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2023 Supreme(Online)(MAD) 32226
MADRAS HIGH COURT
2014 IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated: 05.01.2023 CORAM THE HONOURABLE DR. JUSTICE ANITA SUMANTH WP.No.21116
21116
The appointment of a category B surveyor to assess a claim that is in the region of Rs.6 crores is contrary to the Insurance Regulatory and Development Authority (Protection of Policyholders Interest) Regulations, 2002.
Headnote:
INSURANCE - FIRE INSURANCE - SURVEYOR - [The appointment of a category B surveyor to assess a claim that is in the region of Rs.6 crores, is seen to be contrary to the Regulations.]
Fact of the Case:
The petitioner, a power generation company, had insured its coal stock with the respondent insurance company. A fire broke out in the coal stock, and the petitioner filed a claim with the respondent. The respondent appointed a category B surveyor to assess the claim, and the surveyor submitted a report repudiating the claim. The petitioner challenged the repudiation of the claim, arguing that the appointment of a category B surveyor was contrary to the Insurance Regulatory and Development Authority (Protection of Policyholders Interest) Regulations, 2002.
Finding of the Court:
The court held that the appointment of a category B surveyor to assess the claim was contrary to the Insurance Regulatory and Development Authority (Protection of Policyholders Interest) Regulations, 2002. The court also held that the respondent insurance company's own regulations required the appointment of a category A surveyor to assess the claim.
Issues: Whether the appointment of a category B surveyor to assess the claim was contrary to the Insurance Regulatory and Development Authority (Protection of Policyholders Interest) Regulations, 2002.
Ratio Decidendi: The court relied on the Insurance Regulatory and Development Authority (Protection of Policyholders Interest) Regulations, 2002, which require the appointment of a category A surveyor to assess claims that are in the region of Rs.6 crores.
Final Decision: The court allowed the petition and directed the respondent insurance company to appoint a category A surveyor to assess the claim.
WP.No.21116 of 2014
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated: 05.01.2023
CORAM
THE HONOURABLE DR. JUSTICE ANITA SUMANTH
WP.No.21116 of 2014
OPG Power Generation P. Ltd.,
Rep. by its Joint Managing Director,
Mr.T.Chandramoulee
No.6, Sardar Patel Road, Guindy,
Chennai 600 032.
... Petitioner
Vs
The Oriental Insurance Company Limited,
Rep. by the Chief Regional Manager,
Corporate Business Regional Office,
'Rosy Tower' 2nd Floor,
No.7, Nungambakkam High Road,
Chennai 600 034.
... Respondent
PRAYER: Writ Petition filed under Article 226 of the Constitution of India praying to
issue a Writ of Certiorarified Mandamus, to call for the records relating to the order
dated 30.04.2014 of the Respondent in respect of Insurance claim
No.520000/11/2014/000005/IAR under Policy No.520000/11/2013/101 for
Spontaneous Combustion to Coal Stocks in Unit II and quash the same and
consequently direct the Respondent to settle the insurance claim as estimated by the
petitioner.
For Petitioner
: Mr.S.S.Swaminathan
For Respondent
: Mr.N.Venkateswara
for M/s.Nageswaran & Narichania
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https://www.mhc.tn.gov.in/judis
WP.No.21116 of 2014
O R D E R
The petitioner is engaged in the business of power generation and manages three
Coal based Thermal Power Plants at Gummidipoondi. Unit-I and Unit-III of the
Thermal Plants are stated to be insured with M/s.United India Insurance Company
Limited and Unit-II with the respondent herein, being the Oriental Insurance Company
Limited. A Fire Industrial All Risks Policy had been taken bearing
No.520000/11/2013/101 dated 04.09.2012 for the period 04.09.2012 to 03.09.2013 for
a sum insured of Rs.2,74,05,00,000/-. The policy covered building, furniture, fittings,
plant and machinery and omission to insure.
2.Apart from loss of profit for Fire and Machinery breakdown, an endorsement
was made to the policy on 07.12.2012 to include the stock of Coal covering a value of
Rs.15 crores with spontaneous combustian risk/cover. The period of insurance was
amended to read 01.09.2012 to 31.08.2013 by way of an endorsement made on
07.09.2012. The lending bank interests were also suitably amended on 18.12. 2012.
3.The petitioner intimated the respondent that 'hotspot' had been observed on
31.05.2013 at 15.00 hours and the same commenced burning at 19.30 hours on
03.06.2013. One M/s.L.S.Surveyors had been appointed on 03.06.2013, who had
witnessed the fire and the loss of the coal in Unit-II. The fire was brought under control
following the standard operation procedure. The petitioner estimated the loss at a sum of
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https://www.mhc.tn.gov.in/judis
WP.No.21116 of 2014
Rs.6,37,72,508/- and made a claim before the respondent.
4.One Mr.Dakshinamoorthy was appointed as a Surveyor on 04.06.2013 and a
final survey report had been filed on 10.10.2013. The petitioner thereafter made
enquiries commencing from 2013 through subsequent letters and remainders, the last of
which was sent on 24.01.2014, seeking the status of its claim. By letter dated
13.03.2014, the respondent wrote to the petitioner indicating its inclination to repudiate
the claim and calling for an explanation. On 24.03.2014 and 29.04.2014, detailed letters
and explanations were putforth by the petitioner responding to the notice received. A
specific objection was raised pointing out that the survey or selected had not been of the
category required under the Insurance Regulatory Development Authority (IRDA
Regulations).
5.Despite the objection raised, the impugned order has come to be passed on
30.04.2013 pointing out various alleged defeciencies/lacuna in the protocols followed in
Unit-II and, in conclusion, repudiating the claim made.
6.Learned counsel for the respondent would straightaway raise a preliminary
objection on the maintainability of this writ petition pointing out that the proper course
of action would have been for the
