UNITED INDIA INSURANCE CO. LTD v. LEVIS STRAUSS (INDIA) PVT. LTD

What is in issue in this present case has been characterized as “double insurance”, i.e., where an entity seeks to cover risks for the same or similar incidents through two different - overlapping policies. There is a wealth of international jurisprudence on the various nuances of double insurance. Such double insurance is per se not frowned upon in law. The courts however, adopt a careful approach in considering policies which seeks to exclude liability on the part of the insurer. In the present case, the facts are that the only claim preferred by respondent with the insurer on 18.07.2008 was for ` 12.2 crores. There is no material on the record to show that during the subsistence of the policy issued by the parent insurer, it was ever notified by respondent about the existence of the policy issued by AGCS. The final report of the surveyors appointed by the appellant insurer assessed the total loss at ` 11.70 crores. However, it also stated that as respondent’s parent company had obtained another policy under which the loss was to be recovered, the claim was inadmissible because of Condition No. 4 of the SFSP Policy. It is also a matter of record that as against the claim of ` 12.2 crores made upon the insurer in this case, respondent ultimately received equivalent of over ` 19 crores. A contract of insurance is and always continues to be one for indemnity of the defined loss, no more no less. In the case of specific risks, such as those arising from loss due to fire, etc., the insured cannot profit and take advantage by double insurance. [Paras 45, 49, 50][258-D-E; 262-A-D] Peacock Plywood Pvt. Ltd. v. The Oriental Insurance Co. Ltd. [2006] 10 Suppl. SCR 140; United India Insurance Co. Ltd. v Great Eastern Shipping Co. Ltd. [2007] 9 SCR 350; Export Credit Guarantee Corporation of India Ltd. v. Garg Sons International (2014) 1 SCC 686 : [2013] 1 SCR 336; Vikram A B C D E F G H UNITED INDIA INSURANCE CO. LTD. v. LEVIS STRAUSS (INDIA) PVT. LTD. 235