[Insurance Act] Surveyors Work Impartially & Independently, Cannot Be Branded 'Puppets' Of Insurance Company: Delhi HC

Justice Manoj Jain observed, “They work impartially and independently and, such surveyors and loss-assessors, are mandated to comply with code of conduct in respect of their duties, responsibilities and other professional requirements, as specified in the regulations made under Insurance Act, 1938.”

The observation was made after the District consumer forum dispensed a surveyor's report in an insurance claim, stating that 'Insurance Company was the paymaster of the Surveyor and such Surveyor could not have displeased his such master.'

The claim arose out of a fire that broke out at the policyholder's building, fuming its garment stock.

Though, according to the policy holder ,the loss was of 5,138 garments, the Surveyor, on the basis of the enquiry made from the concerned production in-charge and, presuming some tinkering with the record, formed a view that the loss was only of 1500 pieces, which were lying in the fire-affected area.

Thus, the insurer had assessed the loss as Rs. 4,73,097/- as against Rs.16,40,991/- claimed by the policy holder.

The District consumer forum ruled in policy holder's favour and after preferring statutory remedies, the insurer approached the High Court.

The High Court noted that the Insurance Company did not submit Surveyor's affidavit nor did it examine the surveyor in its defence at the evidence-stage. Thus, it refused to interfere with the matter.

However, it was of the view that the District Forum was not justified in commenting that Surveyor, being on pay-roll of Insurance Company, had given his report in their favour.

“Surveyors cannot be branded as puppets…surveyor cannot be castigated in such a general and vague manner,” the Court said.

In the same breath, it added that Surveyor's report cannot also be said to be the sole deciding factor in an insurance claim.

It relied on National Insurance Company Ltd. Vs. Hareshwar Enterprises (2021) where the Supreme Court had held that though the assessment of loss by any approved surveyor is a prerequisite, the report of surveyor is not a final word and it is for the adjudicating authority to assess whether the evidence is credible.

Eventually, the Court dismissed the petition.

Appearance: For the Petitioner: Mr. J P N Shahi, Advocate. For the Respondent: Mr. Manoj Singh, Advocate.

Case title: New India Assurance Co. Ltd. v. M/S Interweave Fashions (P) Ltd

Case no.: CM(M) 2509/2024

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