IMPORTANT POINTS
(1) Insurance Policy - An insurance policy is a contract of insurance which has to be read as it is without any additions or other interpretations.
(2) Insurer - The insurer is required to consider the report of the surveyor appointed by it although he is not bound to accept the report in entirety.

ORDER

This consumer complaint under Section 21(a)(i) of the Consumer Protection Act, 1986 (in short, ‘the Act’) is filed alleging deficiency in service and seeking compensation with interest in respect of loss suffered on account of repudiation of a claim under two insurance policies issued by the opposite parties.

2. The facts of the case, in brief, are that the Complainant, M/s Hotel Leelaventure Ltd., Mumbai (a Five-Star Deluxe Hotel), claimed an amount of Rs.5,98,42,267/- as compensation along with punitive damages and costs, etc. from the opposite party (insurer) for the losses and damaged suffered to the properties of the complainant which were insured by the Insurer under two insurance policies for its buildings and items therein, due to unprecedented flash floods due to excessive rains and high tides in the sea in Mumbai on 26.07.2005 resulting in inundation/flooding of water into the premises of the Hotel thereby causing losses and damages to the insured buildings, plant & machinery and accessories, fixtures, fittings, furniture, etc. The complainant had intimated the incident of flood the same day, by letter dated 26.07.2005 followed by letter dated 11.08.2005, estimating loss of Rs. 4 crores. Complainant states that rain and sea water had flooded all the buildings by 6 inches to 2½ ft. in the building premises and up to ceiling in the basement. The Initial Report dated 13.09.2005 issued by Shri Adarsh K. Gupta, Surveyor for Adarsh Associates from New Delhi, after due inspection, investigation and verification of records estimated the loss at Rs.5 crores. A Claim Bill dated 03.07.2006 for Rs.6,91,93,420/- was sent by the Surveyor which was accepted and signed by opposite party no. 2. However, the Final Survey Report dated 12.07.2006 reduced the losses/damages to Rs.4,19,99,497/-. The Final Survey Report observed that the location of risk and description of risk when read together indicated that onlydamaged stock located within the insured premises i.e. Hotel Leela would be covered by the Fire Policy. Stock located at any other places including, Leela Galleria and its basements, cannot come within the scope of coverage as they fall outside the scope of the “insured premises”. It is alleged that the opposite parties (insurer) suppressed the Final Survey Report for 21 months and it was furnished to the complainant after repeated requests on 07.04.2008. The opposite parties meanwhile offered the complainant a ridiculously low compensation, fixed arbitrarily, unreasonably, unfairly and unjustly at Rs.37.57 lakhs on 26.12.2006, which was rejected by the complainant. The complainant avers that they paid premium of Rs.22 lakhs approximately and suffered a loss of about Rs.6 crores while the opposite party had offered a petty compensation of Rs.37.57 lakhs without assigning any reason, in violation of principles of natural justice. Alleging deficiency in service on the part of the insurance company and its officers in settlement of the claim of loss of the complainant, he is before this Commission with the following prayer:—

(a) That the records of “the insurer”, Opposite Party No. 1 (Govt. of India Undertaking) relating to this case be called for.

(b) That it be held that there are several instances of deficiency of service in the performance of “the insurer”.

(c) That “the Insurer”, Opposite Party No. 1 be directed to pay to the Complainant, compensation of Rs.5,98,42,267/- as estimated by the Surveyor, Sh. Atul C. Shah, appointed by the Complainant, meanwhile, interim Order u/s 13 (3B) for grant of Rs.5 Crores.

(d) That “the Insurer” be directed to pay to the Complainant, interest on the above said amount @ 15% p.a. from the date of the loss viz. 26.07.2005 till the date of the actual payment.

(e) That “the Insurer” be directed to pay to the Complainant an amount of Rs.50 lakhs towards punitive damages for harassment, mental agony, pain and sufferings and loss of business caused by “the Insurer” and its officers a