Page 49 - Insurance Times September 2020

LEGAL

Vehicle Insurance

Insurer is liable to pay for loss due to would be payable as the policy covered all risks. It held the
insurer liable for deficiency in service and ordered it to pay
defective packaging Rs. 12,94,731 (inclusive of salvage), along with 12 per cent
Dujodwala Products, a company engaged in manufactur- interest from February 10, 2008 onwards. Additionally, Rs.
ing chemicals for local as well as export markets, received 50,000 was awarded as compensation and Rs. 5,000 to-
an order for products from Saudi Rook Wool Factory at wards litigation costs.
Riyadh. As the product was sensitive to atmosphere, the National Insurance appealed against the order to the
temperature had to be maintained at 5°C or less. Dujodwala Maharashtra State Commission. The latter observed that
hired a container from Maersk India, which had a built-in
even though the policy covered all risks, it excluded dam-
refrigeration system. The consignment was packed in 109 age caused due to packing. So, it concluded that the insurer
metal drums and placed in the container, which was exam- could not be held liable for Maersk's fault in supplying a
ined by National Insurance before issuing a policy covering defective container and dismissed the complaint.
all risks. The container was loaded on a motor vehicle for
transportation to JNPT, Nhava Sheva Port for shipment. Dujodwala then filed a Revision Petition before the National
Commission. The latter observed that the policy excluded
On October 18, 2006, Maersk informed Dujodwala that the defects in packaging from inception. In Dujodwala's case,
container should not be shipped as it had failed to main- the packaging was done professionally by Maersk, checked
tain the requisite temperature due to technical problem in
by the insurer's representatives and found to be in order.
the refrigeration system. Dujodwala tried to save it from
The defects occurred later due to failure of the refrigera-
damage by getting the container back to its factory at tion system. So the Commission held that the claim would
Raigad. Despite this, the consignment got damaged, so it be payable as the policy covered all risks.
lodged a claim.
Accordingly, by its order of August 31, 2020, delivered by
The insurer appointed a surveyor who assessed at Rs.
Justice R K Agrawal presiding over the Bench along with Dr
12,22,869, after deducting 5 per cent towards salvage S M Kantikar, the National Commission allowed the revision,
value. Despite the favourable survey report, the insurer set aside the order of the State Commission, and restored
repudiated the claim attributing the damage to change in the order of the District Forum, holding the insurer liable
temperature due to improper packing, which was not cov- to pay Rs. 12,94,731 towards the entire value of the dam-
ered under the policy. aged consignment.
Dujodwala filed a complaint before the District Forum. This
was contested by the insurer. A technical defence was Claim payable if bariatric surgery is medi-

raised that the complaint should be dismissed since Maersk cal necessity
was not impleaded in the proceedings, even though it was
Generally, bariatric surgery is performed for cosmetic pur-
a necessary party, as the loss had occurred because of the poses, or to lose weight to prevent an illness that may oc-
defective container.
cur in the future. In such cases, the insurer is not liable to
The Forum overruled the objection, holding that the claim pay a claim for that surgery. However, in a unique twist,

The Insurance Times, September 2020 45