Case Law Title
Jindal Sales vs United India Insurance Co. Ltd.
Summary
The Chandigarh District Consumer Disputes Redressal Commission accepted a complaint against United India Insurance Co. Ltd. for refusing to resolve a claim for a fire accident, despite the insurance company having a valid policy. The complainant, who paid the premium and obtained a stock insurance policy, claimed that their shop caught fire in September 2019. The fire was caused by a short circuit in a nearby shop, and the insurance company sent a surveyor to investigate. The surveyor found that the complainant’s claim was null and void due to the absence of any closing stock from the income tax return for the 2018–19 fiscal year. The Insurance Company was unable to produce any significant documentary evidence to refute the surveyor’s report, with the exception of IT reports showing Nil closing stock that were later updated. The Commission was forced to accept the surveyor’s assessment as accurate, as the surveyor had carefully reviewed all of the damage on-site.
About the case
Pawanjit Singh, the President of the Chandigarh District Consumer Disputes Redressal Commission I, Surjeet Kaur, a Member, and Suresh Kumar Sardana, a Member, accepted the complaint against United India Insurance Co. Ltd. (the Insurance Company) for its refusal to resolve a claim for a fire accident even though the Insurance Company had a valid fire insurance policy.
The Insurance Company is required by the Commission’s direction to reimburse the complainant for Rs. 8,79,855/-plus 9% annual interest. In addition, the Insurance Company must pay the claimant Rs. 30,000 as compensation for mental suffering and Rs. 15,000 towards legal expenses.
The complainant paid the appropriate money and obtained the stock insurance policy under the Standard Fire and Special Perils Policy for an insured amount of Rs 40 lakhs for a year. The complainant claims that one unfortunate night in September 2019, while they were getting ready for the approaching holiday season, their shop caught fire and was destroyed. After an investigation, it was determined that the cause of the fire was a short circuit in the nearby shop.
The fire department worked very hard to put out the fire, and major newspapers covered the incident as well as the complainant’s significant losses. When the incident was reported in a timely manner, the insurance company sent a surveyor, who visited the scene of the fire accident, took the complainant’s version of events, recorded a statement, and requested the necessary documentation from the complainant. The fire destroyed the bills for a number of things.
According to the invoices, the amount purchased between 1.4.2019 and 9.9.2019 was Rs. 21,37,199.34, while the amount sold was Rs. 26,90,911.20. Additionally, it is claimed that the complaint acted honestly and provided all relevant information on the accident and losses, as well as the prompt provision of any documents requested by the aforementioned surveyor. After that, the surveyor filed his report and determined that the complainant’s claim was null and void due to the absence of any closing stock from the income tax return for the 2018–19 fiscal year.
The Standard Fire and Special Perils Policy was purchased by the complainant, who paid the premium and obtained a stock insurance policy worth Rs. 40 lakhs for a year. Only a wooden barrier separated the complainant’s shop from the neighboring shop’s short circuit, which resulted in a terrible fire catastrophe in September 2019. The fire caused the Complainant to sustain substantial losses.
Soon after the incident, the Complainant brought the situation to the attention of the Insurance Company, who assigned a surveyor to look into it. The surveyor went to the fire accident scene, took the complainant’s statement, and asked to see any pertinent documentation. Many bills for items were destroyed in the fire. From April 1, 2019, to September 9, 2019, purchases totaling Rs. 21,37,199.34 and sales totaling Rs. 26,90,911.20 were recorded on the bills that were available.
The Insurance Company was unable to produce any significant documentary evidence to refute the surveyor’s report, with the exception of IT reports that showed Nil closing stock that were later updated. Accordingly, the Commission found itself forced to accept the surveyor’s assessment as accurate because the surveyor had carefully reviewed all of the damage on-site.
