Patna, Nov. 29: The State Consumer Disputes Redressal Commission has come down heavily on Oriental Insurance Company Limited for repudiating a genuine insurance claim.
The commission ruled that the grounds the company had put forward for indemnifying the loss on account of theft in a clothes shop are illegal and arbitrary.
The commission has also directed the company to pay a compensation of Rs 3.05 lakh to the shop owner.
“The insurance company failed to perform its duty towards the respondent (the cloth shop owner), who had paid premium for the risk insured by the company, though the incident took place within the validity of the insurance. By repudiating the case on illegal and arbitrary grounds, the company made the shop owner suffer monetary loss and mental harassment. So the insurance company is liable to indemnify the loss of Rs 3 lakh to the shop owner, as directed by the district forum,” the commission president, Justice S.C. Jha, said in his recent order.
Commission member Renu Sinha said: “The insurance company repudiated the claim of the respondent as “no claim” even after the loss assessed in the survey report by its own appointed surveyor made its own document invalid. At this stage, the company cannot take shelter of the said document, which they did not considered in the first place.”
“The district forum decided the matter on the basis of police report accepted by the chief judicial magistrate — a competent judicial authority — and cannot be challenged. So granting the awarded amount by the district forum is based on law and is justified,” said Sinha.
The commission has also upheld the district forum’s decision to award a compensation of Rs 10,000 for the mental harassment caused by the insurance firm to the shop owner.
The commission, however, accepted the insurance firm’s plea to modify the forum’s order of granting Rs 35,000 for a loss that was for Rs 5,000 only.
Unknown criminals looted the cloth shop of one Bipin Bihari on the night of April 22, 2004.
The shop owner had duly insured the shop for a period from March 3, 2004 to March 2, 2005 in shopkeeper insurance policy under burglary risk for a sum of Rs 7 lakh.
The shop owner lodged an FIR with the police station concerned wherein he stated that the loss of cloth worth Rs 3,00,000 and Rs 35,000 from the shop and also informed the same to the insurance company while requesting it to settle the claim accordingly.
But, the company appointed preliminary surveyor, Rajesh Kumar, who according to the shop owner, never visited the shop after the incident. Then, the company appointed another surveyor Kamlesh Kishore, who stated in his survey report to settle the claim for Rs 1,03,000, after which the shop owner approached the Patna High Court, which directed the company to get the matter surveyed and enquired according to law.
The company never send a surveyor as per the direction and ultimately the claim of the shop owner was repudiated on July 29, 2005 as “no claim”, the judgement noted.