The state consumer forum on Friday held the New India Assurance Company Ltd guilty of providing deficient services by arbitrarily rejecting the claim of an Andheri businessman and directed it to pay a compensation of US$55,973.93 as on October 30, 2006 along with nine per cent simple interest.
Complainant Anand Jaisingh had dragged the insurance firm to the court over a dispute in the claim amount, regarding his printing machine that had got damaged in the 2005 Mumbai deluge.
The principal amount, after interest calculations, translates into Rs41 lakh (considering the exchange rate of Rs45 a dollar at the time).
According to Jaisingh, the proprietor of M/s Channel Digital, he was into the business of jet printing. The printing machine required for his business was in sured under the ‘Standard Fire and Special Peril’s Policy’ by New India.
In his complaint, Jaisingh said the policy was subscribed jointly by him and the Union Bank of India for a sum of Rs 1,15,09,462 for the period from July 6, 2005 to July 5, 2006. The joint nature of the policy was because the bank had given a loan for the machine. Jaisingh said most part of the city was inundated on July 26, 2005 and the deluge damaged his machine beyond repair. He then made a claim on the policy.
“After the consumer lodged the claim, the insurance firm appointed a surveyor who could not carry out exhaustive technical survey about the damage to the machine. However, the surveyor had qualified the damage to the machinery due to inundation prima facie and arrived at two different figures of damage,” reads the consumer forum’s order.
While Jaisingh demanded the entire cost, New India denied the total-loss theory and advised him to restrict the claim to damaged parts.
New India alleged that Jaisingh did not allow dismantling of the machine to ascertain the actual damage, prompting it to reject the claim.
The forum, after going through the evidence brought on record, held, “The insurance firm had rejected the claim purely on grounds of technicalities of alleged non-cooperation of the complainant to dismantle the machine. The consumer, as seen from his complaint, is a young entrepreneur who had entered the business of jet printing by availing a big chunk of loan from a bank.
The consumer forum observed that New India could not justify its decision to not accept the estimate submitted by Jaisingh to replace the machine. The forum held that there was arbitrariness on the part of the surveyor dealing with the case. “Repudiation of the claim merely based on the letter of the surveyor is unsustainable in the eyes of law,” observed the consumer forum.
The forum also directed New India to pay Rs50,000 for mental agony and Rs25,000 towards litigation cost.
Co’s decision arbitrary: State consumer forum
The consumer forum observed that the insurance could not justify its decision to not accept the estimate submitted by Jaisingh to replace the printing machine. The forum opined that there was arbitrariness on the part of the surveyor dealing with the case. “Repudiation of the claim merely based on the letter of the surveyor is unsustainable in the eyes of law,” observed the consumer forum.
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