Case Note & Summary
The petitioner, Vivid Karyakari Seva Sahakari Society Limited, a cooperative society, filed a writ petition challenging the rejection of its crop insurance claim under the National Agricultural Insurance Scheme for the year 2002-2003. The society had obtained a loan from the Latur District Central Cooperative Bank for its members and the bank was to deduct the insurance premium from the loan amount and remit it to the insurance company. However, the premium was not paid by the due date of 31st August 2002. The insurance company, General Insurance Corporation of India, rejected the claim on the ground that no premium was received and no risk was covered. The society argued that the bank was responsible for remitting the premium and that the insurance company should have accepted the premium later. The court held that payment of premium is a condition precedent for the insurance contract to come into existence. Since the premium was not paid within the stipulated time and the insurance company did not accept the risk, no contract of insurance was formed. The court dismissed the petition, finding no merit in the society's claim.
Headnote
A) Insurance Law - Crop Insurance - Condition Precedent - National Agricultural Insurance Scheme - Payment of premium is a condition precedent for coverage - The petitioner society failed to pay premium within the stipulated time and the insurance company did not accept the risk - Held that no contract of insurance came into existence and the claim was rightly rejected (Paras 5-8).
Issue of Consideration
Whether the petitioner is entitled to crop insurance claim when the premium was not paid by the due date and the insurance company had not accepted the risk.
Final Decision
Writ petition dismissed. No order as to costs.
Law Points
- Insurance claim
- crop insurance
- premium payment
- cooperative society
- National Agricultural Insurance Scheme
- condition precedent
- writ jurisdiction
