Insurance co. Asked to compensate DSCSC in 2002 loot case

A district consumer forum has directed an insurance company to compensate Delhi State Civil Supplies Corporation (DSCSC) which was looted of over Rs two lakh by some miscreants in 2002, saying denial of the claim was "gross deficiency" in service.
The forum also directed the United India Insurance Company Limited to pay Rs 11,000 towards the legal expenses incurred by the corporation.
"This is a case of gross deficiency in service on part of the insurance company in not allowing the genuine claim of the Complainant (DSCSC).
"We hold the company guilty of gross deficiency in service and direct it to pay Rs 2,26,598 alongwith interest at the rate of 6 per cent per annum from April 16, 2002 till the date of recovery and Rs 11,000 towards legal expenses to the complainant (corporation)," the forum said.

According to the complaint filed by the DSCSC, an amount of Rs 2,26,598 was looted by unidentified persons on April 15, 2002 from its Brahmpuri liquor vending unit and the insurance company was informed about it the next day.
It said it had submitted all required documents to the insurance company many a times, but to no effect.

On July 29, 2009, the insurance firm informed the DSCSC that no claim was pending/outstanding in their books and no claim papers were lying with them.
The company claimed it had sent a repudiation letter in 2006 but the DSCSC had not taken any action thereafter.

However, the forum observed that the words "year 2006" are very vague as no particular date or month of the alleged repudiation letter has been mentioned.
"Therefore, we are not inclined to believe that the insurance company had infact sent any such alleged repudiation letter to the complainant in the year 2006," forum said.
"We do not have any hesitation in saying that the firm has infact taken a false and frivolous plea in order to save the skin of its erring officers," it observed.