Insurance companies must ensure policy terms are clear regarding coverage during negative balance periods; acceptance of premium after loss can imply continued coverage.

ORDER

DR. INDER JIT SINGH, MEMBER

1. The present First Appeal (FA) has been filed by the Appellant against Respondents as detailed above, under section 21(a)(ii) of Consumer Protection Act 1986 , against the order dated 23.05.2012 of the State Consumer Disputes Redressal Commission, Rajasthan (hereinafter referred to as the ‘State Commission’), in Consumer Complaint (CC) 13/2010 inter alia praying for setting aside the order dated 23.05.2012 passed by the State Commission.

2. The Appellant was Complainant and the Respondents were OPs in the said CC/13/2010 before the State Commission. Notice was issued to the Respondents on 27.08.2012. The parties filed their Written Arguments/Synopsis on 14.05.2019 (Appellant) and on 22.12.2023 (Respondents) respectively.

3. Brief facts of the case, as emerged from the FA, order of the State Commission and other case records are that: -

The Appellant/complainant, who is a manufacturer of coated textiles and is engaged in the transit of coated textile, has taken a Marine Cargo Open Policy No. 33102/21/08/02/00000001 on 31.03.2008 from the Respondents/Opposite Party to cover their goods for Rs.40 crore for the indemnified transit as well as for securing transaction of their goods. The term of the policy was from 01.04.2008 to 31.03.2009. The sum insured of Rs.40 Crores in the policy has been regularly enhanced from time to time starting from starting from 01.04.2008 till 31.03.2009 as per the need of their business and of the Financial Year 2008 – 2009 the insurance cover was raised upto the tune of Rs. 162 Crores. On 26.09.2008, a consignment of 16,000 kg of Pathalate Plasticizers worth Rs.15,92,727/- from M/s KLJ Plasticizers Ltd. located at Sili Silvasa, which was to be transported to the complainant company located at Village Jaitpura, Jaipur. During transit from Sili Silvassa to Jaipur, an accident took place where the lorry tanker fell into Canal causing damage to the Lorry Tanker, injuries to the driver and the cargo loaded in the lorry tanker was totally destroyed causing huge losses to the complainant. It came to the knowledge of the complainant company on 27.09.2008 that accident has taken place. The Respondent/Insurance Company was intimated on the same day. On 27.09.2008, preliminary survey was conducted by one Shri Gautam Desai, appointed by the Insurance Company. Thereafter, another Surveyor C.L. Dhamija & Company was appointed on same date by the Respondents to whom the report was submitted by the earlier Surveyor. On 29.09.2008 the sum insured was further enhanced by Rs.40 Crores in addition to previous sum insured of Rs.80 Crores. On 19.11.2008, the sum insured was further enhanced by Rs.40 Crores in addition to previous sum insured of Rs. 120 Crores. The complainant suffered the loss of Rs.15,92,727/- in the said accident. The said raw material was duly purchased and subsequently owned by the complainant company was totally destroyed. The complainant gave various representations to get the claim of the complainant company. The said claim was the only claim raised by the company in 14 years of their relationship. On 22.12.2008, the Complainant submitted the complete details of their declaration and explained the entire facts for the exclusion of the invoices which were included by the complainant company in its statement due the inadvertence. On 25.03.2009, sum insured was enhanced to Rs. 2 crores in addition to previous sum insured of Rs.160 Crores. The Insurance Company repudiated the claim by letter dated 30.03.2009 stating in the said letter that on 25.09.2008 the branch office of the Respondent has recorded the negative balan