On 8th May 2024, in the case of M/s Shah Vadilal Jethalal vs New India Assurance Co. Ltd. (First Appeal No. 681 of 2012), the National Consumer Disputes Redressal Commission in New Delhi, presided over by Mr. Subhash Chandra, ruled in favor of the insurance company, New India Assurance. The complaint was dismissed due to the complainant’s failure to adequately protect the insured property and provide necessary information to the insurer.
The complainant, M/s Shah Vadilal Jethalal, a distributor for TISCO, had purchased a ‘Burglary and House Breaking Policy’ from New India Assurance. The policy, active from 14th November 2000 to 13th November 2001, covered a range of goods including Agro buckets, tools, and other items, totaling Rs. 1,00,53,000. A premium of Rs. 12,535 was paid for the policy. The insured goods were stored in a warehouse at the steel yard complex assigned by Steel Chambers.
On 8th September 2001, a truck carrying stolen goods from the insured warehouse was caught, which led to the filing of a First Information Report (FIR). After assessing the loss, a claim was made for Rs. 89,29,703.65. However, New India Assurance rejected the claim.
The complainant lodged a complaint with the State Consumer Disputes Redressal Commission in Maharashtra, but it was dismissed due to non-disclosure of important facts and inadequate security measures. The complainant then appealed to the National Consumer Disputes Redressal Commission (NCDRC).
New India Assurance argued that the complainant had broken the terms of the insurance policy by not providing sufficient security for the warehouse. They also claimed that the complainant did not provide all necessary details to the surveyor, despite multiple notices.
The NCDRC noted that the terms and conditions of the policy required the complainant to take ‘reasonable steps’ to protect the insured property, and to provide all necessary information to the insurer. It was found that the complainant had not fulfilled these responsibilities.
While the NCDRC acknowledged the importance of a surveyor in settling a claim, it maintained that the insurance company has the right to accept or reject the surveyor’s report, provided they have a valid reason. They found that New India Assurance had justified reasons for rejecting the report and appointing a second surveyor.
The NCDRC, after examining the evidence, concluded that the complainant failed to prove that the surveyor’s report was unfair. The complainant also did not provide enough proof to challenge the insurer’s claims regarding the extent of the burglary and the value of the loss. The NCDRC agreed with the State Commission’s findings, which were based on the evidence presented.
Therefore, the NCDRC decided not to intervene in the State Commission’s order. The appeal was dismissed due to lack of merits, and each party was asked to bear its costs.
Takeaway: This judgment highlights the importance of adhering to the terms and conditions of an insurance policy, particularly taking adequate measures to protect the insured property and providing comprehensive information to the insurer.
