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BIHAR STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, PATNA
Honble Mr. Justice B.N. Sinha, President; Mr. K.P. Sinha, Member
M/s. MONA SILK—Complainant
versus
NATIONAL INSURANCE CO. LTD.—Opp. Party
Complaint No. 12 of 1991—Decided on 5.2.1993
For the Complainant :Mr. Harendra Nr. Sinha, Advocate.
For the Opp. Party :Mr. Manoranjan Kr. Sinha & Mr. R.C.L. Das, Advocates.
An Insurance Company is liable for the delay in claim settlement due to negligence and must compensate the insured for the loss suffered.
Headnote:
BURGLARY INSURANCE - CLAIM SETTLEMENT - DELAY - NEGLIGENCE - INSURANCE COMPANY'S LIABILITY - SURVEYOR'S REPORT - UNDER INSURANCE - CALCULATION OF CLAIM AMOUNT - INTEREST - BUSINESS LOSS - COMPENSATION.
Fact of the Case:
Complainant, M/s. Mona Silk, filed a complaint against the National Insurance Company Limited for non-settlement of their claim under the Burglary Insurance Policy. A theft occurred in the insured premises on the night of 28th and 29th September 1989. The complainant lodged an FIR and informed the Insurance Company. Two Surveyors were appointed to assess the loss. The first Surveyor submitted a report on 30.9.89, recommending compensation for the theft. However, the second Surveyor submitted a report on 15.4.91, reducing the claim amount due to under insurance. The complainant contended that the delay in claim settlement was due to the negligence of the Insurance Company and claimed compensation for the loss suffered.
Finding of the Court:
The State Commission held that the Insurance Company was liable for the delay in claim settlement due to negligence. The Court found that the second Surveyor's report was not justified as the claim amount was not colossal compared to the insured value. The Court also held that the Insurance Company did not take due interest in obtaining the Surveyor's report promptly, which resulted in financial losses to the complainant.
Issues: 1. Whether the Insurance Company was liable for the delay in claim settlement? 2. Whether the second Surveyor's report was justified in reducing the claim amount? 3. Whether the complainant was entitled to compensation for the loss suffered?
Ratio Decidendi: 1. The Insurance Company was liable for the delay in claim settlement due to negligence. The Court found that the second Surveyor's report was not justified as the claim amount was not colossal compared to the insured value. The Court also held that the Insurance Company did not take due interest in obtaining the Surveyor's report promptly, which resulted in financial losses to the complainant. 2. The second Surveyor's report was not justified in reducing the claim amount. The Court found that the claim amount was not colossal compared to the insured value and that the second Surveyor had not fully applied his mind to the matter. 3. The complainant was entitled to compensation for the loss suffered. The Court awarded compensation of Rs. 10,000/- to the complainant over and above the claim amount.
Final Decision: The State Commission directed the Insurance Company to pay the complainant a total amount of Rs. 1,12,612.00 within three months from the date of the order.
Mr. K.P. Sinha, Member— This is a complaint filed by M/s. Mona Silk, Burha Nath Road, Bhagalpur (hereinafter referred to as the complainant) against the National Insurance Company Limited, Bhagalpur Branch (hereinafter referred to as the O.P.) for non settlement of their claim under the Burglary Insurance Policy No. 7502200 of 1989-90 in respect of theft of silk fabrics and silk yarns, committed in the night of 28th and 29th September, 1989 from the insured premises of the complainant. An FIR about the above theft was lodged with the Kotwali Police Station who registered Bhagalpur Kotwali P.S. Case No. 607 dated 29.9.89 for the above theft. On 29th September itself the Branch Manager of the National Insurance Company was informed about the incident of theft. A Surveyor was deputed by the Insurance Company who visited the premises and collected relevant informations. Subsequently on 24th October, 1989 another Surveyor of the National Insurance Company visited the insured premises and again collected detailed information of the incident as well as the total stock position since l.4.89 till the date of occurrence i.e. till 28.9.89. The police after completing the investigation submitted final report on the complaint made by the complainant as "Case true-no clue " u/Sec. 457/ 380 of the Indian Penal Code. This final report of the police was accepted by the Chief Judicial Magistrate. It is alleged by the complainant that in spite of above facts several rejoinders, telephonic talks and personal visits of the complainant the Insurance Company did not take any decision in the matter of his claim relating to that the Burglary Policy No. 7502200 taken by the complainant from the Opp Party which was valid till 28th June, 1990. The complainant has, therefore, claimed a total sum of Rs. 1,92,667.50 against the O.Ps. comprising of the following items:—
(a) The amount representing the value of goods stolen at Rs. 77,667.50
(b) Compound interest charged by the Bank on the claimed amount at Rs. 25,000.00
(c) Estimated business loss suffered for 18th months @ Rs. 5000/- per month Rs. 90,000.00
Total:— Rs. 1,92,667.50
2. In the written statement filed on behalf of the National Insurance Company in connection with the above allegations of the complainant it has been mentioned that there was no proof of any delibrate latches or harassment by the Insurance Company and they deputed a Surveyor to the spot to assess the loss immediately on the receipt of information with regard to the theft. The Surveyor was to asses the loss on spot and quantified the damage if any. On receipt of the report from this Surveyor the O.Ps. again entrusted the job to another Surveyor to investigate the matter and assess the actual loss in terms of the policy of contract. It is contended by the O.Ps. that on submission of his detailed report the claim was found to be exaggerated and non-standard and that the incident of theft was also not proved beyond all reasonable doubt and the incident has been narrated to have occurred in a very suspicious manner casting aspersion on the veracity of the statement. The actual loss was assessed by the Surveyor at Rs. 34,935/-. It has also been contended in the written statement that the complainant was a Commission Agent and not the owner of the property said to be stolen. This contention has been made in view of the observations made in the report of the Second Surveyor. It has further been contended by the O.Ps. that in case of any dispute with regard to the question of the claim the matter shall have to be referred for arbitration and further that since the claim has been repudiated the complainant could only take recourse to instituting money claim before a competent Civil Court and, therefore, it has been prayed that in the light of these facts the complaint should be dismissed on ground of maintainability as well as on facts.
3. In reply to these contentions made in the written statement of the O.Ps. rejoinder has been filed in wh
