Chhattisgarh consumer court directs insurance company to pay Rs 85,71,271 with 6% interest to complainant | India News

The Chhattisgarh consumer disputes redressal commission orders an insurance company to pay Rs 85,71,271 with 6% interest to M/s. Shri Shyam Food Products. The company repudiated the claim for damaged stock, leading to a legal battle. The Consumer Court’s ruling emphasised adherence to regulations and timely claim settlement.
The Chhattisgarh consumer disputes redressal commission has ruled in favor of a complainant against an insurance company, directing them to pay an amount of Rs 85,71,271 within 45 days with a 6% per annum interest rate.The complainant, M/s. Shri Shyam Food Products, had filed a complaint alleging restrictive trade practices by the Oriental Insurance Company for repudiating an insurance claim. The insurance policy covered a sum assured of Rs 1,20,00,000 for the period between April 2016 to April 2017, insuring the stock maintained by the complainant during business operations.
The dispute arose when a fire incident damaged the stock in May 2016, leading to a preliminary survey by a surveyor appointed by the insurance company. The final survey assessed the loss at Rs 85,71,271, along with a compensation claim for mental agony and harassment. Despite the complainant’s efforts to settle the claim, the insurance company repudiated it in July 2019.
The complainant alleged that the insurance company unfairly repudiated the claim based on grounds not disclosed in the policy schedule or the insurance proposal. They further claimed that the company failed to adhere to the regulations set by the Insurance Regulatory and Development Authority of India for claim settlement.
The Consumer Court highlighted that the insurance company failed to act upon the final survey report and unnecessarily delayed the settlement by appointing multiple investigators. The court emphasized that the company’s actions constituted a deficiency in service and unfair trade practices.
Consumer Court President Justice Gautam Chourdiya stated, ‘Thus, with the foregoing discussion we are of the considered view that the insurance company ought to have acted upon the final survey and assessment report and to settle the claim accordingly and in not doing so they have committed deficiency in service and unfair trade practice in unnecessary delaying the settlement of claim in appointing different investigators and seeking investigation cum expert opinion which was uncalled for and against the provisions under the Regulation 2017 and the Section 64 of the Insurance Act.’
The insurance company has been directed to pay the complainant the awarded amount along with the cost of litigation.

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