Further it is difficult to understand as to why a surveyor will be arrested
> by Indian Police after disposal of salvage on behalf of the Insurers. It is
> Insurer who collected the RC and other documents under right of subrogation
> from the Insured and advise the surveyor to dispose off the salvage. Matter
> should be taken up and settle through high court of India .
>
> Thanks!
>
> QAYYUM PERVEZ MALIK
> PAKISTAN
>
> On Sat, Aug 11, 2012 at 8:58 AM, Lakshman R.Iyer

> <lakshmaniyer...@yahoo.com>wrote:

>
>
>
> > Dear Anoop,
> > We at Aurangabad enforced it more than 5 years ago, but to your surprise,
> > the RTO agents managed to stamp the cancellation on RC without updating RTO
> > records and later managed a Duplicate RC without RC cancellation.
> > In fact that was when the system was not computerises and only manual
> > endorsements were passed on already existing RC.
> > I have adapted the practice of mentioning the following statement in my
> > reports after the Punjab incidence.
> > Mention expected salvage value with and without RC( No quotations
> > collected)
> > One Statement as follows "Subject to retain/disposal of salvage on
> > assured's own account".
> > Sorry for communicating  a bit late.
> > Regards
> > Lakshman Iyer
> > Aurangabad
>
> > On Saturday, August 4, 2012 9:28:47 AM UTC+5:30, S. Anoop Kumar wrote:
>
> >>  Dear Friends,
>
> >> As per section 55 of MV Act, for all vehicles which are destroyed or
> >> rendered incapable of use the RCs need to be cancelled.  I am reproducing
> >> the relevant section below:
>

> >>  ------------------------------

> >>  55. Cancellation of registration.
>
> >> (1) If a motor vehicle has been destroyed or has been rendered
> >> permanently incapable of use, the owner shall, within fourteen days or as
> >> soon as may be, report the fact to the registering authority within whose
> >> jurisdiction he has the residence or place of business where the vehicle is
> >> normally kept, as the case may be, and shall forward to the authority the
> >> certificate of registration of the vehicle.
>
> >> (2) The registering authority shall, if it is the original registering
> >> authority, cancel the registration and the certificate of registration, or,
> >> if it is not, shall forward the report and the certificate of registration
> >> to the original registering authority and that authority shall cancel the
> >> registration.
>
> >> (3) Any registering authority may order the examination of a motor
> >> vehicle within its jurisdiction by such authority as the State Government
> >> may by order appoint and, if upon such examination and after giving the
> >> owner an opportunity to make any representation he may wish to make (by
> >> sending to the owner a notice by registered post acknowledgment due at his
> >> address entered in the certificate of registration), it is satisfied that
> >> the vehicle is in such a condition that it is incapable of being used or
> >> its use in a public place would constitute a danger to the public and that
> >> it is beyond reasonable repair, may cancel the registration.

> >>  ------------------------------

> >http://groups.google.com/group/insurance-adjusters?hl=en-GB.- Hide quoted text -

[S. Anoop Kumar]

Dear Mr. KC Gupta,


Thanks for participating in the discussion and for sharing your
views.


Clearly all the insurance companies (barring The Oriental Insurance
Company Limited) are settling all Total Loss or Constructive Total
Loss Vehicle claims on Nett of Salvage Basis and invariably the
concerned surveyor is made to locate the salvage buyers offering the
highest and best value for the wreck complete with all vehicle
documents.


The value of wreck minus the vehicle documents would fetch nothing
more than the scrap value by weight. And erosion in the value of
wreck could be as much as 90 %. That is if the value of wreck of a
particular total loss vehicle with all documents would fetch, say Rs.
500,000.00 (Rupees Five Lakhs only), the same wreck without vehicle
documents would fetch no more than Rs. 50,000.00 (Rupees Fifty
Thousands only). And none of the insurer's are prepared to accept
such erosion in the wreck value for it would increase their claim
outgo amount.


Even in the case of very severely damaged vehicles or completely
destroyed vehicles, such as fire burnt and destroyed vehicles, the
wreck is still sold with the vehicle documents. And everyone knows
what is happening next. The vehicle documents are used for selling
some other older model vehicles or recontructed vehicles using all
disposal parts, or even for selling stolen vehicles. In such an
event, a surveyor who has facilitated the sale of wreck is culpable of
the grave crime.


As a surveyor, I dread & shudder even to think of the serious
consequences if the vehicle documents of some total loss vehicle are
used to sell some stolen vehicle or some other reconstucted vehicle
and used for some anti-national activity which later is seized by the
police from some terrorist outfit. Clearly, everything would be
finished for the surveyor. And even insurance company officials may
not escape the long hands of the law that time. For such sale of
wreck or settlement of claim could not have taken place without the
prior approval of the insurer's and in most cases there is an interim
report filed by the surveyor which is approved by the insurer's.


It is the insurance companies who have to take the policy decision (as
taken by OICL) to cancel the RC of the Total Loss vehicles. Or else
just wait for unexpected to happen.


With best regards,

S. Anoop Kumar,
Surveyor,
Hyderabad.
09849042132.

On Aug 17, 10:09 am, KC.Gu...@nic.co.in wrote:
> Surveyor may avoid mediation of selling wreck. But many a times wreck value as assessed by the surveyor is not available to the claimant and insurers in order to settle the claim as assessed by the surveyor seek his help thus he comes in the picture.
> A surveyor's job is not to dispose off salvage but conscious customers these days don't accept the salvage value more than they can realize. On the contrary in many cases claimants are interested in settlement of claim on net of salvage basis only. Here insurer expects surveyors to handle situation professionally and tactfully doing justice to both the parties.
> As regards section 55 of NV Act which states that in case a vehicle becomes incapable to be used, the owner of the vehicle must get the RC cancelled, whereas while settling the claim on net of salvage basis it is presumed that the vehicle can be repaired and made useable. Only in case of total loss it is presumed that repair of the vehicle is not economical.
> Unfortunately net of salvage method is seldom used violating its' spirit.
>
> With regards,
>
> K.C GUPTA
> Regional MANAGER,
> National Insurance Company Ltd.,
> Ahemadbad Regional Office,
> Phone 079-26581031, IP-300000-204
> Mobile -09909920049 (Gujrat), 09829028456 (Rajasthan)
> National Insurance Company Ltd.
>
> -----insurance...@googlegroups.com wrote: -----
>
> To: insurance...@googlegroups.com
> From: Lakshman Iyer
> Sent by: insurance...@googlegroups.com
> Date: 08/17/2012 10:15AM

> Cc: Insurance Surveyors India <insurance-su...@googlegroups.com>, iiisl...@googlegroups.com, Insurance Adjusters <Insurance...@googlegroups.com>, "S. Anoop Kumar" <s.anoopku...@gmail.com>

> Subject: [Adjusters:12525] Re: Total Loss Vehicle claims - A pure technical discussion for Motor Surveyors
>
> Dear Brother,
>
> The Salvage/ wreck disposal problem is only  because
>
> 1. Insurer's are practicing Right procedures  for the same- because of 12.36% service tax being charged on the trasaction which brings down the realizable Value of Salvage/ wreck which in turn adds to the liability on the Insurance Company.
>
> Hence they resort to selling/ disposing of Wreck/ salvage outside their documentary per view and  the action is carried out as if Assured has done by taking a Declaration from him.
>
> 2. Secondly- The repair expenses calculated is based on  the presumption that  replacement spares used are New Ones, and arrive on amount exceeding 75% if IDV.
>    Here the salvage buyers use recyclable/ repaired spares and( Again items from salvage of spares assessed in partial loss basis), which brings down the cost of repairs. That is why salvage buyers are interested in wreck with live RC.
>
> The sad part is that none of the above parameters are under the control of surveyor and perview.
>
> So instead of "Actions after" the preventive measures are more important.
>
> Gentlemen please correct me if I am wrong.
>
> Regards
> Lakshman Iyer
> Aurangabd.
>
> On Saturday, August 4, 2012 9:28:47 AM UTC+5:30, S. Anoop Kumar wrote:
>
> Dear Friends,
>
> As per section 55 of MV Act, for all vehicles which are destroyed or rendered incapable of use the RCs need to be cancelled.  I am reproducing the relevant section below:
>

> 55. Cancellation of registration.
>
> (1) If a motor vehicle has been destroyed or has been rendered permanently incapable of use, the owner shall, within fourteen days or as soon as may be, report the fact to the registering authority within whose jurisdiction he has the residence or place of business where the vehicle is normally kept, as the case may be, and shall forward to the authority the certificate of registration of the vehicle.
>
> (2) The registering authority shall, if it is the original registering authority, cancel the registration and the certificate of registration, or, if it is not, shall forward the report and the certificate of registration to the original registering authority and that authority shall cancel the registration.
>
> (3) Any registering authority may order the examination of a motor vehicle within its jurisdiction by such authority as the State Government may by order appoint and, if upon such examination and after giving the owner an opportunity to make any representation he may wish to make (by sending to the owner a notice by registered post acknowledgment due at his address entered in the certificate of registration), it is satisfied that the vehicle is in such a condition that it is incapable of being used or its use in a public place would constitute a danger to the public and that it is beyond reasonable repair, may cancel the registration.
>

> A senior surveyor from North India was arrested during last year by Chandigarh Police for facilitating sale of wreck of total loss vehicles, the RCs of which have been misused by the salvage buyers and used for selling stolen vehicles.   Some more surveyors from MP, UP, Delhi, AP, Karnataka, Kerala, Tamilnadu, etc. also came under scanner of police officials for facilitating sale of wreck of total loss vehicles.  Police are also investigating the role of insurance officials and also other surveyors from all over India and are trying to establish the nexus between the insurance officials, surveyors, salvage buyers and auto theft gangs.   This would prove to be very damaging to the reputation of the Motor Surveyors who are trying to the reduce the loss on insurance claims.
>
> It is suggested Total Loss Vehicles be settled on Total Loss Basis subject to the RC getting cancelled by the insured.  Oriental Insurance has been following this mode of claim settlement for the past 3-4 years in order to avoid complications at a later date and getting implicating in vehicle theft crimes.
>
> More views and opinions from members invited.
>
> With best regards,
> S. Anoop Kumar.
>
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