J&K flood relief: HC threatens to freeze accounts of lax insurance companies

15 Oct 2014


Annoyed by the laid-back approach of insurance companies in meeting insurance claims of the flood-hit in Jammu and Kashmir, the J&K High Court on Tuesday warned the insurance companies not to ''check its patience'', and directed them to follow its orders on payment of compensation to flood-hit claimants of the state without further delay.

A division bench of the high court headed by Chief Justice M M Kumar said it would freeze the accounts of the companies and appoint two senior lawyers for disbursement of claims if the insurers continue their dilly-dallying.

''Please do not check our patience. If you insist on (survey or assessment reports), then we are going to initiate contempt proceedings against you. Can you tell a single case where you have paid 50 per cent of the amount in accordance with the High Court directions?'' the bench asked when advocate Anil Bhan, representing National Insurance Company, insisted that the companies have already appointed adequate number of surveyors.

''If you don't have any substantial data to prove that you are complying with the spirit of the court directions, we will freeze your accounts and appoint two senior advocates to disburse the amount to the claimants,'' the bench, also comprising Justice Ali Mohammad Magrey, said.

''We know it clearly that the companies want their own way to disburse the amount as per the assessment reports and want to defeat the Supreme Court and High Court orders, but they won't be allowed to do so and shall be dealt with strictly,'' the bench said.

The insurance companies, on the other hand, submitted that they be given enough breathing space to implement the court directions. The bench declined to accept the request.

''More than breathing time has been given to you for filing data before the court. You had time to file special leave petition against the high court order in the Supreme Court but want breathing space to file data before this court,'' it observed hearing a public interest litigation.

The high court had, on 26 September, directed the insurance companies to pay 50 per cent of insured amount for policies above Rs25 lakh and 95 per cent for policies below Rs25 lakh as interim relief to the flood-affected traders.

Later, on 1 October, the court made the orders applicable to cases of total destruction of houses and other properties as also motor vehicles.

Senior lawyer Z A Shah brought the tardy response of insurance companies to the court's notice, maintaining that they were trying to delay implementation of the court orders by insisting on survey or assessment reports.

The court censured the insurance companies for not acting ''vibrantly'' to meet claims of customers and made it clear that if its directions were not implemented, it would ''draw its weapon and use it against the companies.''

''The impression gathered so far is that the insurance companies are not bothered to comply with the court directions. They want to do the things and settle claims on the basis of their own principles,'' the bench said.

''If you don't understand the sober language of the court, we know how to handle the situation. We have enough weapons in our armoury to make you comply with the High Court directions,'' the court said, observing flood ''affected people are crying as they have not been paid the insured amount yet.''

Meanwhile, the state government on Tuesday revealed that the centre too has not been helping in the rehabilitation effort and has not released a single paise so far for the relief and rehabilitation of flood victims of Jammu and Kashmir.

Reports quoting official sources said that all that the state has at its disposal is Rs1,100 crore and the government is spending the amount under SDRF to provide relief to the flood affected people.

The state government is reported to have collected all data pertaining to the losses incurred by different sectors as well as common people due to the flood catastrophe. He said to joint efforts of local youth, police, Army and other agencies, the loss of more human lives were restricted.

The floods claimed 282 lives while 403 persons were injured. It also claimed 90,000 livestock, and affected 1.53 million families in the state.

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