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Insurance Claim Repudiated Solely on ? Kupwara Consumer Commission Holds Bajaj Allianz Liable
In a significant ruling reinforcing consumer rights in insurance disputes, the , has held that an insurer cannot repudiate a claim solely on the basis of a surveyor’s report. The Commission, presided over by President Peerzada Qousar Hussain and Member Ms. Nyla Yaseen, partly allowed a complaint against , directing it to pay ₹5 lakh for fire damage to a residential property along with compensation for harassment.
The Case in Brief
The complainants, Abdul Gani Pir and Rukhsana Begum, residents of Tarathpora, Handwara, ran a Hollow Bricks and tiles manufacturing unit financed by a loan from . They had obtained two insurance policies from Bajaj Allianz — one covering the residential building for ₹7 lakh and another covering the Hollow Bricks unit for ₹12 lakh. On , a fire broke out at the premises, severely damaging the residential house, machinery, and stock. An FIR was lodged, and both the and the Tehsildar confirmed the damage.
Despite multiple approaches, Bajaj Allianz repudiated the claim, citing the report of an -licensed surveyor who found no stock at the site during his inspection on .
The Insurer's Defence
Bajaj Allianz argued that the surveyor’s report was conclusive and that the absence of stock meant no loss was suffered. It also raised technical objections about the of complainant No. 2, Rukhsana Begum, in the unit. The bank, made a party as OP2, denied any , stating its role was limited to disbursing the loan.
Commission's Legal Analysis: Not the
The Commission firmly rejected the insurer’s reliance on the surveyor’s report as the sole basis for . It observed that the surveyor himself had acknowledged the damage to the building, including doors, windows, and roofing. The Report further corroborated the destruction of machinery, a generator, and household goods.
“A undoubtedly carries considerable value. However, the cannot be treated as particularly when the same is not supported by any evidence,” the Commission noted, citing the consistent position of the that a surveyor’s report is “an important piece of evidence but it is not the .”
The Commission emphasised that the the grounds of lies on the insurer. Since Bajaj Allianz produced no independent evidence to justify its decision, the was held to be unjustified.
Key Observations from the Judgment
- “The entire defence revolves around the alleged absence of the stock at site. The the grounds of lies upon the insurer. There is no plausible evidence on record to justify the .”
- “The insurer was duly bound to undertake a of the loss suffered by the complainants in respect of the insured property rather than repudiating the claim on mere assumptions.”
Final Directions and Impact
The Commission partly allowed the complaint with the following directions:
- Bajaj Allianz must pay ₹4,00,000 for the loss caused to the residential house, with interest at 6% per annum from the date of institution of the complaint until realisation.
- An additional ₹1,00,000 is awarded as compensation for repudiating the claim and causing harassment and inconvenience.
The insurer has been given four weeks to comply, failing which the entire awarded amount will carry interest at 10% per annum from the date of the order.
This ruling serves as a reminder to insurance companies that surveyor reports, while important, cannot substitute for a thorough and independent assessment of claims. Consumers whose claims are rejected on flimsy grounds now have a clear precedent to challenge such .
