Fines for seeking wrong claims

Ganesh Anand Bhat, the proprietor of Shree Ganesh Agencies, owned two adjacent shops at Mulund. However, he had taken a shopkeeper's insurance policy from New India Assurance which covered only one shop.

A fire occurred in which both the shops were gutted, and the goods stored were destroyed. Bhat lodged an insurance claim. A surveyor was appointed who assessed the loss for both the shops but observed that the claim would be payable only for one shop which had been insured. The claim was settled by paying Rs 21,16,666, which was accepted by Bhat without protest.

Bhat later filed a complaint before the Additional Forum for Mumbai Suburban District, contending that he should also be reimbursed the loss pertaining to the other shop. The Forum dismissed the complaint on the ground that the discharge voucher showed that the claim had been accepted in full and final settlement without any protest or objection.

Bhat challenged this order before the Maharashtra State Commission. He attempted to make out a new case that both the shops were covered under the policy, but there was a mistake in mentioning only one shop. During the pendency of the proceedings, Bhat expired. His widow Rekha and daughters Varsha and Anushka continued with the litigation as the legal heirs.

Sapna Bhuptany, the Advocate defending New India Assurance, argued that since only one shop was covered under the policy, the refusal to pay for the loss in respect of the other shop was justified. She argued that refusal to settle a claim for the shop which was not insured could not be termed a deficiency in service or unfair trade practice. Besides, once the claim was accepted in full and final settlement without lodging any protest, the insured could not be permitted to raise any dispute subsequently.

By its order of March 13, 2019, delivered by Justice A P Bhangale for the bench along with S K Kakde, the Maharashtra State Commission concurred with Advocate Sapna Bhuptany's arguments. The Commission considered the claim in respect of the second shop to be bogus and contrary to the coverage mentioned in the policy. Since the appeal was filed to pursue a fraudulent claim for the other shop which was not insured, the State Commission dismissed the appeal with costs of Rs 5,000 payable by Bhat to the insurance company.

To conclude, a policy must be scrutinised when it is received. Contending that the policy contains mistakes after a claim arises will not be believed. The claim has to be settled within the scope and ambit of the coverage mentioned in the policy.

The writer is a consumer activist