NCDRC directs insurance company to pay Rs 7 crore to Panipat firm damaged in 2013 fire

“…a fraudulent claim should have been corroborated by cogent evidence without which it is only speculative,” said Subhash Chandra, presiding member of the NCDRC, on November 9.

The Commission also flagged a two-year delay in the submission of the surveyor’s report.

The Commission also held that as per law, the insurer is bound to accept or reject the claim within 30 days from the surveyor’s report. In this case, however, there was an ‘unexplained’ eight-month delay after which the insurance company rejected the claim. This, according to the Commission, was not based on any cogent reasoning.

Along with the payment of Rs. 6.97 crore, the insurance company was also directed to pay an interest of 6 per cent and legal costs of Rs 50,000.

After the office-cum-warehouse of Swarna Motors caught fire, it lodged a claim of Rs 6.97 crore from Oriental Insurance Company.

Atul Kapur, the surveyor hired by the insurance company, submitted a report in 2015 which reported the net loss to Swarna Motors as Rs 48.8 lakh. The report stated documents, including stock registers, had not been maintained.

Swarna Motors stated it was unable to provide most documents pertaining to the stock as they were burnt in the fire. The surveyor concluded that the firm was unable to substantiate their claim amount.

Following the report of the surveyor, Oriental said the claimant had failed to establish and provide necessary proof to substantiate the claim of Rs. 6.97 crore.