The commission said alleged unauthorised construction, an electricity connection and missing firefighting equipment could not justify rejecting cover for a fire caused by an accidental short circuit.
The Maharashtra State Consumer Disputes Redressal Commission has ordered United India General Insurance to pay ₹87.33 lakh to the owner of a Solapur textile factory after rejecting a fire-damage claim on grounds the tribunal found unconvincing. The commission said the insurer could not deny coverage merely because the premises allegedly had unauthorised construction, an unauthorised electricity connection and no firefighting equipment, where the loss itself arose from an accidental electrical short circuit.
According to the order, M/s Mateshri Textile had insured its factory building, machinery, stock and raw materials for a total of ₹91.5 lakh under three policies. The factory was hit by a fire that the complainant said caused losses of ₹87,33,324, supported by police records, fire brigade papers and the surveyor notification. United India repudiated the claim in July 2018, arguing that the insured had breached policy conditions and had not adequately proved the extent of stock loss.
The commission rejected that defence, saying minor safety or regulatory shortcomings could not automatically defeat a claim under a standard fire policy unless the insurer had clearly made those requirements conditions precedent to cover. It also said an insurer that inspects a site, issues a policy and collects premium cannot later rely on pre-existing structural issues to avoid payment unless it shows the problems materially changed the risk or were concealed and linked to the loss.
The ruling adds to a series of consumer-court decisions in Maharashtra scrutinising insurers’ efforts to repudiate fire claims on technical grounds. In a separate case reported this year, the same state commission told United India Insurance to pay ₹70 lakh over a luxury car destroyed by fire after a late-night tyre puncture, again criticising what it described as an overly technical approach to claim rejection. In the Solapur textile dispute, the commission also awarded 9% interest from the date of repudiation in 2019, along with ₹1 lakh for mental agony and ₹50,000 towards litigation costs.
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