The National Consumer Disputes Redressal Commission (NCDRC), chaired by Dr. Sadhna Shanker, ruled in favor of Ramdev Masala in an appeal against United India Insurance, holding the insurer responsible for service deficiency due to the wrongful repudiation of an insurance claim.
Case Summary
Ramdev Masala had an insurance policy worth Rs. 20,00,000 with United India Insurance through a bank. During the policy period, their stock was severely damaged by atmospheric lightning and flooding. Initially, the damage was reported as flood-related. However, after consulting the cold storage owner, it was determined that atmospheric lightning was the cause. The insurer denied the claim, arguing that flood damage was not covered under the policy. A surveyor appointed by the insurer assessed the loss at Rs. 17,57,930 but questioned the claim of lightning damage. Dissatisfied, Ramdev Masala filed a complaint with the State Commission of Gujarat, which was dismissed. They then appealed to the National Commission.
Insurer’s Arguments
The insurer contended that the policy’s exclusion clause h(ii) excluded coverage for losses due to atmospheric disturbances such as storms, floods, and inundations. They claimed the complainant’s damage was excluded from coverage. The insurer also argued that there was no evidence of lightning causing the damage, citing the complainant’s own admission of flood damage in their correspondence. Furthermore, they challenged the reliability of the surveyor’s report, noting that the surveyor had acknowledged flood risk coverage. They asserted that the flooding occurred before the reported lightning, which could not have caused the damage. The insurer maintained there was no deficiency in their service and defended the claim denial.
NCDRC’s Observations
The NCDRC noted that the surveyor had overlooked the complainant’s evidence regarding the damage. Despite significant damage to the cold storage building from lightning and rain, the surveyor’s dismissal of this evidence and assertion that morning rain, not lightning, caused the damage was unsubstantiated. Consequently, the National Commission overturned the State Commission’s decision and ruled in favor of the complainant. The insurer was ordered to pay Rs. 17,57,930 with 9% interest per annum.
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