In the judgment of Sri Venkateswara Syndicate vs. Oriental Insurance Company Limited (2009) 8 SCC 507, Supreme Court of India has upheld the right of the Insurance Company to appoint Surveyor but such right can be exercised for valid reasons or if the report is found to be arbitrary and that Insurance Company must give cogent reasons without which it is not free to appoint the second Surveyor. The relevant extracts of the judgment read as under:
“33. Scheme of Section 64-UM, particularly of subsections (2), (3) and (4) would show that the insurer cannot appoint a second surveyor just as a matter of course. If for any valid reason the report of the surveyor is not acceptable to the insurer may be for the reason if there are inherent defects, if it is found to be arbitrary, excessive, exaggerated, etc., it must specify cogent reasons, without which it is not free to appoint the second surveyor or surveyors till it gets a report which would satisfy its interest. Alternatively, it can be stated that there must be sufficient ground to disagree with the findings of surveyor/surveyors. There is no prohibition in the Insurance Act for appointment of second surveyor by the insurance company, but while doing so, the insurance company has to give satisfactory reasons for not accepting the report of the first surveyor and the need to appoint second surveyor. xxx xxx xxx
35. In our considered view, the Insurance Act only mandates that while settling a claim, assistance of a surveyor should be taken but it does not go further and say that the insurer would be bound by whatever the surveyor has assessed or quantified; if for any reason, the insurer is of the view that certain material facts ought to have been taken into consideration while framing a report by the surveyor and if it is not done, it can certainly depute another surveyor for the purpose of conducting a fresh survey to estimate the loss suffered by the insured. xxx xxx xxx
37. The option to accept or not to accept the report is with the insurer. However, if the rejection of the report is arbitrary and based on no acceptable reasons, the courts or other forums can definitely step in and correct the error committed by the insurer while repudiating the claim of the insured. We hasten to add, if the reports are prepared in good faith, with due application of mind and in the absence of any error or ill motive, the insurance company is not expected to reject the report of the surveyors”.
In a recent case was evidently found by the Hon’ble Supreme Court of India that the claim of Rs. 54,93,865/- was accepted by the surveyor- A. The second surveyor- B accepted the claim in the sum of Rs. 24,76,585/-. The third surveyor – C recommended total repudiation of claim. It is the third Surveyor’s report which sub-served the interest of the Insurance Company which was made basis of repudiation of the claim of the Complainant on the same day, when the report was furnished. The SCI found that in view of the judgment in Sri Venkateswara (supra), it is not open to appoint another Surveyor till such time, it gets a report in its favour. In fact, the appointment of the Surveyors was to repudiate the claim of the Complainant on one pretext or the other.
Insurance Advocate lawyer in Noida and Insurance Advocate lawyer in Delhi NCR must be contacted by insured for rightly filing a claim.
One can read the latest supreme court judgment on the issue by accessing following link:
https://www.sci.gov.in/supremecourt/2014/29419/29419_2014_Judgement_01-May-2019.pdf