BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 14^TH DAY OF NOVEMBER 2024

ORDER

SMT.M.SHOBHA, PRESIDENT

1. The complaint has been filed under Section 35 of C.P.Act (hereinafter referred as an Act) against the OP for the following reliefs against the OP:-

1. Direct the OPs to refund excess premium amount paid by the complainant of INR 11,04,099/- with interest at 18%  from the date of payment of premium till the actual date of realization towards the monetary loss suffered by the complainant.
2. Direct the OPs to compensate the complainant for the mental agony and torture for deficiency of service, unfair trade practices and unfair contract to the extent of INR 10,00,000/- as damages.
3. Direct the OPs to pay litigation expenses of INR 2,00,000/- to the complainant.
4. Pass any other order that this Hon’ble Commission deems fit.

2. The case set up by the complainant in brief is as under:-

The complainant is a private company registered under the provisions of companies act 2013 and it is well known company in the field of interior designing having executed projects worth crores across the country with some of the most reputed clients for over two decades having began its operations in the year 2000.  

3. It is the case of the complainant that the OP1 is a company incorporated under the companies act engaged in the business of general insurance and licensed by IRDA of India.
4. The complainant during the course of its business operations required insurance services for its projects and the personally working in the same in the year 2022 the complainant has commenced operations for its project for its client namely Micron Technology Operations India LLP. The said project was worth Rs.98,62,69,713/- and required insurance under contractors all risk insurance and workmen’s compensation insurance respectively. The duration of the project was six months and a total of 250 laborers were involved in the same.  
5. During this time the OP2 who represented as an authorized insurance agent of OP1, approached the complainant and presented quotes for the said project from various insurance companies.  He had deliberately compelled the complainant to purchase the insurance policy provided by OP1.  On account of strong insistence by the OP1 the complainant was compelled to accept the same and proceeded to issue a purchase order on 07.02.2022.  Thereafter on 08.02.2022 and 09.02.2022 upon acceptance of the quote and the purchase order, the complainant secured two insurance policies from OP1 through OP2 i.e., workmen compensation insurance bearing policy No.OG-00-1701-2802-00000470, which is referred as WC insurance and contractors all risks insurance bearing policy No.OG-22-1701-040200000085 referred as car insurance respectively.
6. The complainant has paid consideration amount as per sec 34 of the C.P.Act.  the premium paid in respect of WC insurance as sought for by the OP1 was Rs.81,902/- and for car insurance the premium was Rs.12,49,142/- inclusive of GST.  The said amounts were accordingly paid by the complainant to the OP1.
7. The specific grievance of the complainant is that after purchase of the policy during its mutual discussion with other insurance companies and agents the complainant was shocked to note the premium as quoted by the OPs stood almost 600% higher than the rate quoted by the OPs.  Further in order to substantiate the unlawful act of the OPs in charging exorbitant premium amounts, the complainant sought for clarification from the OPs, but they have not provided any clarification.  Thereafter the complainants have secured a revised quotation for the next term of the project(6 months) from the OP1 directly.   The complainant to their surprise on 18.02.2023 received a revised quotation of premium from OP1 i.e., Rs.2,07,331/- towards car insurance with GST and Rs.19,614/- towards WC insurance with GST totally amounting to Rs.2,26,945/- indicating a substantial reduction in the premium amount.
8. It is further grievance of the complainant that despite the project value remaining the same, the total number of laborers remaining the same and for the same project and involved risks, when compared to the earlier premium amount, there was an insurmountable difference between the premium charged in 2022 and the premium quoted in 2023 i.e., Rs.10,41,811/- towards car insurance with GST and Rs.62,288/- towards WC insurance with GST in total amounting to Rs.11,04,099/-.  This substantial reduction of amount mandated the complainant to further probe into the unlawful actions of OP1 company and seek for insurance quotes from other insurance companies.  Thereafter the complainant approached Apna Insurance Broking Consultants India Pvt. Ltd., to enquire about the premium charged by TATA AIG for the same project value was Rs.2,03,665/- towards CAR with GST and Rs.5,896/- towards WC with GST in total amounting to Rs.2,09,561/-.
9. A comparative table illustrating the aforementioned differences in premium amounts discloses that the premiums being charged by the OP1 and other insurance companies and the OP 1 and 2 discloses regarding the exorbitant premium amount charged by them. There was no positive response provided either of them and only vague assurances were made regarding adjusting the excess premium paid towards future payments due.  This lack of transparency and inconsistent approach is a direct result of unfair trade practice adopted by OP1 in its course of business. The action on the part of OP1 in quoting premium amounts which vary at a margin of 600% reflects their intention to unjustly enrich themselves at the cost of the complainant’s company.  This clearly shows unfair trade practices followed by OP and their intention to cheat the complainant by over charging the premium amount.  The OP1 colluded with OP2 have caused severe financial losses to the complainant company.  The OPs also failed to return the excess premium charged by them. Hence the complainant has filed this complaint.
10. In response to the notice, OP appears and files version admitted that this OP1 is an insurance company and OP2 is the agent.  The complainant approached this OP for quotation for car insurance and WC insurance in order to cover the project.  It has commenced with the client of the complainant. They have also admitted about the quotation given for car policy ad also WC insurance policy and further admitted about the policy issued by them for a period from 08.02.2022 till 07.05.2022 after collecting the premium.
11. It is further case of the OP that after lapse of the said period complainant sought for extension for two months for CAR insurance and this OP has provided the quotation amounting to Rs.2,11,908/- for the extension period from 07.08.2022 to 06.08.2022.  Subsequently again the complainant sought for extension of additional period of one month for the car insurance and this OPs have made the quotation for the additional period of one month from 07.10.2022 to 06.11.2022 was Rs.1,19,338/-.  Both the quotations were accepted by the complainant and an endorsement was made in the car insurance to give effect to the extension.
12. It is the specific contention taken by the OPs that the quotation given on the basis of the guidelines from the general insurance counsel and also as per the under writing guidelines of the IRDAI.  The quotation of the renewal premium is calculated as per the analysis of risk, claim ratio from the previous policy etc., the risk factor in comparison to the previous policy terms for the project was low compared to the previous term and further the quotation submitted by the insurer for the extended period is almost similar.  Further the quotation obtained from other insurance is also subject to strict proof without which the complaint is not maintainable.
13. It is further contention of the OP that all the products of the insurance its benefit under the policy and the insurance premium is subject to approval from the IRDAI. Hence the insurance policy which was offered to the complainant is an IRDAI approved policy and the allegation of the complainant regarding the exorbitant premium is baseless and denied as false.

14. This OP has fixed the insurance premium on the guidelines of the IRDAI and also as per the prevailing market rates. This OP has not committed any deficiency in service and it is the complainant who despite receiving the premium from this OP has filed this complaint.  Hence the complaint is premature against this OP wherein it has neither received any grievance from the complainant nor has committed any deficiency in service. Hence the complaint is not maintainable against this OP. the complainant has failed to make out a deficiency of service and unfair trade practice. Hence OP prayed for dismissal of the complaint.
15. The complainant has filed his affidavit evidence and relies on 09 documents.  Affidavit evidence of OP has been filed and OP relies on 08 documents.
16. Heard the arguments of advocate for both parties.  Perused the written arguments filed by both parties.
17. The following points arise for our consideration as are:-

1. Whether the complainant proves deficiency of service on the part of OP?
2. Whether the complainant is entitled to relief mentioned in the complaint?
3. What order?

18. Our answers to the above points are as under:

Point No.1:  In the negative

Point No.2: In the negative

Point No.3: As per final orders

REASONS

19. Point No.1 AND 2: These two points are inter related and hence they have taken for common discussion.  We have perused the allegations made in the complaint, version, affidavit evidence of both the parties, written arguments and documents.
20. It is undisputed fact that both the parties are the companies. The complainant has taken car insurance and also WC insurance from the OP1 through OP2.  Accordingly the OP have issued car insurance policy as per Ex.R1 for the period of six months and the validity was from 08.02.2022 to 06.08.2022 and WC policy for the period from 08.02.2022 to 07.08.2022.  after lapse of the policy period the complainant has sought for extension of policy for another two months and the OPs have provided the quotation amounting to Rs.2,11,908/- for the car policy and again the complainant sought extension and the quotation was made for Rs.1,19,338/-.  The said quotation towards car policy was given as an extension of the policy period.
21. The main contention taken by the complainant is that during mutual discussion with other insurance companies and agent it was discovered that the premium rate quoted by the OPs were excessively high. Specifically the premiums offered by the OPs were nearly 600% higher than those offered by other comparable entities in the market. Despite the staggering difference in premium rates the OPs failed to provide any satisfactory justification for the exorbitant amount charged.  When the complainant sought clarification on the matter the OP remains non responsive thereby neglecting their duty to provide transparent and accountable information to the complainant.  The drastic difference between the original and revised quotation suggest a lack of transparency or justification for the initial higher premium amount. Such discrepancies not only undermine consumer trust but also question the reliability and consistency of the OP1 companies pricing practices.
22. The premium quotation provided by OP company for the same project in the year 2023 shown a significant reduction in the total premium amount prompting the complainant to question the rationale behind the insurance higher premium charges and it made the complainant to conduct further enquiries into the potentially unlawful actions of the OP1 company.  According to the information obtained from the Apna Insurance Broking Consultant India Pvt. LTd., Tata AIG quoted a significantly lower premium amount for the complainant’s project and they have offered a premium of Rs.2,03,665/- for car insurance with GST and Rs.5,896/- for WC insurance with GST i.e., the totally Rs.2,09,561/-.  This substantial difference between the premium quoted by Tata AIG and the initial quotation from OP1 company further underscores the complainant’s concerns regarding the fairness and reasonableness for the premium charges imposed by the OP1 company. 
23. On the other hand, the specific contention taken by the OP is that the premium quoted by the OP is acknowledged, agreed upon and accepted by the complainant and based on which the policy was issued resulting in a lawful contract. There is no unlawful trade practice, deficiency in service on their part.
24. It is further case of the OP that regarding the issuance of car policy in question as per the standard policy issuing procedure this OP company car policies are typically issued once for the duration of the whole contract with only provision to provide extensions until the completion of insured project/contract.  For one contract there is only one policy which can be issued and thereafter only extensions can be made and no new policy will be issued for the same contract.  This OP has not issued any new quotation for a new policy and it is an extension of the existing policy was sought by the complainant and accordingly issued to the complainant.  The quotation of the extension of premium is calculated as per the analysis of risk claim ratio from the previous policy etc., since the project was almost completing its end and hence the risk factor and claim ratio in comparison to the previous policy term for the project where is in comparison to risk and claim ratio.  
25. The complainant has also not furnished the quotation obtained from other insurers for the previous initial term in order to prove his allegations.  This OP company while finalizing and issuing insurance policy request the complainant to reconfirm contract under the policy by giving 15 days time to raise objections with respect to the information mentioned in the policy pertaining to the complainant. The complainant has not raised any objection or disagreement within 15 days. Therefore the policy was finalized. Now the complainant has raised objection pertaining to the said discrepancies only with an intention to shift the blame from his shoulders to the shoulders of the OP company which is unjust as per the principles and procedures of law.  The complainant has approached this commission after availing and enjoying the entire term of services/risk undertaken by this OP in lieu of the policy.  The act of the complainant seeking for refund of the premium after enjoying the services as to risk indemnified during the policy is unjust, unfair and unreasonable. This OP has neither caused any unlawful contract nor committed any deficiency in service.
26. The only dispute between the parties is that the OP has collected the exorbitant premium from this complainant company compared to other insurance companies.  It is further contention of the complainant that the premium amount collected by the OP company is nearly 600% higher than those offered by others insurance company in the market.  Admittedly the complainant has approached this commission after availing and enjoying the entire term of services and risks undertaken by this OP in lieu of the policy.  Now the complainant is seeking for refund of the premium after enjoying the services as to the risk indemnified during the policy.
27. Admittedly the complainants are also the company and they have got fully established marketing team in their company. They would have done the market survey before taking the policy from the OP company.  Even though there is a 15 days specific time fixed for raising any objections after received the policy the complainant has not at all raised any objections and accepted the policy.  Now the complainant has approached this commission seeking refund of the premium amount only on the ground that the premium amount offered and collected by the OPs are nearly 600% higher than those offered by other insurance companies. When the complainants have not raised any objection at the earlier stage i.e., within 15 days after received the policy now the complainant cannot raise this objections and seeking for the relief to refund the premium amount from the OP.  Even though the complainant has taken the contention that the OPs have collected merely 600% higher than the premium offered by other insurance entities in the market have not produced any document in support of their contention. All the products of the insurance, its benefits under the policy and the insurance premium is subject to the approval from IRDAI.  The policy offered to the complainant is an IRDAI approved policy.  The insurance premium is generally fixed as per the guidelines issued by the IRDAI and also as per the prevailing market rates.  The quotation was given by the OP on the basis of the guidelines from the general insurance counsel and as per the guidelines of the IRDAI.
28. Under these circumstances, the complainant has failed to prove the allegations made against the OP relating to deficiency of service and unfair trade practice and the exorbitant amount of premium collected by the OPs. Hence the complainant is not entitled for any relief. Therefore we answer point No.1 and point No.2 in the Negative.
29. Point No.3:- In view the discussion referred above we proceed to pass the following;

O R D E R

1. The complaint is Dismissed. No costs.
2. Furnish the copy of this order and return the extra pleadings and documents to the parties.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 14^TH day of NOVEMBER 2024)

Documents produced by the Complainant-P.W.1 are as follows:

Documents produced by the representative of opposite party – R.W.1;