Insurance companies are required to provide fair compensation based on substantiated claims of personal injury, and arbitrary assessments are deemed unjust.

JUDGMENT :

S.K. PANIGRAHI, J.

1. In this writ petition, the petitioner seeks a directive from this Court to compel the National Insurance Company (NIC) to disburse Rs.10,00,000/- as compensation for a personal accident, along with an additional Rs.1,00,000/- to cover medical expenses.

I. FACTUAL MATRIX OF THE CASE

2. The brief facts of the case are as follows:

(i) On 02.10.2012, the petitioner was involved in an accident caused by the explosion of an LPG gas cylinder at the premises of a registered customer. Opposite Party No. 1, along with two other companies dealing in gas cylinders, had contracted with Opposite Party No. 2, National Insurance Company (NIC), under an insurance policy that covered liabilities arising from death, bodily injury, or property damage occurring at the premises of registered customers.

(ii) The insurance policy was effective from 02.05.2012 to 01.05.2013, with coverage limits of Rs.5,00,000/- per person for death and Rs.1,00,000/- for medical expenses.

(iii) Following the accident, NIC appointed a surveyor to assess the damage and determine liability under the policy. However, Opposite Party No. 3 (the registered customer) failed to submit the necessary documents, leading to the closure of the claim in 2015 due to insufficient documentation.

(iv) In 2019, the petitioner filed W.P.(C) No.5723/2019, seeking compensation based on a Disability Certificate issued seven years after the incident. This Court directed NIC to consider the petitioner’s personal accident compensation claim in light of the Disability Certificate.

(v) NIC failed to comply with the Court’s order within the stipulated time/prompting the petitioner to file a contempt petition (CONTC No. 3639/2022). Eventually, NIC deposited Rs.2,50,000/- for 50% disability and an additional Rs.97,500/- towards the petitioner’s medical expenses.

(vi) Dissatisfied with the compensation provided, the petitioner has filed the present writ petition, seeking a directive from this Court to compel NIC to pay Rs.10,00,000/- in personal accident compensation along with Rs.1,00,000/- for medical expenses.

II. SUBMISSIONS ON BEHALF OF THE PETITIONER

3. Learned counsel for the Petitioner earnestly made the following submissions in support of his contentions:

(i) The petitioner submits that the insurance company arbitrarily sanctioned only Rs.2,50,000/- without considering the full scope of insurance policy, which should entitle him to Rs.10,00,000/- for personal accident compensation and Rs. 1,00,000/- for medical expenses.

(ii) He further submits that despite multiple court orders, the insurance company has deliberately delayed and avoided paying the full compensation required under the policy. He claims that insurance company’s actions have caused him financial distress over a period of10 years.

(iii) The petitioner further contends that the insurance company is liable to pay the full amount stipulated under the policy for third-party claims, minus the amount already paid, with interest for the delayed payment.

(iv) He further contended that he has incurred additional litigation expenses of Rs.40,000/- each of three writ petitions and one contempt proceeding. He seeks interest on the claim amount from the date of the accident until realization of the final amount.

III. SUBMISSIONS ON BEHALF OF THE OPPOSITE PARTIES

4. The Learned Counsel for the Opposite Parties earnestly made the following submissions in support of his contentions:

(i) It is submitted that the fire was caused by the negligent handling of the LPG cylinder by the consumer and not by any defect in the cylinder or