SRINAGAR: In a major relief to flood-affected businessmen, Jammu and Kashmir High Court on Friday directed the insurance companies to pay 50 per cent of insured amount for policies above Rs.25 lakh and 95 per cent for policies below Rs.25 lakh as interim relief.
“We feel that policy in respect of shopkeepers need to be effectively implemented. Under the caption ‘Stock Loss’, it has been contemplated that cases with sum insured is up to Rs.25 lakh, then after making 5 per cent deduction towards dead and obsolete stocks is to be considered as the basis of settlement.
“The insured is to be given an option to accept sum insured less by 5 per cent,” a division bench of the High Court said in an 11-page judgement.
The bench was hearing a petition filed by Kashmir Chamber of Commerce and Industry (KCCI).
Elucidating the order, the bench said, “In other words, 95 per cent of the sum insured has to be disbursed in case of policy involving Rs.25 lakh or less.
“In case of the policies with sum insured up to Rs.25 lakh, the shopkeepers policy should be strictly followed as observed. In respect of the policies with sum insured above Rs.25 lakh, 50 per cent of the assured amount shall be released after receiving undertaking from the insured and also filing of the undertaking by the officer concerned insurance company,” it said.
The court further directed that policy decision of General Insurers Public Sector Association (GIPSA) should be strictly complied with.
“With respect to the policy where sum insured is above Rs.25 lakhs, it has been stated that 50 per cent of the assessed and estimated loss will be released after receipt of preliminary survey report.
“We feel that further categorisation is required to be kept in view while implementing the policy which involves a sum insured beyond Rs.25 lakh. This clause may not be applicable to shopkeepers who have stocks of eatables, food, items, cloths, shoes, readymade garments, hosiery, cosmetics, chemists and the provision stores,” the bench observed.
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