Mumbai: The state consumer commission has directed The New India Assurance Company to pay Rs55.30 lakh with interest to owners of a vessel that sank off Iran's coast. The 9% per annum interest to be paid from November 2000 amounts to over Rs1.14 crore. The insurance firm had not considered the surveyor report and rejected the claim stating that the ship sank within two days of taking insurance.
The firm also suspected that the ship had already sunk and the insurance was taken later with the vessel carrying cargo from Iraq that was banned as per the then United Nations Resolution. The claimed money that was directed to be given with further compensation of Rs1.50 lakh came to be given only after the case was referred back to the state commission after the National Commission asked it to hear it. The state commission had earlier rejected the complaint stating that the complainant had not cooperated with the insurance firm and the surveyor.
Case against The New India Assurance Company
The order dated August 2 was passed on a complaint of Khatubai Rumi and Kasam Rumi (since deceased and represented by six legal heirs) against The New India Assurance Company with headquarters in Mumbai and a field office in Gandhidham.
Rumis owned a vessel called MSVAnnasagar. They had taken an insurance cover called Marine Hull Insurance policy from November 2, 200 to November 1, 2001. It was the first time they took the insurance cover after vessels in their village met with an accident. A survey of the vessel was conducted to gauge its fitness and worth. The said insurance policy covered all accidents and damages and the spare parts of the vessel. The complainants paid the premium amount of Rs17,207 and insured the vessel for Rs55.30 lakh. On November 5, 2000, the vessel met with an accident and sank on its way to Dubai from Iran. All crew members were rescued by another vessel before it sank with 125 metric tonne of dates it was carrying from Iran to Dubai.
The complainants informed the insurance firm and a surveyor was appointed. However, despite correspondences between the Rumis and surveyor and the insurance firm that went on till August 2004, the claim was not cleared.
Issues raised by insurance firm
The insurance firm raised objections ranging from complainants not providing marine Casualty Report endorsed by Mercantile Marine Department, vessel was unnecessarily anchored off Iran when others were sailing and weather was fine, coming with unclean hands, matter was complicated and technical with legal issues, and vessel had sunk prior to taking policy among others. When the matter first went to the state commission, the complaint was rejected on the ground that the complainants did not comply with the insurance firm and surveyor. The complainants then approached the National Commission, which referred the matter back to the state commission to hear it afresh.
Commission cites findings from surveyor's report
During the hearing, the commission, citing surveyor's report observed, “Since the casualty has taken place in the foreign waters which had limitation for our enquiry and investigation, the actual cause, the date and the location of the incident could not be established beyond doubt..... documentary evidences and the statements, we had obtained from the various concerned personnel it could reasonably be inferred that the incident had occurred due to heavy weather as prevailed on 04/05-11-2000.” The commission stated that the insurance firm could not prove that cargo was from Iraq.
It added that “through the report of the surveyor it is established that the vessel was seaworthy at relevant time and it met with an accident due to the adverse/bad weather and it sank but crew members were rescued by another vessel....The opponent did not repudiate the claim within reasonable time and thereby committed deficiency in service.” Citing case laws, the commission stated that the survey report has significant evidentiary value unless proved otherwise and that a claim be accepted or rejected within 30 days, which had not happened in the case. The claim was repudiated in 2005 but complaints were informed only in 2010, which was again deficiency in service and unfair trade practice, which the complainants were able to prove beyond doubt.
.jpg)
