Firm to pay over Rs 18L for arbitrarily refusing claim

An insurance company, which had repudiated claim for jewellery on the ground that the owner did not have its valuation certificate, has been asked to pay over Rs 18 lakh by a consumer forum here, which said the question had to be raised at the time of issuing the policy.
The New Delhi District Consumer Disputes Redressal Forum, presided by C K Chaturvedi, asked The Oriental Insurance Company Ltd to pay Rs 18,25,520 to one Praveen Kumar Sharma, while holding it guilty of "deficiency in arbitrarily refusing the claim and denying its liability".
The forum passed the order while noting that the policy covered all the risks for loss by accident or misfortune and did not exclude liability in case of not taking care of the lost items.

"The Opposite Party (insurance company) cannot question loss which includes loss by misfortune as covered in policy... OP cannot, after loss, raise question of value of jewellery or valuation or source of purchase or fact of complainant having it or not," the forum said, adding the company was bound to reimburse insured sum only, irrespective of the present value of the jewellery/gold.
It, further, said that if the company simply accepted the vouchers and insured the jewellery by charging premium, how it can now turn around to say that he had not purchased the jewellery, as stated in repudiation letter.

It directed the company to pay Rs 18,25,520, including a compensation of Rs 50,000 for deficiency and litigation expenses.
Sharma had told the forum that in January, 2010, he lost the jewellery of his wife while taking it to a shop and subsequently an FIR was lodged in this regard and insurance company was informed.
The company, however, had contended before the forum that the claim was not admissible as he did not take reasonable care of insured items to prevent the loss and said that it did not obtain the valuation certificate.