Insurance claim assessment: small claims may be settled internally without a mandatory approved surveyor report under the statutory threshold.

Section 64UM of the Insurance Act is read to require an approved surveyor or loss assessor only for claims at or above the specified threshold, while smaller claims may be handled through alternative in-house assessment where using an approved surveyor would be disproportionate. The provision also preserves the Controller's power to require a report where necessary, so surveyor involvement is not mandatory in every low-value claim. The commentary further notes that this mechanism was viewed as a rational cost-and-time saving arrangement and not as an arbitrary restriction on trade or a violation of equality or other fundamental rights.

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Issues: (i) Whether, under Section 64UM of the Insurance Act, 1938, a claim of less than Rs. 20,000 could be settled by the insurer without obtaining a report from an approved surveyor or loss assessor; (ii) Whether such in-house settlement of smaller claims violated Articles 14, 19(1)(g) and 21 of the Constitution of India.

Issue (i): Whether, under Section 64UM of the Insurance Act, 1938, a claim of less than Rs. 20,000 could be settled by the insurer without obtaining a report from an approved surveyor or loss assessor.

Analysis: The statutory scheme distinguishes between claims of Rs. 20,000 and above and claims below that limit. Sub-section (2) makes a survey report mandatory for claims at or above the threshold, while sub-section (6) permits the insurer, in the case of smaller claims, to use another person where engaging an approved surveyor would be disproportionate. Sub-section (9) shows that the Controller may still require a report if necessary, which indicates that the insurer is otherwise not bound in every small claim to obtain a surveyor's report. The provision therefore does not compel every claim below the threshold to be surveyed by an approved surveyor or loss assessor.

Conclusion: The insurer may settle claims below Rs. 20,000 without mandatorily obtaining a report from an approved surveyor or loss assessor.

Issue (ii): Whether such in-house settlement of smaller claims violated Articles 14, 19(1)(g) and 21 of the Constitution of India.

Analysis: The challenge failed because small-claim settlement by the insurer is a rational method that reduces cost and delay, and approved surveyors or loss assessors are not excluded from their profession in respect of claims that require their services. The arrangement is not arbitrary and does not amount to an unconstitutional restriction on the petitioner's trade or business. No infringement of the pleaded fundamental rights was established.

Conclusion: The constitutional challenge was rejected.

Final Conclusion: The statutory provision was construed to permit in-house settlement of claims below the prescribed limit, and the writ petition failed on both statutory and constitutional grounds.

Ratio Decidendi: Where the statute expressly requires a survey report only for claims at or above a specified threshold and separately permits alternative handling of smaller claims, the insurer retains discretion to settle smaller claims internally unless the Controller directs otherwise.

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