The Gujarat State Consumer Disputes Redressal Commission has ruled in favor of a Vadodara resident, ordering a bank and an insurance company to jointly pay the insured amount. The commission observed that information not disclosed to a policyholder cannot be used to reject a legitimate claim.
Case Background
Bharti Prajapati's husband held a savings account with Union Bank, from which Rs 100 was deducted for a personal accident insurance policy. In January 2018, he died in a fire caused by a short circuit at their home. Prajapati discovered the policy only three months later while checking the bank passbook. She approached the bank and submitted an insurance claim in April 2018. However, the bank mistakenly sent the claim intimation form to the wrong insurance company, further delaying the process until June 2018. The Oriental Insurance Company Ltd rejected the claim in September 2018, citing the delay in submission.
Consumer Forum's Findings
Advocate Akhil Dave, representing Prajapati, argued that neither the bank nor the insurance firm provided the policy schedule to Prajapati or her husband. He stated that as a homemaker, she could not be expected to be aware of the policy, especially given the minimal premium of Rs 100. The Vadodara consumer forum in 2022 directed the bank to pay Rs 5 lakh with interest. The bank challenged this order before the state commission in 2023.
State Commission's Verdict
The state commission noted that the insurance firm had sought an explanation from the bank in June 2018 regarding the delay and had also requested additional documents. The commission stated, "The email demonstrates that the opponent insurers were actively considering the claim and had not treated it as barred or non-maintainable." It observed that the complainant was never given a copy of the policy, constituting a deficiency in service by the bank. The bank also forwarded the claim to the wrong insurer, contributing to the delay. The commission held that the insurance firm repudiated the claim on purely technical grounds.
The state consumer commission, comprising presiding member A R Raval and member P R Shah, ordered Union Bank and Oriental Insurance to jointly pay Rs 5 lakh to Prajapati with 8% interest from the date of filing the complaint.
