Insurance companies cannot avoid liability by citing external compensations, and second surveyors must be appointed with regulatory oversight.

1. Present Appeal has been filed against the Order dated 7.5.2013 passed by the State Consumer Disputes Redressal Commission, Rajasthan at Jaipur (hereinafter to be referred to as “State Commission”), whereby the Complaint filed by the Complainant was partly allowed and the Respondent was directed to pay 16,40,262 to the Complainant, being the full and final settlement after loss assessed by M/s. Apex Assessors Pvt. Ltd / the Second Surveyor. The Respondent was also directed to pay interest @9% on the above amount from 01.06.2010 till date of realisation along with 1,00,000 payable towards mental agony and hardships.

2. Brief facts of the case as narrated in the Complaint are that the Complainant, a company incorporate under the Companies Act, 1956, is engaged in the business of manufacturing and selling of products made from plastic. Complainant had taken a “Standard Fire and Special Perils Policy” bearing Policy No. 140400/11/09/11/00000627 from the Respondent, United India Insurance Company Limited (hereinafter referred to as the Insurance Company) for a sum of 1,00,00,000 from 26.8.2009 to 25.8.2010 for covering risk of “storage of Non - hazardeous goods subject to warranty that goods of Category I, II, III, Coin waste, Coin fibre, Caddies are not stored therein.” Unfortunately, on 29.10.2009, fire broke in nearby Indian Oil Corporate Limited (IOCL) fuel Storage and Distribution terminal situated in the RICCO Industrial Area. The fire continued for two hours resulting in huge loss of property and life. The factory of the Complainant being closely situated (50 meters away) caught fire and caused severe damage to the building and the goods kept therein. The Complainant informed the Respondent Insurance Company about the fire incident on 9.12.2009 and submitted a claim of 85,00,000 along with statement of property destroyed and damaged. The Respondent appointed a surveyor being Mr. Shyam Lal Agarwal, who assessed the loss of 35,72,791 [in the Complaint it is mentioned as 37,26,103] vide Survey Report dated 24.12.2009.

3. Pertinently, IOCL, on the insistence of the Ministry of Petroleum, Government of India had released an amount of 50 crores to be distributed to the units affected by the fire incident through RICCO. The Surveyor report prepared by Mr. Shyam Lal Agarwal was submitted before RICCO. In compliance of directions of the Hon’ble Rajasthan High Court, RICCO made payment of 40% of the amount assessed by the Surveyor in his report dated 24.12.2009, i.e., 14,63,953 towards adhoc relief against damages caused due to IOC fire incident, was paid to the Complainant Company.

4. The Respondent - Insurance Company, appointed another Surveyor being M/s. Apex Assessors Pvt Ltd, who assessed the loss at 15,52,317 vide survey report dated 3.10.2011. Despite that, the Respondent - Insurance Company did not settle the Claim of the Complainant. Aggrieved by the actions of the Respondent - Insurance Company, the Complainant filed Complaint before the State Commission alleging deficiency in service on the part of the Respondent Insurance Company with the following reliefs:
“A. That the application of the Complainant Company should be accepted and the orders to be passed against the defendant company an amount of 37,26,103 along with interest payable at the rate of 12% per annum till the date of payment for not settling the claim of the Complainant Company for more than two years time without any reason.
B. That the Complainant Company had to suffer heavy losses due to the non - settlement of the claim by the defendant Insurance Company for more than two years and had to face mental harassment and problems and also bad impact has be