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Ignore rules in calamity times, pay claims: SC to insurance firms


New Delhi, Oct 10 :

The Supreme Court Friday said that the rules and regulations governing the payment of insurance claims could be not come in the way of people of Kashmir who lost their properties in the recent devastating floods that had hit the state.

A bench of Chief Justice H.L.Dattu, Justice S.A. Bobde and Justice Abhay Manohar Sapre said this as it declined to interfere with the Jammu and Kashmir High Court’s order directing the insurance companies to pay 95 percent of a claim up to Rs.25 lakh and 50 percent in respect of claims above Rs.25 lakh.

Supreme Court of India
Supreme Court of India

“Sometimes we have to ignore the rules and regulation (for paying insurance claims) in the interest of the people suffering from natural calamities,” the court said.

It refused to accede to repeated submissions by Attorney General Mukul Rohatgi and senior counsel M.N. Krishnamani seeking a month’s time to carry out the survey of the insurance claims by the people who lost their belongings in the unprecedented floods that hit the state.

“The chief justice of the high court has seen the tragedy with his own eyes and he is justified in passing the order. Not one shop can be opened at Lal Chowk. There is no shop in Lal Chowk,” Chief Justice Dattu said, justifying the high court order on the payment of the insurance claims without carrying out mandatory verification of the claims.

“We are not going to change even a word from the high court order,” he said, brushing aside all submissions seeking a hold on the high court order.

The court disagreed, saying “It is not true”, as Attorney General Rohatgi told the court that over 5,000 surveyors were working on the verification of the insurance claims.

“We can’t accept your statement,” the court told Rohatgi as he sought time till Nov 30 to verify claims. “We will settle all the claims by November 30, but it has to be after certain verification,” he said.

Krishnamani, who appeared for four general insurance companies, urged the court that the high court’s order may be watered down to allow the firms to pay 50 percent of the claims up to Rs.25 lakh and 30 percent of the claims above Rs.25 lakh.

The court was told that up to Thursday, the four insurance companies – United India, National, Oriental India and New India – have received 9,917 claims of an estimated amount of Rs.980.49 crore and have already made 983 cheques of total amount of over Rs.25.104 crore.

While declining to interfere with the order of the high court, which is operating from a makeshift accommodation, Chief Justice Dattu told Jammu and Kashmir Advocate General Mohammad Ishaq Qadri to take all the steps to ensure that the high court operates fully from Oct 13 with the supply of electricity.

The court refused to accept Qadri’s claim that high court was being supplied electricity. Chief Justice Dattu said that till Thursday evening there was no electric supply.

It also asked Qadri to take steps for an alternate accommodation for the high court’s chief justice whose house has become inhabitable after it was inundated with flood waters.