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2026 Supreme(Online)(SCDRC) 2865
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
A. C. Raval, Presiding Member, P. R. Shah, Member
Bajaj Alliance General Insurance Company Limited – Appellant
Versus
Mumtazben Mahamadyasin Memon – Respondent
Appeal No. 827/2018
For the Appellants/Petitioners: K. S. Pathak
For the Respondents: Ananad Parikh
An insurer cannot arbitrarily close an insurance claim through a surveyor for alleged non-submission of documents without proof of valid service, and in the absence of a reinstatement clause, actual prior repair is not a mandatory condition for indemnity.
Headnote:(A) Consumer Protection - Insurance - Deficiency in Service - Claim repudiation - Non-submission of documents - Surveyor closing claim without authority - Insurer failed to lead evidence of non-service of notices - Adverse inference drawn for non-production of surveyor’s report. (Paras 9.3, 9.7, 9.12)
(B) Indemnity Insurance - Reinstatement clause - Absence of such clause - Actual repair not a sine qua non for claim settlement - Insurer cannot insist on proof of actual repairs unless contractually mandated. (Paras 9.10, 9.11)
(C) Appellate Interference - Scope - Appellate authority should not interfere with lower commission's balanced award where occurrence of loss is undisputed but quantum is estimated - Principle of equity followed. (Para 10.4)
Facts of the case:
The respondent-complainant held home insurance policies covering building and household items. Heavy rains damaged the insured properties. The appellant-insurer, through a surveyor, sought documents. The complainant claimed to have submitted these to the insurer's agent, but the insurer closed the claim as 'no claim'. The District Commission awarded Rs. 3,50,000 as compensation, leading to this appeal.
Findings of Court:
The court held that the insurer failed to prove the complainant's non-cooperation and that the closure of the claim by a surveyor—who lacked authority to reject claims—was legally unsustainable. Adverse inferences were drawn against the insurer for failing to produce the survey report. The court affirmed the District Commission's award as a balanced approach to determine just compensation.
Issues: Whether the insurer's rejection of the claim due to allege non-submission of documents was justified; whether the surveyor had the authority to close the claim; and whether the awarded compensation was equitable.
Ratio Decidendi: An insurer cannot arbitrarily close claims based on alleged non-submission of documents without proving the service of notice; further, in the absence of a reinstatement clause, an insured is entitled to indemnity for loss determined by the court even without proof of actual repair.
Result: Appeal dismissed; District Commission’s order confirmed.
| Table of Content |
|---|
| 1. procedural history of the consumer complaint and appeal. (Para 1 , 2 , 3) |
| 2. summary of the impugned order regarding damages assessment. (Para 4) |
| 3. factual basis of the insurance claim and damage occurrence. (Para 5) |
| 4. summary of rival arguments concerning document submission and proof of loss. (Para 6) |
Order by Hon'ble Ms. P. R. Shah, Member
1. The present appeal is filed by the appellants being aggrieved and dissatisfied with the order dated 05.10.2017 passed by the Ld. District Consumer Dispute Redressal Commission, Banaskantha at Palanpur in Consumer Complaint No. 312 of 2016.
2. When the matter was called out Ld. Advocate Ms. K. S. Pathak for the Appellant and Mr. Ananad Parikh, Ld. Adv. for the Respondent remained present.
3. The appellant is the original opponent, respondent is the original complainant in the complaint before the Ld. District Commission and for the sake of convenience parties will be addressed with the same nomenclature.
Impugned Judgment
4.1 The Learned District Commission has held that the opponent appointed a surveyor to assess the damage yet did not bring the report on record. The complainant has submitted a Panchnama wherein the estimated total loss due to heavy rains to the building and household items is stated to be Rs. 7,00,000/-. However, the Panchnama is signed by two people and there is no signature of the Nagarpalika, Mamlatdar, Talati, or any other authority, and therefore the estimate cannot be taken to be the actual expenditure. The Learned District Commission held that in such circumstances, in the absence of strong evidence on the expenditure actually incurred, considering that due to rain there was damage to the house and household items, then an award of Rs. 3,50,000/- would meet the ends of justice. The Learned District Commission awarded this amount with 9% interest and Rs. 3,000 as cost.
Facts
5.1 The facts as narrated in the complaint, in brief, are that the complainant had availed "Home Insurance All Risk" policy of the opponent for his two houses for the period 27.11.2014 to 26.11.2015. The sum insured for one policy number XXX2024 was Rs. 8 lakhs for building and Rs. 2 lakhs for household items. The sum insured for policy number XXX2023 was Rs. 8 lakhs for building and Rs. 1 lakh for household items.
5.2 The complainant avers that from 27.07.2015 to 29.07.2015, there were heavy rains in Dhanara which caused huge damage to both his houses. It is stated that there was water logging in both the houses, cracks in the walls, the floor had sunk, toilets were broken and sunk, and household items, groceries, furniture, washing machine all got damaged, due to which the complainant suffered heavy losses.
5.3 The complainant gave intimation to the opponent of the loss, pursuant to which the opponent deputed a surveyor, Rajendra S. Joshi, for visit and assessment of the loss. The complainant avers that after the survey, all required documents like the estimation for renovation given by the engineer, Dhanara Nagar Palika certificate, electricity bill, house registration record, Nagar Palika tax receipt, house Panchnama, insurance policy, etc. of both the houses in original were given to the opponent's insurance agent, Raj Insurance Consultancy, Dhanera (through which the complainant had availed the opponent's policies), who in turn sent all the documents to the opponent.
5.4 Despite this, the surveyor of the opponent sent letters dated 12-2-2016 and 10-3-2016 to the complainant stating that if the documents are not provided, the claim will be closed. The complainant states that although documents were sent to the opponent, the surveyor sent such letters stating that the claim would be closed.
5.5 The complainant avers that under policy number XXX2024, there is loss of Rs. 4 lakhs to the building and Rs. 2 lakh loss for the household items, amounting to a total loss of Rs. 6 lakhs under the policy. It is averred that under the policy XXX2023, the loss to the building is Rs.
