Hisar District Commission Holds SBI General Insurance Co. Ltd. Liable For Dishonouring Fasal Beema Yojna, Delaying Inspection Of Crop Loss

Brief Facts:

Jai Singh (“Complainant”), an agriculturist relying on agriculture as the primary source of income, owned approximately 4 acres of fertile land in Village Kalirawan. He availed a Kisan Credit Card Scheme from the State Bank of India (“SBI”) and, under the "Fasal Bima Yojana" scheme, a premium was deducted from his account by SBI for Kharif Crop for an insurance policy of SBI General Insurance Company Ltd. (“Insurance Company”). Despite this, the Complainant did not receive any formal policy or cover note for the crop insurance.

The Complainant sowed Paddy, Bajra, Maize, and Cotton Crops, expecting a good yield. Unfortunately, due to hailstorms and water accumulation on specific dates, the entire crop was damaged. The Complainant reported the loss to the insurance company, agriculture authorities, and SBI, following which SBI assured reimbursement to the Complainant after a field visit. Several farmers in the Complainant's village received crop claims, but the Complainant did not. The Complainant made several communications with the insurance company, SBI and Deputy Director of Agriculture, Hisar but didn't receive a satisfactory response from them. Feeling aggrieved, the Complainant approached the District Consumer Disputes Redressal Commission, Hisar (“District Commission”) and filed a consumer complaint against them. The Complainant argued that his insured crop suffered damage due to hailstorms and water accumulation on specific dates, resulting in a loss of Rs. 4,00,000/-.

The insurance company, in response, contended that a policy was issued for cotton crops, and the insurance company assessed and paid Rs. 19,438/- as a localized loss, arguing that there was no liability on its part.

SBI, denied any role in the claim payment process, emphasizing its role as a service provider. It argued that the Complainant's insurance was under PMFBY, and the premium was deducted and remitted to the insurance company. Deputy Director of Agriculture, in their response, claimed that it surveyed the Complainant's field, assessed the loss report, and refuted the Complainant's allegations.

Observations by the District Commission:

The District Commission noted that the Deputy Director of Agriculture surveyed the Complainant's crop and reported that the insured cotton crop of 1.2145 hectares suffered damage up to 50% due to hailstorms and water accumulation. It held that the Complainant duly informed the authorities and the insurance company about the crop damage within the prescribed period, fulfilling his obligations as per the guidelines mentioned in Column No. 15 of the operational guidelines.

It held that the insurance company failed to fulfil its duties under the operational guidelines. Despite the Complainant's timely intimation of loss, it held that the insurance company did not inspect the Complainant's field within the prescribed period. Furthermore, it held that the insurance company did not adequately explain the localization of claim intimation in their written statement and evidence. The insurance company assessed the loss based on the report and paid a claim amount of Rs. 19,438.80/-. However, the District Commission held that the Complainant demonstrated through cogent evidence that his insured crop suffered a 50% loss. As per the assessment, it held that the Complainant was entitled to Rs. 43,722/-, which was 50% of the total insured sum of Rs. 87,444/- for the 1.2145-hectare land.

The District Commission held the insurance company liable for deficiency in services and held that it was liable to pay Rs. 43,722/-, representing 50% of the insured sum, to the Complainant for the loss of the insured crop under the PMFBY scheme. Since the insurance company had already paid Rs. 19,438.80/-, it was directed to pay the remaining amount of Rs. 24,283.2/- to the Complainant. It was also directed the insurance company pay a compensation of Rs. 8,000/- for mental agony and harassment, along with Rs. 5,000/- for the litigation costs incurred by the Complainant.