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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
A.P. Sahi, President
Nissan Enterprises Limited – Complainant
versus
National Insurance Company Ltd. – Opp. Party
Consumer Case No.586 of 2015
Decided on 16.2.2024
Consumer Protection Act, 1986 – Section 21(1)(a)(i) [Consumer Protection Act, 2019 – Section 58(1)(a)(i)] – Services – Insurance – Repudiation of Claim – When justified – It is however true that the Insurance Company repudiated the claim only after the filing of the present complaint and to that extent learned counsel for the complainant is correct in her submissions that delay was caused in the final decision making process by the Insurance Company – Thus, it is admitted to the complainant that it had neither obtained nor submitted any structural analysis report of the building in question. It is also evident that on the date of the collapse, the second floor was also being constructed about which doubts had been expressed with regard to their appropriate sanction by the competent authority – Thus, the fact that the constructions were going on at the second floor and the building was being loaded with additional structure has not been disputed. This overloading of the structure which already had a weak structural construction in all probability might have caused the sinking of the building – On facts, complainant has not been able to dislodge the exclusion invoked by the Insurance Company, the repudiation cannot be faulted with. Hence, there is no deficiency in service on the part of the Insurance Company in repudiating the claim – Complaint dismissed. [Paras 15 to 31].
Result: Complaint dismissed.
ORDER
The complainant is in the business of trading in electronic items such as cell phones, electronic component accessories of mobile phones, I-pods, cameras, gaming devices, computers and other audio video consumer electronics. The complainant stored its stocks at a warehouse in Bhiwandi in Building No. I/12, Gala 8, 9 & 10, Shri Arihant Compound, Kalher, Bhiwandi, Thane. The stocks stored in the said premises were insured with the opposite party National Insurance Co. Ltd. under a Floater Policy for a period 18.04.2013 to 17.04.2014 for an insured sum of Rs.5,00,00,000/-.
2. It is alleged that at midnight around 12:30/12.45 a.m. in the early morning hours of 03/04.07.2014, after heavy rains and water-logging, the building collapsed. Several people were injured and some also lost their lives in the said collapse. According to the complainant, the insurance policy covered the entire risk of stocks and accordingly the intimation was given to all concerned, including the Insurance Company, about the said accident. One of the grounds taken in this complaint is that the Insurance Company kept the matter pending for no valid reason and that the surveyor report was submitted belatedly. Not only this, the claim was also repudiated after the filing of the present complaint and the repudiation letter was brought-forth through the written version of the opposite party. The contention is that the Insurance Company has violated its obligations and so has the surveyor which amounts to breach of the regulations of the Insurance Regulatory and Development Authority (Protection of Policyholders’ Interests) Regulations, 2002.
3. The information was also followed by a claim form that was tendered intimating the cause of incident and losses suffered. A request was made for appointment of a surveyor. The Insurance Company in turn on 05.07.2013 called upon Mr. Atul C. Shah to conduct a preliminary survey of the said loss and to submit his report with the photographs at the earliest. The request was to carry out the survey immediately and provide the feedback accordingly. Mr. Shah vide letter dated 08.07.2013 intimated the complainant that they visited the premises on 06.07.2013 and inspected the building, the stock available and discussed the matter with the insured. Through the said letter, the surveyor asked for 24 documents, including the documents relating to the building. The said letter records that the complainant had intimated the cause of collapse of the building due to subsidence. The said word in ordinary parlance means the sedimentation or precipitation and, more particularly in relation to solid or heavy things, the settling thereof to the bottom. It also connotes sinking to lower levels and in short a fall in the level of ground. It can be gradual or sudden due to dynamic and variety of causes.
4. In the instant case, the incident was reflected as the building having collapsed due to sinking of the soil/earth on which the building was standing.
5. Through the said letter dated 08.07.2013, the complainant was called upon to engage any specialized agency to carry out a test for confirming the cause of collapse of the building for which time was taken by the complainant to furnish the same.
6. Regarding the accident a preliminary report was submitted by Mr. Atul C. Shah on 08.07.2013 where again it was indicated that the surveyor was informed of subsidence being the cause of collapse. In order to appreciate the facts of this case, it would be appropriate to quote paragraphs 6, 7 and 8 of the said preliminary report that are extracted hereunder:
“6. Location & Construction & Occupation:—
The insured’s property is located at Building # I/12 in Gala # 8, 9 & 10 at first floor in the building, which is constructed as ground plus one upper floor. It is in the complex, which is well known as Shri Arihant Compound in the Village of Kalher, Tal. : Bhiwandi, of Thane District of Maharashtra State. The complex is having more then 100 buildi
Repudiation – complainant has not been able to dislodge the exclusion invoked by the Insurance Company, the repudiation cannot be faulted with.
Lightening Strike - The incident of lightening struck on the insured’s premises is borne out by the reports in the local newspapers and the visit of revenue and police officials to the premises. Ther....
The court affirmed that damages due to inundation are covered under the insurance policy, and failure to provide policy terms invalidated the insurance company's repudiation.
Findings of fact recorded by State Commission cannot be interfered with in exercise of revisional jurisdiction of this Commission.
1. Investigated and determined - Merely because recording of evidence is required, or some questions of fact and law arise which would need to be investigated and determined, cannot be a ground for s....
Insurance Policy – Repudiation of claim – Surveyor;s report cannot be lightly brushed set aside & once survey report is not based on adhocism or is vitiated by arbitrariness, then jurisdiction of con....
Insurance – Collapse of building – Where policy in question is for reinstatement, Complainant is entitled for Reinstatement Value of similar building.
Insurance companies cannot repudiate claims without substantial evidence proving defects in design or construction as supported by independent expert evaluations.
No material damage was proven as a result of flooding; hence repudiation of the insurance claim was valid.
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