By Sri. MOHANDASAN.K, PRESIDENT
The complaint is as follows:-
1. The first complainant is the sister of second complainant Mr. M. Ashraf, who died after filing this complaint and the supplemental complainants Fathima W/o Late Aboobacker, Ramla Beegum M.K W/o Late Ashraf, Nirshad Asiq M.K S/o late AshrafM.K are the legal hairs of deceased second complainant. Supplemental complainants 3 to 5 are mother, wife and child of the deceased Ashraf respectively. The first and second complainants were holding a property of 3.5 cents in R/S 227/2013 of Nilambur Village. They jointly applied for a housing loan from Vijaya Bank, Nilambur, presently Bank of Baroda and took a loan of Rs. 10,00,000/-. The first complainant had given consent letter to the bank and the bank sanctioned the loan. At the time of sanctioned the loan the bank authorities suggested to avail an insurance policy from “Unicon care insurance” from United India Insurance company. Accordingly, they obtained the policy bearing No.1010042618P 101980969 ID 23048923938. The applicant had remitted Rs. 8070/- as premium. Thereafter the opposite party issued the policy to the bank account No. 209808, 581000038 of the complainant. As per the policy the total coverage amount was Rs. 10,000,000/-.
2. The complainant began to construct the house and subsequently obtained first instalment of Rs. 2,50,000/- on 12/03/2018, second instalment of Rs. 2,50,000/- on 31/3/2018 and third instalment of Rs. 1,50,000/- on 05/07/2018. Thus a total amount of Rs. 6,50,000/- was received from the Vijaya Bank. The complainant submitted that the construction of the house was verified and supervised by the concerned Engineer and by the supervising staff of Vijaya bank, Nilambur before passing every instalment of loan. The complainants completed the structure of the house floor after spending the entire loan amount along with an extra amount of Rs. 3,00,000/- which was secured by them through other means. Thus, the complainants invested a total amount of Rs. 9,50,000/- before 2018 July itself.
3. But during the month of August 2018, there was heavy rainfall and natural calamity occurred in Kerala and due to the incessant rain and unexpected flood occurred in the area of Nilambur, the house of the complainant which was under construction collapsed due to the impact of the flood and complainants sustained heavy loss. Immediately the incident was brought to the notice of the government authorities, and they visited the house of the complainant and the loss was assessed and certified that it was caused due to natural calamity. The complainant submitted that they have sustained a total loss of Rs. 5,50,000/- on account of devastating flood.
4. The complainant submitted that after the flood and resultant loss they approached the branch manager of Vijaya Bank, Bank of Baroda, Nilambur and submitted an application for obtaining compensation from insurance company that is United India insurance company Nilambur. The said application was forwarded through the bank being the proper channel to the opposite party insurance company.
5. Though the bank forwarded the application to the opposite party at Nilambur the same was blatantly rejected by the opposite party insurance company stating that the damage occurred to the building was not due to any points mentioned in their policy and there is no fire brigade report. The opposite party further contented that a policy is not covering damages to building in the course of construction and the damages occurred was due to construction default.
6. The complainant submitted that the opposite party insurance company issued the said Uni home care insurance policy after accepting the required insurance premium from the complainants and had issued copy of the insurance certificate and policy having validity from 02/05/2018 to 01/05/2038. The submission of the complaint is that the insurance company is bound to compensate the complainants for any loss, destruction or damage directly caused by storm, cyclone, flood, inundation, tempest etc. The complainant further submit that they had duly informed the bank manager about the loss sustained by them and immediately the bank officials had paid maid a visit to house to take the stock of the situation and the government officials/ village officer and other technical experts also inspected the house and in response to their report the government is taking necessary steps to award the compensation to them. Still the opposite party is reluctant to award any compensation though there is a valid insurance policy. The complainants forwarded an application on 06/08/2018 seeking compensation since there is a valid insurance policy. The complainant submitted application on 06/08/2018 seeking compensation. Subsequently the lender bank had also forwarded another letter dated 01/10/2018 to the opposite party where as the opposite party is repudiating the claim without any genuine or suitable reasons.
6. The complainant alleges the refusal to entertain claim application amounts to deficiency in service and the opposite party being the insurer is bound to abide by the conditions and rules laid down in the policy. The opposite party is bound to verify the claim and make an enquiry in to the facts in the presents of the complainant. The opposite party failed to do the same and they have concocted false document/ report with the aid of their own staff without the knowledge of the complainants with an intended to defect the complainants.
7. The complainant submit that they paid insurance premium of Rs. 8,070/- and since the loss suffered by the insured complainants is caused by the flood and since the peril had taken place during the period of insurance the opposite party is legally bound to compensate the complainants. Hence the repudiation of claim amounts to gaining unjust enrichment at the cost of the complainant. The withholding of legitimate compensation is directly is violation of representation, obligation and undertaking of the opposite party under the provisions of the insurance policy between the complainant and opposite party. So the submission of the complaint is that to direct the opposite party to pay an amount of Rs. 9,50,000/- to the complainant being the expenses incurred by them for rebuilding their house.
8. On receipt of complaint notice was issued from the commission and on receipt of notice the opposite party is entered appearance and filed version denying the entire allegations and averments in the complaint and contenting the complaint is legally not maintainable, devoid of merits and is liable to be dismissed with cost.
9. The opposite party submitted that the complainant had approached this opposite party through M/s Vijaya Bank, Nilambur branch and request to issue “Uni home care insurance policy” to the residential building and the opposite party had issued policy conditions and subsequently the complainant had accepted the policy condition and had remitted the policy premium and the opposite party had issued the policy No.1010042618P1019809691 with policy conditions in favour of complainant for the period commencing from 02/05/2018 to 01/05/2038.
10. The opposite party further submitted that on receipt of information from the complainant, the opposite party had deputed Mr. K.A. Muhammed Kutty, insurance surveyor, loss assuror, valuer and Engineer, ( Fire, mise and engineering) and the above said K.M. Muhammed kutty inspected the residential building of the complainant and reported that it was happened due to construction fault /use of defective material, defective workmen ship and not due to flood and inundation. The opposite party submitted that the policy named uni home care insurance policy ‘is a perils policy and having named perils mentioned under section 1 of the policy schedule which does not include rain damage, construction fault and use of defective. material, defective workmanship and more over fire brigades also had entered the premises and involved in the rescue and fire brigade report reveals the cause of damage and so this opposite party have no liability on the said incident as the damages occurred due to constructional fault/ use of defective material/defective workmanship and this opposite party had repudiated the claim of the complainant and on 04/10/2018 the above fact was intimated to the complainant. The allegation in the complaint is that the incident happened due to the flood and inundation is absolutely false and this opposite party denied the same.
11. The opposite party denied the complainants statements that during the month of August 2018 a natural calamity occurred in Kerala, due to the incessant rain and unexpected flood and the same thing occurred in the area of Nilambur, consequently the house of the complainant, which was under construction was also collapsed due to the impact of the flood and complainants sustained heavy loss and soon after the said loss, the same was brought to the notice of government authorities and they had visited the house of the complainant and the loss was assessed and certified that it was caused due to the natural calamity etc. The opposite party is not liable to pay Rs. 9,50,000/- to the complainant as claimed in the complaint and the complainant is not entitled for the same.
12. The opposite party submit that there is no deficiency in service on the part of the opposite party and no cause of action for the complaint, resultantly complaint is liable to be dismissed with the cost of the opposite party.
13. The complainant and opposite party filed affidavit and documents. Documents on the side of complainant marked as Ext. A1 to A14. Documents on the side of opposite party marked as Ext. B1 to B6. Ext. A1 is copy of loan sanction intimation to the complainant from Vijaya Bank Nilambur dated 12/03/2018. Ext.A2 is copy of the Uni home care insurance policy. No.1010042618P101980969 issued to Vijaya bank, Nilambur branch, by United India insurance company Limited Nilambur, Ext. A3 is Letter having reference No. VB/NB/NGN/49/2018-19 sent to United India insurance company Limited, Nilambur to Vijaya Bank Nilambur, Ext. A4 is copy of Lawyer notice sent by Adv. Usmappa, Manjeri to United India Insurance company limited Nilambur with postal receipt and acknowledgement card. Ext. A5 is copy of repudiation letter sent to the complainants by United India Insurance Company Limited, Nilambur Ext. A6 is copy of building permit issued by Municipality Nilambur dated 23/01/2018. Ext. A7 is copy of property tax issued by Municipality, Nilambur dated 09/09/2019. Ext. A8 is copy of estimate prepared by Mr. Siddique Ali the engineer. Ext. A9 is copy of plan prepared by Mr. Sidique Ali, the engineer. Ext. A10 is copy of incident report No.102/2018 issued by fire and rescue department. Ext. A11 is copy of certificate issued by VEO Nilambur dated 01/10/2018. Ext. A12 is copy of building estimate, prepared by Mr. Sandeep, the Engineer. Ext. A13 is photographs 4 in number of the damaged house of complainant. Ext. A14. Copy of insurance survey report prepared by surveyor K.M.Muhammedkutty dated 10/09/2018. Ext. B1 is Uni home care, insurance policy issued by united India insurance company limited to Ms/ Vijaya Bank Nilambur with policy No.1010042618P101980969 valid from 02/05/2018 to 01/05/2018. Ext. B2 is copy of reputation letter issued by the insurance company dated 04/10/2018. Ext. B3 is copy of the complaint submitted by the complainant before the district legal service authority. Ext. B4 is copy of reply submitted by the opposite party, before the legal service authority dated 08/03/2019. Ext. B5 is copy of lawyer notice issued by Adv. N. Usmappa to the opposite party. Ext. B6 is copy of reply notice issued to the Adv. N. Usmappa by the insurance company. The insurance surveyor Mr. MuhamedKutty was examined as PW1.
14. Heard both side, perused affidavit and documents. Both side filed argument notes also. The following points arise for consideration: -
1) What is the reason for collapse of the house of the complainant?
2) Whether the house was covered as per the insurance policy?
3) Whether there is deficiency in service on the part of the opposite party?
- Relief and cost?
15. Point No.1
The admitted case is that the complainant availed housing loan from the Vijaya Bank and presently known as Bank of Baroda which was covered by insurance policy issued by the opposite party called Uni home care insurance. The policy number is 1010042618P101980969 ID23048923938. The policy period was from 02/05/2018 to 01/12/2038 i.e., for 20 years. The applicant had remitted Rs.8070 as premium. The opposite party issued the policy to Vijaya Bank Nilambur which is evident from Ext. B1.
16. The dispute is that the insured house of the complainants collapsed due to heavy rain fall which is not covered by the insurance policy.
17. The complainant submits that during the month of August 2018 there was heavy rain fall and flood in Kerala including Nilambur Panchayat, where badly affected. There was heavy rain fall in the vicinity of the appellants residence. Due to the impact of the heavy rain fall the house of the complainant also collapsed and they sustained heavy loss. Immediately after the collapse of the house, the appellants informed the respective government officials. The government officials inspected the area and certified that the loss was due to heavy rain. The complainant submits that due to the incessant rainfall the applicant sustained a loss of Rs.9.50000/-. The complainants contacted the branch manager of Vijaya Bank and filed a petition for getting insurance claim. Then the bank forwarded the application to the opposite party insurance company. But they repudiated the claim stating the reason that “the reason for the loss was not coming under the reasons stated in their policy “and further stated there was no fire brigade report with respect to the incident, and also claimed that the work of the house was yet to be completed and the reason for the collapse was the “defective construction”.
18. The complainant produced Ext. A6 building tax, Ext. A7 tax receipt, Ext. A10 report of fire and rescue department. Ext A11 certificate of village officer and Ext. A3 photographs of the collapsed building. Ext, A7 report issued by the fire and rescue department states that one portion of the house of the complainant totally damaged due to heavy rain and the residence of the house has been shifted from the house due to the security reason. So, it is not correct to say that there was no report from fire and rescue department. Ext. A11 certificate of the village officer also states that the house of the complainants collapsed due to natural calamity occurred on 06/08/2018. So what can be inferred from the above referred document is that there was a natural calamity and due to the natural calamity the house of the complainant was collapsed. Ext. A3 is copy of intimation served by the Vijaya Bank to the opposite party and which reveals that there was proper intimation of the incident to the opposite party. Due to inaction on the part of the opposite party the complainant caused lawyer notice Ext. A4, to the opposite parties but the same was not admitted by the insurance company through Ext. A5. So, from the above referred documents submitted by the complainant we arrive a conclusion that the house of the complainant collapsed in the natural calamity occurred during 2018 August throughout Kerala, especially the Nilambur Grama Panchayat where in the house of the complainant situate.
19. Point No.2
The specific contention of the opposite party is that the alleged reason for collapse of the house of complainant is not covered as per the insurance policy, Ext B1 issued to the complainant. The submission of the opposite party is that the reason shown for the collapse of the house is not covered as per policy Ext. B1 section I to XI. The opposite party submitted that the policy issued to the complainant is not covering the damages to the building in course of construction and this damage occurred to the building seems to be due to construction defects / weak constructions / use of defective materials / defective workmanship. But it can be seen that the housing loan was issued by the Vijaya Bank and through the Vijaya Bank insured the house of complainant which is covering from 02/05/2018 to 01/05/2038. The concerned bank had already issued three instalments worth Rs.65000/- rupees to the complainant on completion of work to that extent. The complainant has got a contention that they had invested further 300000/- rupees towards the construction expense of the building. So, we do not find correct that the contention of the opposite party, at the relevant time there was no insurance coverage for the house since the building was in the course of construction. The allegation of the opposite party that construction defect/weak construction / use of defective materials / defective workmanship are irrelevant and which is not supported by any sort of valid documentary evidence. It is relevant to note that the insurance policy was taken through the bank, and if there was no an insurable interest, the policy could not have issued by the opposite party.
20. The contention of the opposite party is that the damages / the loss sustained to the complainant is not covered by the policy as per section 1 clauses 1 to 11. But Ext. B1 reveals that section 1.VI that loss, destruction or damage directly caused by storm, cyclone, Typhoon, tempest, hurricane, Tornado, Flood, inundation, earth quake, fire and shock are covered by the policy. So the clause VI states that flood is covered under the policy. Now it can be seen that the case of the opposite party is that one of the reasons for collapse of the building is heavy rain fall and that cannot be treated as flood.
21. The counsel for complainant placed dictums lay down by the Apex Court as well as National Disputes Redressal Commission on the policy here in dispute. The definition of “flood and inundation”. The word flood cannot be under stood in a narrow sense to refer only to the overflowing of water body, and to exclude instances where over following of water occurs due to excessive rainfall. It was observed on pluvial floods which occur independently of a water body, it is clear that floods are not restricted to over flow of water bodies. The counsel for the complainant placed decision of the Apex Court in civil appeal No.7402 of 2009 dated 28/01/2020. The above said decision referred the cases Bajaj Alliance General Insurance company Limited VS Mas Guandmal Hardyal Mall , ( 2009) NCDRC 127, II Oriental insurance company Limited Vs M/s Sathynarayan Shetty and sons, (2012) NCDRC 124, and III oriental insurance company limited VS M/s RP bricks (2013) NCDRC 494. It was held in the decisions that the word flood also mean an out outpouring of water : and Tornado , Beside other means, : a great down pour of water : . In view of the above judgements there is no relevant for the contention of the opposite party that the policy is not covering the damage sustained to the complainant.
22. So, the contention of the opposite party that heavy rain fall cannot be treated as part of flood is absolutely baseless and which cannot be uphold at all. So we find that the damage caused to the house of the complainant is due to heavy rainfall which is part of flood and the documents substantiated the same. It is also notable that there was unforeseen natural calamity through flood all over the state as stated by the complainant during the period august 2018. So, we find that the house of the complainant met with natural calamity happened in the month of August 2018 and so the complainants are entitled insurance coverage as per Ext. B1 policy.
23. Points 3 &4
It can be seen that the complainants herein duly reported the incident of collapse of house duly to the bank, in turn the bank communicated the fact to the opposite party. But the opposite party deputed surveyor Mr. K.M. Mohamed to conduct survey and to file assessment report regarding the damages sustained to the complainants. He filed a report also before the opposite party.
24. The conclusion of surveyor’s report is as follows: - “it is emphatic fact that our state has suffered unconceivable loss due to recent natural calamity and still struggling to out come from the interminable damage. Due to the severe and continues rain fall during June to August 2018 our state has faced most distress challenge. Most of the districts have been severely affected by losing men, land and properties. Similarly due to the recent disaster, several losses of land properties have been reported from this region also. The above said residential building has been sustained major damage to its both floors. Since repair is insecure and uneconomical demolishment and reconstruction is necessary. Considering the afore mentioned fact and findings claim may please be settled subject to the existing policy conditions”. Ext. A14 the surveyor of the insurance company as categorically reported that the incident could have been occurred obviously due to nothing other than continuous and heavy rain fall. He also stated that on consultation of an expert civil engineer ,the repair of the damaged house in more than impossible , rest of the broken areas has required be demolishing and removing by using heavy machineries and re construction from the beginning is necessary. The insurance surveyor was examined as PW1 who reiterated the contentions in Ext. A14.
25. It can be seen from the Ext. A14 the claim of the complainant was genuine and the contention of the opposite party was without any merit. It is also pertinent to note that the insurance surveyor duly submitted the report before the insurance company but they did not produce the insurance survey report before the commission as part of their evidence. So, what appears is that the insurance company, the opposite party wilfully suppressed facts and denied the genuine claim of the complainant contenting that the policy is not covering the damage sustained to the house of the complainants.
26. The insurance surveyor suggested that repair is insecure and uneconomical, demolition and re-construction is necessary. He estimated total sum of Rs.5,97,800/- for the same. The surveyor also considered the estimate submitted by the insured as cost of house Rs.12,00,000/-, whereas insured for Rs.10,00,000/- only. So according to the surveyor the assessed net amount is Rs.4,98,167/-. The complainant on the other side filed an estimate for Rs.12,00,000/-. But we accept the version of the insurance surveyor and finds that the complainant is entitled for the sum assed by the insurance surveyor, which is Rs. 4,98,167/-. It can be seen that the insurance surveyor duly submitted his report on 10/09/2018 itself. As per the policy itself the insurance company is liable to consider the claim and settle the dispute within in 15 days of receipt of the same. Hence, we find that the opposite party is liable to pay the sum as assessed by the insurance surveyor. It is also just and reasonable to settle all the genuine insurance claim within in stipulated time as specified in Ext. B1 document. The delay in settling the claim amount also amounts deficiency in service. So in this case the complainant is entitled interest for the amount assessed by the insurance surveyor from the date of Ext. A14 insurance survey report dated 10/09/2018 @ rate of 9% per annum till payment. It is to be noted that the grievance of the complainant is that his house was collapsed in flood occurred during 2018 August. He availed the loan from the bank for the construction of his house. So, the delay caused in settling the insurance claim by the opposite party definitely have resulted inconveniences, hardship and mental agony to the complainants. Hence the opposite party is directed to pay Rs.1,00,000/- as compensation to the complainant. The commission also allow Rs.10,000/- as cost of the proceedings.
27. In the light of above facts and circumstances the complaint stands allowed as follows: -
- The opposite party is directed to pay Rs.4,98,167/- to the complainant as per the Ext. A14 document with interest at the rate of 9% per annum from 10/09/2018 till date of payment .
- The opposite parties directed to pay Rs.1,00,000/- as compensation on account of deficiency in service on the part of opposite party and thereby caused inconvenience, hardship and mental agony suffered by the complainant.
- The opposite party is also directed to pay Rs.10,000/-as cost of the proceedings.
The opposite parties shall complies this order within one month from the date of receipt of copy of this order, failing which the opposite party is liable to pay interest on the above said entire amount at the rate of 12% per annum from 10/09/2018.
Dated this 28th day of November, 2022.
MOHANDASAN K., PRESIDENT
PREETHI SIVARAMAN C., MEMBER
MOHAMED ISMAYIL C.V., MEMBER
APPENDIX
Witness examined on the side of the complainant: PW1
PW1: Mr. MuhamedKutty (insurance surveyor)
Documents marked on the side of the complainant: Ext.A1to A
Ext.A1: Copy of loan sanction intimation to the complainant from Vijaya Bank
Nilambur dated 12/03/2018.
Ext.A2: Copy of the Uni home care insurance policy No.1010042618P101980969
issued to Vijaya bank Nilambur branch by United India insurance company
Limited Nilambur,
Ext A3: Letter having reference No.VB/NB/NGN/49/2018-19 sent to United Indian
insurance company Limited Nilambur to Vijaya Bank Nilambur
Ext A4: Copy of Lawyer notice sent by Adv. Usmappa Manjeri to United India
Insurance company limited Nilambur with postal receipt and
acknowledgement card.
Ext A5: Copy of repudiation letter sent to the complainants by United India
Insurance Company Limited, Nilambur
Ext.A6: Copy of building permit issued by Municipality Nilambur dated 23/01/2018.
Ext.A7: Copy of property tax issued by Municipality Nilambur dated 09/09/2019.
Ext A8 : Copy of estimate prepared by Mr. Siddique Ali the engineer .
Ext A9: Copy of plan prepared by Mr. Sidique Ali the engineer
Ext A10: Copy of incident report No.102/2018 issued by fire and rescue department. Ext.A11: Copy of certificate issued by VEO Nilambur dated 01/10/2018.
Ext.A12: Copy of building estimate prepared by Mr. Sandheep the Engineer .
Ext A13: Photographs 4 in number of the damaged house of complainant.
Ext A14: Copy of insurance survey report prepared by surveyor.
K.M.Muhammedkutty dated 10/09/2018.
Witness examined on the side of the opposite party: Nil
Documents marked on the side of the opposite party: Ext. B1 to B6
Ext.B1: Uni home care insurance policy issued by united India insurance company
limited to Ms/ Vijaya Bank Nilambur with policy No.1010042618P101980969
valid from 02/05/2018 to 01/05/2018.
Ext.B2: Copy of reputation letter issued by the insurance company dated
04/10/2018.
Ext.B3: Copy of the complaint submitted by the complainant before the district legal
service authority .
Ext.B4 : Copy of reply submitted by the opposite party before the legal service
authority dated 08/03/2019 .
Ext.B5: Copy of lawyer notice issued by Adv. N. Usmappa to the opposite party.
Ext. B6: Copy of reply notice issued to the Adv. N. Usmappa by the insurance
company.
MOHANDASANK., PRESIDENT
PREETHI SIVARAMANC., MEMBER
MOHAMED ISMAYIL C.V., MEMBER
