Excelsior Correspondent
Srinagar, Oct 1: Jammu and Kashmir High Court today directed the Insurance Companies to pay at least 50 percent interim relief to the people whose insured houses and cars were destroyed or damaged in the floods. The court has also expressed displeasure over pace of settling the claims by the Insurance Companies as they have settled only 270 claims out of around 8, 000.
The Division Bench of the Court comprising Chief Justice MM Kumar and Justice Ali Mohammad Magrey after perusal of compliance reports by the Insurance Companies directed that policies involving Rs 25 lakhs or less and amount exceeding Rs 25 lakhs shall be entitled for 95 percent amount and 50 percent amount respectively.
“In respect of insurance policies involving Rs 25 lakhs or less, we reiterate Court order dated: 26.9.14 and 50 percent of the assured amount shall be paid as has been directed “, the Court directed.
The Court in its fresh order today covered houses and motor vehicles which were hit by the recent flood under this order and directed that it would also apply to the houses and motor vehicles.
“We also wish to observe that the order shall also apply to the properties and houses which have been completely damaged by the floods. Additionally those orders shall also apply to the insurance involving motor vehicles”, directed the Court.
Observing the pace of settling the claims of the flood hit victims, the Court expressed its complete dis-satisfaction and said time is the crucial factor and practically it is not possible to depute adequate number of surveyors for such a large number of claims which may take years.
“Reports of companies reinforce our view that dependence on preliminary survey reports is likely to take long time as has been observed in earlier order”, observed the Bench.
The Court has expressed its displeasure over the slow pace of work by Insurance Companies in settling the claims. Companies in their status reports have said that out of 2431 claims only 26 have been settled by United Insurance Company and out of 2962 claims 85 have been settled by National Insurance Company, and in total out of 7966 claims by four companies only 270 have been settled till date.
Rejecting the plea taken by some Insurance Companies that clause of exceeding amount shall be modified, Court said the cap of 50 percent by no stretch of imagination could be recorded as excessive and no case is made out for modification of earlier directions. “Prayer made by four Public Sector General Insurance Companies is rejected”, said the Bench.
Court further said: “The compensation may stem from many other heads like loss of earnings during the period of flood in case of shopkeepers policy. The displacement of house owners by staying in rental accommodation and hiring of vehicle in case of motor vehicle destruction.”
Court has asked the companies with regard steps taken regarding general awareness to educate the people regarding services to be provided and also guiding them about the claims.
Court directed all the respondents for filing of compliance of directions issued by the court on September 26 by or before October 10.
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