Dharwad: The District Consumer Grievances Redressal Commission has slapped a fine of Rs 8 lakh on a private insurance firm for denying claim to a policy holder.Manikchand Jain, a cloth merchant from Lakshmeshwar in Gadag district, had insured his two shops and the stock of clothes in them with the Oriental Insurance Company, Hubballi.Lakshmeshwar CMC carried out an eviction drive to clear encroachments in the market. During this operation, parts of two of Jain’s shops were demolished. Taking advantage of this situation, some miscreants broke into his shops, stole clothes and other property, causing him a loss of about Rs 20 lakh. Jain submitted a claim application to Oriental Insurance Company, Hubballi, with supporting documents, seeking compensation as per the terms of the insurance policy.However, the insurance company, after conducting an inquiry and based on a report given by its lawyer, rejected the Jain’s claim. Jain approached the District Consumer Grievances Redressal Commission saying that the insurance policy covering the shops was valid and hence the company was bound to pay compensation. The rejection of the claim amounted to deficiency in service, said Jain and filed a a case before the Commission.After a thorough hearing, Commission chairman Ishappa Bhute and member Vishalakshi Bolashetti observed that the complainant had indeed taken insurance policies from insurance company for his shops. These policies included coverage for theft-related losses. Evidence submitted proved that miscreants had taken advantage of the eviction drive and stolen stock from the complainant’s shop. Since theft caused the complainant’s loss, the insurance company was liable to compensate him as per policy conditions.Rejecting the claim was therefore held to be a deficiency in service by the insurance company, the Commission ruled.The complainant had demanded Rs 20 lakh compensation, but since the policy was only for Rs 16 lakh, and the Commission assessed the loss to be around Rs 8 lakh, it ordered Oriental Insurance Company, Hubballi, to pay Rs 8 lakh compensation to the complainant within one month of the judgment.If the company failed to comply within a month, it would have to pay the Rs 8 lakh with 10% interest from the date of judgment until payment, the Commission directed.
