Axis Bank Directed to Pay Rs 2 Lakh in Landmark ATM Insurance Ruling
In a significant consumer rights verdict, the State Consumer Disputes Redressal Commission in Jodhpur has ordered Axis Bank to pay Rs 2 lakh to the nominee of a deceased ATM cardholder. This compensation is under the accidental insurance cover linked to the Visa Platinum ATM card, marking a reversal of an earlier dismissal by the District Commission Jodhpur-I.
Case Background and Initial Rejection
The appeal was filed by Bhupendra Singh, whose brother had opened a savings account with Axis Bank and named him as the nominee. Upon receiving the Visa Platinum ATM card, which included an accidental death insurance cover of Rs 2 lakh, the family believed they were financially protected. Tragically, Singh's brother died after an accidental fall from a rooftop, succumbing to his injuries while being transported to the hospital on January 16, 2018.
Following the incident, Singh submitted an insurance claim in March 2018. However, Axis Bank declined the claim, asserting it was not filed within the mandatory 90-day period. Singh then approached the district commission, which upheld the bank's decision, leading him to escalate the matter to the State Commission for justice.
Commission's Findings and Rationale
Upon thorough review, the State Commission noted that the claim submission was timely, but delays in providing certain documents were due to external factors. The forensic report and police investigation completion, essential for the claim, were only available in December 2018. Once received, Singh promptly submitted these documents to the bank.
The Commission found that Axis Bank failed to forward the claim documents to the insurance company within the required timeframe. This administrative lapse resulted in an unjust rejection based on a delay not attributable to Singh. The ruling emphasized that there was no deficiency in service from the insurance company, placing the responsibility squarely on the bank.
Final Ruling and Compensation Details
The Commission, comprising Judicial Member Surendra Singh and Member Liaqat Ali, ruled in favor of Bhupendra Singh. Axis Bank has been instructed to pay:
- Rs 2 lakh as the insurance amount
- 9% annual interest from May 2019, the date the complaint was filed
- Rs 10,000 towards legal expenses
Additionally, the complaint against the insurance company was dismissed, highlighting the bank's sole liability in this matter. This decision underscores the importance of timely processing by financial institutions and protects consumer rights in insurance-linked banking products.
