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HC reiterates its order to insurance companies on interim relief, extends it to damaged houses, motor vehicles | | |
SRINAGAR, Oct 1: While reiterating September 26 order regarding interim relief to flood-affected shopkeepers in the state, the Jammu and Kashmir High Court today made it applicable to total destruction of houses/properties and to the motor vehicles. As per the order, the court had directed the insurance companies to pay 50 percent of insured amount for policies above Rs 25 lakh and 95 percent for policies below Rs 25 lakh as interim relief to the flood-affected shopkeepers. "The cap of 50% by no stretch of imagination could be recorded as excessive. Moreover, it has been made subject to an undertaking by either side to make up the deficiency at the time of final settlement," a Division Bench comprising Chief Justice M M Kumar and Justice Ali Mohammad Magray said while dismissing application for modification of court order passed on September 26. The court passed the direction after perusal of compliance report by the Insurance Companies namely National Insurance Company, New India Assurance Company, United India Insurance Company, and Oriental India Insurance Company. In the compliance report, the companies said that they have received total number of 7966 claims and out of them have been able to finalize only 270 claims. "The reports reinforce our view that dependence on preliminary survey reports is likely to take long time as has been observed in our order dated (September 26, 2014)," the Division Bench said. "In the wake of the misery created by unprecedented flood, the 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 as has already been observed in the 26-09-2014 order," the bench said. The court had directed that policy in respect of shopkeepers taken at a meeting of GIPSA by the insurance companies needs to be effectively implemented.
Under the caption 'Stock Loss', the meeting had contemplated that cases with sum insured is up to Rs 25 lakh, then after making 5 percent deduction towards dead and obsolete stocks is to be considered as the basis of settlement.
Elucidating the court had observed in the order 95 per cent of the sum insured has to be disbursed in case of policy involving Rs 25 lakh or less. In case of the policies with sum insured up to Rs 25 lakh, the court had directed that 50 percent of the assured amount shall be released after receiving undertaking from the insured and also filing of the undertaking by the officer concerned of the insurance company The Court directed the four insurance companies to file compliance report by the next date of hearing on October 10.
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