The State Consumer Disputes Redressal Commission, Chandigarh, has upheld findings of deficiency in service against Oriental Insurance Company Ltd. and directed it to pay ₹1.24 crore along with interest to Derabassi based Chereso Life Sciences Pvt Ltd in a dispute arising from a major factory fire in January 2023.
According to the order, a fire broke out at the company’s manufacturing unit on January 13, 2023, causing extensive damage to stock and other assets. Chereso Life Sciences lodged an insurance claim of over ₹2.28 crore. After investigating the matter, the insurer’s surveyor assessed the net admissible loss at ₹32.03 lakh, which was paid to the company in July 2023.
The company accepted the payment “under-protest” and approached the consumer commission, alleging that the claim had been grossly under assessed. It argued that a key employee responsible for stock records had suffered burn injuries in the incident and was hospitalised, preventing the immediate preparation of a complete inventory of damaged goods. Additional details of the losses were later submitted to the insurer.
The District Consumer Commission had earlier accepted the company’s plea and directed the insurer to pay ₹1.82 crore with interest. Challenging the decision, Oriental Insurance contended that the surveyor’s report had been ignored and that the claim had already been settled through a discharge voucher executed by the company.
{{/usCountry}}The District Consumer Commission had earlier accepted the company’s plea and directed the insurer to pay ₹1.82 crore with interest. Challenging the decision, Oriental Insurance contended that the surveyor’s report had been ignored and that the claim had already been settled through a discharge voucher executed by the company.
{{/usCountry}}The state commission rejected these arguments, observing that acceptance of the payment under protest did not amount to a full and final settlement. It held that the insurer had under-settled the claim and was therefore deficient in service. However, the state commission found that the district commission had failed to deduct the ₹32.03 lakh already paid by the insurer.
After making the adjustment, it recalculated the payable amount at ₹1,23,86,436 and directed the insurer to pay the sum with 9% annual interest from July 19, 2023, until realisation. The commission also allowed reimbursement of the admissible GST component subject to submission of supporting documents.