The National Commission held the insurer liable to settle the claim in accordance with the original computation of loss jointly signed by the surveyor and insured
Biswajit Guha, proprietor of Vida Engineering Company, was awarded a contract for constructing a road in South Tripura. To insure this work, he took a Contractor’s All Risk Insurance Policy from New India Assurance. He was charged Rs 3,48,316 as premium. He had to subsequently pay further amounts of Rs 1,03,987 and Rs 1,13,076 as additional premia.
In mid-July 2008, there was heavy rainfall at the construction site which led to flash floods, causing damage to the project work. Guha informed the insurer, which deputed S.R. Das as surveyor. Das visited the site and assessed the loss at Rs 60,15,232. The surveyor also obtained Guha’s signature to confirm the correctness of the loss assessment. Based on this computation, Guha lodged a claim quantifying the loss at Rs 60,15,232. Of this amount, the policy provided for deduction of 10 per cent contactor’s profit and 5 per cent policy excess, so the net amount payable would be Rs 50,17,669.
When the surveyor submitted the survey report, he fixed the insurer’s liability at Rs 27,63,787 by making further deductions for items termed as being outside the purview of the policy. The survey report did not give any explanation or reasoning for the reduction. New India settled the claim on the basis of the liability mentioned in the survey report.
Since there was a huge difference between the claim amount of Rs 50,17,669 and the settlement amount of Rs 27,63,787, Guha accepted the amount under protest and represented for payment of the remaining amount. When the insurer did not comply, Guha filed a consumer complaint before the West Bengal State Commission. After taking permission from the State Commission, Guha obtained expert opinion from an engineer who was on the panel of the State Commission. The expert’s report established that the computation of loss assessment in the survey report was incorrect, arbitrary and unfair.
The State Commission, without giving any reasoning, merely allowed Rs 8 lakh instead of the entire balance claim amount. Both Guha and New India challenged this order by filing a revision petition.
New India argued that the complaint ought to have been dismissed as the insured had accepted the claim settlement amount.
The National Commission pointed out that the Supreme Court had repeatedly held in a number of cases that if a consumer can prove that the discharge voucher was executed due to compelling circumstances, it would not act as an impediment to the maintainability of the complaint. In this case, Guha had accepted the claim amount under protest and had represented for payment of the balance amount. So, it held that the discharge voucher was not signed by Guha of his own free will. Hence, the Commission concluded that the execution of the settlement or discharge voucher would not affect the maintainability of the complaint.
The National Commission also
noted that the surveyor had assessed the loss, and computation had been approved by the insured. So, it held that the surveyor was not entitled to make deductions subsequently, and that too without any justification.
Accordingly, by its order of July 1, 2022, delivered by the bench of C. Viswanath and Ram Surat Ram Maurya, the National Commission held the insurer liable to settle the claim in accordance with the original computation of loss jointly signed by the surveyor and the insured. It held the insured to be entitled to recover the loss as originally assessed at Rs 50,17,669. It ordered New India Assurance to adjust the amount which had been sanctioned, and pay the balance along with 6 per cent interest.
The writer is a consumer activist