IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, ALAPPUZHA.
Saturday the 26th March, 2022
Filed on 16.01.2021
Present
1. Sri.S.Santhosh Kumar (President).
2. Smt.Sholy P.R.(Member)
In
CC/No.16/2021
Between
Complainant:- Opposite Parties:-
Sri.Anil Kumar.A., 1. The Managing Director & CEO,
Kallikattaaiyathu, HDFC ERGO General Insurance Co.Ltd.,
Thamarakulam PO., Registered and Corporate Office,
Alappuzha -690 530. 1st floor, HDFC House,
Ph:9400298163 165-166 Backbay Reclamation.
(By Adv. H.T.Parekh Marg, Churchgate,
Mumbai – 400 020.
2. The Manager in Charge,
Customer Service Division,
HDFC ERGO General Insurance Co.Ltd.,
D 301, 3rd floor, Eastern Business
District (Magnet Hall), LBS Marg,
Bhandup West, Mumbai – 400 078.
3. The General Manager,
HDFC ERGO General Insurance Co.Ltd.,
Registered and Corporate Office,
1st floor, HDFC House,
165-166 Backbay Reclamation.
H.T.Parekh Marg, Churchgate,
Mumbai – 400 020.
4. The Manager in Charge,
HDFC ERGO General Insurance Co.Ltd.,
2nd floor, Chicago Plaza, Rajaji Road,
Near KSRTC Bus stand
Ernakulam – 682 035.
5. Sri.Jayaprakash J., Insurance Agent Irda
No.IRDA/RAP/KL/2015/2150,
Common Service Centre,
E Governance Services India Ltd.,
Digital Seva Kendra,
Kudassanad – 689 512.
6. The District Collector,
Collectorate, Alappuzha.
(Ops.1 to 4 rep. by Adv.Sri.C.Muraleedharan)
O R D E R
SRI. S.SANTHOSH KUMAR (PRESIDENT)
Complaint filed u/s 35 of the Consumer Protection Act, 2019
1. Material averments briefly discussed are as follows:-
Complainant is running a welding work shop named System and control at Thamarakulam Panchayath. Opposite parties 1to 4 are the officials of the insurance company and the 5th opposite party is an insurance agent. The work shop of the complainant is located in building no.8/53 of Thamarkulam Panchayath. The work shop is functioning for the last 21 years and it is the only means of lively- hood of the complainant. There are so many inmates in the small house of complainant and so he is residing in a room of the work shop.
2. 5th opposite party Sri. Jayaprakash an insurance agent of opposite parties 1 to 4 introduced the complainant in to the insurance scheme and accordingly he took a standard fire and special perils insurance material damage policy (Master Policy) of M/s HDFC Ergo Company and the sum assured was Rs. 4 lakhs. The risk location was 8/53 system and control Thamarakulam and the property insured was building including contents for a sum assured of Rs.2 lakhs and the building was insured for Rs. 2 lakhs. The total sum assured was Rs. 4 lakhs and the period of insurance was from 16/6/2019 to 15/6/2020.
3. On 23/7/2019 from 9.AM onwards there was a cyclone and heavy rain and an Acacia tree near the work shop fell on the workshop causing heavy damage, destruction to the shed, building and machineries. Almost all items including the electric panel board and other welding machineries had been destroyed. Machineries worth Rs.2 lakhs were damaged. Complainant immediately informed the matter to the Revenue and Panchayath authorities and also the insurance company. Complainant made a claim online as advised by the 5th opposite party for Rs.2,53,000/-. Insurance company appointed surveyor Sri. Subhash Chandra Bose for assessing the loss and damage and accordingly he assessed the damage.
4. Complainant received a letter dtd. 31/12/2019 stating that the claim was rejected observing that the policy covers loss or damages to dwelling due to insured perils, workshop shed is located at a distance of 50 meters away from the insured property and the workshop shed is not a covered occupancy under the policy. The rejection of the claim shocked the complainant and he was put in deep mental agony. The rejection of the claim was not proper and it amounts to unfair trade practice and deficiency of service. Hence the complaint is filed to direct the insurance company to pay an amount of Rs. 5 lakhs for reconstructing building and purchase of damaged machineries and Rs.20 lakhs as compensation on various heads. He is also claiming an amount of Rs.5 lakhs as cost.
5. 5th and 6th opposite parties remained exparte. Opposite parties 1 to 4 filed a joint version mainly contenting as follows:-
There is absolutely no deficiency in service on the part of these opposite parties. The claim of the complainant was duly entertained and repudiated the same on the basis of policy conditions.
6. Complainant availed a standard fire and special perils insurance policy for the period from 16/6/2019 to 15/6/2020 for the dwelling house of the complainant covering the building and the house hold articles excluding valuables and jewellery for the period from 16/6/2019 to 15/6/020 and the sum assured is Rs. 2 lakhs each. On getting intimation opposite party appointed a IRDI licenced surveyor for the inspection and assessment of the alleged damage. Surveyor submitted report assessing the net loss as Rs. 8254/-. He has considered depreciation at 20% and salvage Rs.2000/-. The property is 78.28 % under insured. The surveyor observed that the GI sheet shed is the present separately away around 50 mtr from the insured house in the same premises. The shed is used as workshop and it is not insured as per occupancy description(dwelling).
7. The workshop is not covered under the subject policy and there is no evidence that the property sustained damage due to fall of the tree. Immediately opposite parties issued a repudiation letter to the complainant on 31/12/2021 stating their inability to pay the claim. The company acted fairly, reasonably, justifiably repudiated the claim based on policy condition and hence there is absolutely no deficiency in service on the part of these opposite parties and they are not liable to pay any amount to the complainant. Policy of the insurance is a contract between the insured and the insurer and neither parties can traverse beyond its scope and ambit of the policy terms. Both the parties to the insurance are bound by terms and conditions. There is no merit and bonafides in the complaint and hence the complaint may be dismissed with compensatory cost.
8. On the above pleadings, following points were raised for consideration:-
1. Whether there is any deficiency of service from the part of insurance company as alleged?
2. Whether the details of the property insured shown in Ext.A2(b) can be accepted?
3. Whether the details of property insured shown in Ext.B1 can be accepted?
4. Whether the complainant is entitled to realize an amount of Rs. 5lakhs from the opposite parties for reconstruction of building and purchase of damaged machineries as prayed for?
4. Whether the complainant is entitled to realize an amount of Rs. 10 lakhs as compensation on account of the wrong decision taken by the opposite parties 1 to 4?
5. Whether the complainant is entitled to realize an amount of Rs. 10Lakhs as compensation for mental agony, shock, untold miseries and difficulties?
6. Reliefs and cost?
9. Evidence in this case consists of the oral evidence of PW1 and Ext.A1 to A22 from the side of the complainant and the oral evidence of RW1 and 2 and Ext.B1 to B3 from the side of opposite parties.
10. Points No. 1 to 5:-
PW1 is the complainant in this case. He filed an affidavit in tune with the complaint and marked Ext.A1 to A22.
11. RW1 is the Senior Manager of the HDFC Ergo General Insurance Co. Ltd.. He filed an affidavit in tune with the version and marked Ext.B1 to B3.
12. RW2 filed an affidavit stating that he is a surveyor and loss assessor. As per the instruction of the HDFC Ergo General Insurance company Ltd., he visited the house of the complainant at Mavelikara on 1/8/2019 for assessing the damage if any of the dwelling house and house hold articles. As per the inspection in the presence of the complainant the insured dwelling house and house hold articles were not sustained any damage. There was a GI sheet shed situated at 50meter away from the dwelling house and insured is conducting a workshop in that shed. As per the policy the dwelling house building and house hold articles excluding valuables and jewellery alone are insured by the policy. The shed and the materials there in were not insured and hence a report was prepared and he identified Ext.B3.
13. PW1, the complainant availed Ext.A2 insurance policy on 15/6/2019 from the opposite parties 1 to 4 M/s HDFC Ergo General Insurance Company Ltd through 5th opposite party who was their agent. The policy was valid for a period of one year from 16/6/2019 to 15/6/2020. The sum assured was Rs.2 lakhs for the building including contents and Rs. 2 lakhs for the building ( total sum insured Rs. 4 lakhs). On 23/7/2019 one Acacia tree fell on the workshop causing heavy damage to the building and the machineries there in. Complainant filed a claim form for an amount of Rs.2,53,000/-. However as per Ext.A1 letter dtd. 31/12/2019 the claim was closed on a contention that the location and occupancy is not covered under the policy. Though complainant filed several complaints opposite parties 1 to 5 did not redress his grievance and finally he had filed this complaint claiming an amount of Rs. 5 lakhs for reconstruction of building and purchase of damaged machineries, Rs. 10lakhs as compensation for the wrong decision by which the claim was denied and Rs. 10 lakhs as compensation and Rs.5 lakhs as cost. Opposite parties 5 and 6 remained exparte. It is not known why the District Collector, Alappuzha was made as 6th opposite party. Opposite parties 1 to 4 filed a joint version admitting that they had issued a policy for a period of one year from 16/6/2019 to 15/6/2020. However according to them the policy was issued to the dwelling house of the complainant covering the building and house hold articles excluding valuables and jewellery. On getting claim form they appointed a surveyor and the surveyor filed a report assessing the net loss as Rs.8254/-, after considering the depreciation of 20%, salvage of Rs.2000/- and under insurance. In the report it was stated that the workshop is situated in a shed which is away around 50 meters from the dwelling house which was insured. Hence according to them since the workshop was not insured they are not liable to pay and letter was issued on 31/12/2019 repudiating the claim. Complainant got examined as PW1 and marked Exts.A1,A2 and A3 to A17 series, A18series, A19series, A20, A21series and A22. The Senior manager of HDFC Ergo General Insurance Co. ltd was examined as RW1 and Ext.B1 to B3 were marked. The surveyor who prepared Ext.B3 report was examined as RW2. The complainant who was conducting the case in person filed a detailed argument note. The case advanced by complainant is that he had availed Ext.A2 insurance policy from opposite parties 1 to 4 M/s. HDFC Ergo Insurance Co. ltd. The sum insured was Rs. 2 lakh of the building including contents and Rs. 2 lakhs for the building. The policy was taken through 5th opposite party who was the agent of opposite parties 1 to 4. According to him he was conducting a workshop in the building known as Systems and Controls. While so on 23/7/2019 there was heavy rain in that area and an Acacia tree fell on the workshop causing damage to the building and the machineries. According to him the machineries worth Rs.2 lakhs were damaged and large scale damage was also caused to the shed where the workshop was functioning. Hence he filed a claim form before the insurance company claiming an amount of Rs. 1,35,000/- for structural and roofing , Rs.48,000/- for Civil work and Rs. 70,000/- for various machineries. Total Rs. 2,53,000/- (Ext.A11). However as per Ext.A1 dtd. 31/12/2019 the insurance company rejected his claim on a contention that the policy covers damage to dwelling place and the workshop is situated at a distance of 50 meters away from the insured property. The workshop shed is not a covered occupancy under the policy. Aggrieved by the same the complaint was filed. In the version as well as in the evidence tendered by RW1 the policy is admitted and it is valid from 16/6/2019 to 15/6/2020. Admittedly the tree fell on 23/7/2019 ie, during the period when the insurance policy was in force. The question to be looked into is whether the workshop is covered under the policy as contented by the complainant or it is not covered as contented by the opposite party. Ext.A2 (b) is the policy schedule which shows that it is a standard fire and special perils insurance and Rs.184/- was collected as premium and the sum assured is Rs. 4 lakhs. In Ext.A2 (b) the risk location is shown as 8/53, SYSTEM AND CONTROL, THAMARAKULAM, ALAPPUZHA DISTRICT. The occupancy is shown as dwellings. Details of the property insured is shown as building including contents sum insured Rs.2 lakhs and building Rs.2 lakhs. So according to PW1 though dwelling is shown as occupancy the number of building shown as 8/53 and name shown as System and Controls is his workshop. Further the detail of the property is building including contents. Hence according to him opposite party was not justified in rejecting his claim on a contention that the occupancy is shown as dwelling. PW1 has taken a contention in the complaint that there are so many inmates in his house and so he is residing in the workshop and it may be considered as his dwelling place. However except such a contention taken in the complaint there is no acceptable evidence for the same except his interested testimony. Per contra relying upon Ext.B1 which appears to be a copy of Ext.A2 (b) the learned counsel appearing for the opposite parties pointed out that though the risk location is shown as 8/53 Systems Control the occupancy shown as dwellings and so the workshop is not covered. It was also contended that the details of the property insured as per Ext.B1 is others excluding valuables and jewellery and the sum insured is Rs. 2 lakhs and for the building the sum insured is Rs.2 lakhs. Hence according to the learned counsel appearing for the opposite parties since valuables and jewellery are excluded beyond policy it can be only his house. But on a comparison of Ext.A2(b) and Ext.B1 which is supposed to the one and the same, it is seen that there are difference in details of the policy insured. In Ext.A2 (b) details of the property insured is shown as building including contents for Rs. 2 lakhs and building for Rs. 2lakhs. Whereas in Ext.B1 details of property insured is shown as others excluding valuables and jewellery for 2 lakhs and for building Rs. 2 lakhs. Ext.A2 (b) contains the seal and signature of 5th opposite party who is the agent of insurance company through whom PW1 availed the policy. Further opposite party has no case that Ext.A2 (b) is a forged document and that the contents shown in Ext.A2(b) are not true. On the other hand it appears that Ext.B1 was produced by the opposite parties by changing the details of the property insured purposefully to deny the valid claim of complainant. Ext.A4 is a certificate issued by the Village Officer on 16/1/2020 from which it is revealed that building no.53 in the 8th ward is the workshop building of PW1 and it got damaged in the rain. Opposite party has no case that Systems and Control is not the name of the workshop of PW1. Further in the risk location in Ext.A2(b) and Ext.B1 the number of building is shown as 8/53 ie, building no.53 in the 8th ward of Thamakulam Panchayath. As a matter of fact for each building even if it is a shed a number will be allotted by Panchayath. If the house was issued a separate number will be shown in the schedule. So it is pellucid that building No. 8/53 belongs to the workshop of the complainant and it got damaged during the rain. Ext.A5 is a certificate issued by the member of ward No. 8 of Thamarakulam Grama Panchayath certifying that PW1 is conducting a workshop by name System and Control in a shed adjacent to his house and damage was caused to the building and machinery during the rain. Ext.A6 is an affidavit filed by the vice president of Thamarakulam Grama Panchayath dtd. 24/1/2020 stating that Pw1 is conducting an engineering workshop by name System and Control in building No. 8/53 and on 23/7/2019 an Acacia tree fell on the workshop causing damage of about 5 lakhs. So from the evidence on record and from Ext.A2(b) and Ext.B1 it can be seen that the risk location is 8/53 Systems and Control which is the workshop belonging to PW1. Ofcourse it is noticed that in both Ext.A2(b) and Ext.B1 occupancy is shown as dwellings whereas PW1 is conducting a workshop in the building. As discussed earlier in Ext.A2 (b) policy schedule which was issued to PW1 the details of property insured is building including contents and building whereas in Ext.B1 the details of the policy insured is shown as other excluding valuables and jewellery and the building. On a comparison of Ext.A2(b) and Ext.B1 we have no hesitation to hold that Ext.B1 was prepared only with the intention to repudiate the claim. It is true that dwellings means house. However other descriptions in Ext.A2(b) without any ambiguity proves that the insured premises and the risk location was workshop known as System and Control and the contents along with building was insured. So we reject Ext.B1 policy schedule produced by the opposite parties and accept that Ext.A2(b) is the actual policy schedule and so PW1 is entitled for damage. In this context we are also enlightened by the decision of Hon’ble Supreme Court in Sangrur Sales Corporation Vs. United India Insurance Co Ltd and Anr. ( 2020 (2) KHC 244 SC)
“It is well-settled that in the event that the two constructions are possible or in the event of an ambiguity, that construction which is beneficial to the insured should be accepted consistent with the purpose for which the policy was taken namely to cover the risk on the happening of a certain event.”
It was held by the Hon’ble Supreme Court in Sushilaben Indravadan Gandhi Vs. New India Assurance Co. Ltd. (2021 (7) SCC 151)
“The exemption of liability clauses in insurance contracts are to be construed contra proferentem, in favour of the insured in case of ambiguity”
It was held by the Hon’ble Supreme Court in General Assurance Society Ltd. Vs. Chandmull Jain – (AIR 1966 SC 1644).
“ Where there is an ambiguity in the contract of insurance or doubt, it has be construed contra proferentem against the Insurance Company”
14. As held by the Hon’ble Supreme Court in OM Parakash Vs. Reliance General Insurance and Anr. on 4/10/2017 in Civil Appeal No. 15611 of 2017.
“Rejection of the claims on purely technical grounds in a mechanical manner will result in loss of confidence of policy –holders in the insurance industry. It needs no emphasis that the Consumer Protection Act aims at providing better protection of the interest of consumers. It is a beneficial legislation that deserves liberal construction. This laudable object should not be forgotten while considering the claims made under the Act.”
15. In said circumstances applying the principles laid down by the Hon’ble Supreme Court it can be safely concluded that the policy schedule issued to PW1 as Ext.A2(b) is to be accepted.
16. According to PW1 he sustained damage to the tune of Rs.2,53,000/- which is revealed from Ext.A11. On getting the claim application opposite party deputed RW2 and he visited the spot and prepared Ext.B3 survey report. During cross examination RW2 admitted that in Ext.A2(b) the risk location is shown as Systems and Control. He prepared Ext.B3 survey report in which the gross assessed loss is Rs. 50,000/- and after deducting depreciation, salvage under insurance etc. the amount payable is shown as Rs.8254/-. However he has only assessed the damage caused to the building on a contention that the contents was not issued. He was relying upon Ext.B1 policy schedule. However after evaluating the evidence on record we have already found that Ext.B1 is not a reliable document and Ext.A2(b) is the policy schedule issued to complainant and the insurance company is liable to pay damage to the building which is the risk location and contents there in. The building was insured for Rs. 2 lakhs and the contents were issued for another Rs. 2 lakhs (Total for Rs.4 lakhs). Ext.A21 series photographs shows that extensive damage was caused to the workshop. The certificates issued by the Village Officer (Ext.A4), Ward member (Ext.A5) and affidavit of Vice President of Thamarakulam Panchayath (Ext.A6) shows that extensive damage was caused to the building and the machinery therein. As per Ext.B3 report the surveyor had assessed only Rs. 8254/- as net loss. Though he had shown that there was under insurance @ of 78.28% and deducted an amount of Rs.29,746/- there is no reliable evidence on record to show the under insurance. As per Ext.B3 the gross assessed loss of building is Rs.50,000/-. Since no other material is available regarding the loss, we are relying upon Ext.B3 only to consider the assessed loss which is Rs. 50,000/-. According to PW1 he sustained a loss of Rs. 70,000/-(Ext.A11) due to damage sustained to the machinery. The surveyor has not assessed the value of machinery since according to him as per Ext.B1 policy the machineries were not insured. Since no other materials is available to consider the value, we are accepting Ext.A11 and find that Rs. 70,000/- can be considered as a loss sustained to PW1 due to damage to the machineries.
17. In the complaint complainant is claiming an amount of Rs. 5 lakhs on a contention that only if that amount is sanctioned by the insurance company he can reconstruct the building and purchase the damaged machineries. Again he is claiming an amount of Rs. 10 lakhs on account of damages due to the illegal act and wrong decision in deny the insurance claim. Further he is claiming an amount of Rs. 10 Lakhs on account of compensation for the shock experienced by him, his pathetic situation, his difficult financial situation, his deep mental agony unhappiness and shock and due to un told miseries and difficulties. Further he is also claiming an amount of Rs. 5 Lakhs towards cost, since he had spend several valid hours and met with expenses for the visit of the insurance company and expenses incurred as taxi fares to attend this Commission. In the light of the discussions made above we have already found that there was deficiency of service from the part of opposite parties 1 to 4 by repudiating a genuine claim of the complainant on a contention that the insured building is dwelling house. We have dealt in detail about the description found in Ext.B1 when it was compared with Ext.A2(b) issued to complainant. We have no hesitation to hold that Ext.B1 is not a genuine document and it was manipulated so as to repudiate a genuine claim of the complainant. Though the risk location is shown as 8/53 System and Control, the claim was repudiated on a contention that occupancy was dwellings and others excluding valuables & jewellery was the details of the property insured. It clearly amounts to deficiency of service from the part of opposite party 1 to 4. It has come out in evidence that complainant was running from pillar to post to redress his grievance. He has produced documents obtained from Village office, member of Grama Panchayath, Vice president of Grama Panchayath etc. He had also sent Ext.A7 complaint TO HIS EXELLENCY THE GOVERNOR OF KERALA. The complaint was forwarded to the Deputy Secretary to Government , Government Secretariat for necessary action which is revealed from Ext.A13. Ext.A18series and A19 series shows that he had sent several registered letters to the concerned authorities for redressing his grievance. In said circumstances we are of the opinion that complainant is entitled for compensation for mental agony and we are limiting the same to Rs.1 lakh. These points are found accordingly.
18. Point No. 7:-
In the result complaint is allowed in part.
A) Complainant is allowed to realize an amount of Rs.1,20,000/- along with interest @ 9% per annum from 31/12/2019 (Ext.A1 date of repudiation) till realization from opposite parties 1 to 4.
B) Complainant is allowed to realize an amount of Rs.1,00,000/- as compensation from opposite parties 1 to 4.
C) Complainant is allowed to realize an amount of Rs.5000/- as cost from opposite parties 1 to 4.
The order shall be complied within one month from the date of receipt of this order.
Dictated to the Confidential Assistant, transcribed by him corrected by me and pronounced in open Commission on this the 26th day of March, 2022.
Sd/- Sri.S.Santhosh Kumar(President)
Sd/-Smt. Sholy.P.R (Member)
Appendix:-Evidence of the complainant:-
PW1 - Anilkumar A.(Complainant)
Ext.A1 - Letter dated 31.12.2019 of HDFC ERGO General Insurance
Ext.A2series - Letter of HDFC ERGO General Insurance Co.Ltd.,
Ext.A3 - Report of the Village Officer, Thamarakkulam.
Ext.A4 - Certificate issued by the Village Officer, Thamarakkulam.,
Ext. A5 - Certificate issued by the Member of Mavelikara- . . . Thamarakkulam Grama Panchayat
Ext.A6 - Affidavit of Vice President of Thamarakkulam Grama
Panchayat.
Ext.A7 - Copy of complaint submitted before the Governor of Kerala
Ext.A8 - Copy of paper publication
Ext.A9 - Photograph of fallen tree.
Ext.A10 - Details of Pesonal loan from Kosamattam Finance Ltd.
Ext.A11 - Bill for Rs.2,53,000/-
Ext.A12 series - Copy of Udyog Aadhaar
Ext.A13 - Letter dated 21.04.2020 from the Principal Secretary to
Governor, Kerala Raj Bhavan.
Ext.A14 - Letter from the Kerala Raj Bhavan
Ext.A15 - Letter from the State Public Information Officer.
Ext.A16 - Letter to the State Public Information Officer
Ext.A17 - Letter from Public Information Officer
Ext.A18series - Receipt of Registered letters
Ext.A19 series - Acknowledgement cards
Ext.A20 - Copy of Bankers Cheque
Ext.A21series - Photographs
Ext.A22 - Certificate of Village Officer, Thamarakkulam.
Evidence of the opposite parties:-
RW1 - Senior Manager of HDFC ERGO Gen.Insurance|Co.Ltd.
RW2 - Surveyor and Loss assessor.
Ext.B1 - Policy with conditions.
Ext.B2 - Copy of letter of repudiation
Ext.B3 - Survey Report.
///True Copy ///
To
Complainant/Oppo. party/S.F.
By Order
Assistant Registrar
Typed by:- Br/-
Compared by:-
