Baramulla District Commission Orders National Insurance Company to Compensate for Earthquake Damages, Awards Rs. 6 Lakhs Compensation
The Baramulla District Consumer Disputes Redressal Commission, led by Peerzada Qousar Hussain (President) with Ms. Nyla Yaseen (Member), found the National Insurance Company responsible for unfair practices under Section 12 of the Consumer Protection Act 1986. The complaint filed by residents of Usman Colony in Baramulla claimed that the insurance company did not provide an insurance...
The Baramulla District Consumer Disputes Redressal Commission, led by Peerzada Qousar Hussain (President) with Ms. Nyla Yaseen (Member), found the National Insurance Company responsible for unfair practices under Section 12 of the Consumer Protection Act 1986. The complaint filed by residents of Usman Colony in Baramulla claimed that the insurance company did not provide an insurance claim for their insured house after it was damaged by an earthquake. Consequently, the commission allowed the complaint directing the insurance company to pay Rs. 6 lakhs, along with 10% interest for the house damage, as well as Rs. 50,000 for the distress caused.
Brief Facts
Mohd Maqbool Bhat along with his wife (Complainants) filed a complaint against the National Insurance Company (Opposite Party). They had insured their house and belongings against various risks, including earthquakes. When an earthquake hit on 08-10-2005, their house was damaged. Mohd Maqbool contacted the insurance company for claim settlement, removed debris as advised, and awaited a surveyor. However, the insurance company denied his claim, alleging the house was already in a dilapidated state before the earthquake.
Arguments by the National Insurance Company
The National Insurance Company argued that the complaint was not valid because earthquakes were not covered under the policy. They said the complainants' house was already old and being demolished, so the earthquake didn't really cause the damage. They also brought witnesses to support their case. These witnesses said the house was already being demolished before the earthquake, so the damage couldn't be blamed on it.
Observations of the Commission
The commission reviewed the records and found that the complainants had bought an insurance policy for their house, but it got damaged in an earthquake. When they tried to claim insurance, they were advised by the insurance company to remove debris before a surveyor arrived. Even though the surveyor said that the house was already damaged, the insurance company couldn't prove that the house was in bad condition before the earthquake. Further, witnesses and a certificate from the Tehsildar confirmed the damage was indeed due to the earthquake.
Based on these observations, the commission decided that the insurance company had a duty to settle the complainants' claim for the earthquake damage. Denying the claim amounted to an unfair trade practice on their part. So, the commission ordered the insurance company to pay Rs. 6 lakhs to the complainants for the damage caused by the earthquake, along with 10% interest from the date of filing the complaint. Additionally, the insurance company was directed to pay Rs. 50,000 to the complainants for the mental and physical stress caused, as well as for litigation charges.
Case Title: Mohd Maqbool Bhat & Ors. vs. National Insurance Company Ltd.
Counsel for the Complainants: Mr. H. A. Wani, Advocate
Counsel for the Opposite Parties: Mr. F.D. Bhat, Advocate
Click here to Read/Download the Order