‘Small fire enough for insurance claim’

The Supreme Court has ruled that insurance has to be paid for the damage caused by a fire that lasted just for a fraction of second and not long.

The Supreme Court has ruled that insurance has to be paid for the damage caused by a fire that lasted just for a fraction of second and not long.

HT Image

“As long as there is a fire which caused the damage, the claim is maintainable, even if the fire is for a fraction of a second,” the court said.

A bench headed by Justice Markandey Katju upheld a National Consumer Disputes Redressal Commission’s decision in the case of agri-inputs firm Zuari Industries and said it was the incident of fire and not the duration that was required for claiming compensation from the insurance companies.

According to the court, there was no direct decision of the apex court on the issue of the proximate cause of the damage due to fire.

It said that various decisions of the foreign courts and a predominant view appeared to be the proximate cause was not the cause which was nearest in time or place “but the active and efficient cause that sets in motion a train or chain of events which brings about the ultimate result without the intervention of any other force working from an independent source.”

Justice Katju dismissed the insurance companies plea and said the fire was the efficient and active cause of the damage.