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The negative attitude of the Insurance Companies in repudiating the claims, defeats the very purpose of the Law Makers drafting the Insurance Act: Karnataka State Consumer Disputes Redressal Commission

The Commission opined that, when Insurance Company collects premiums, it should also take responsibility to properly address the complaints of its poor clients, who pay the premiums with extreme difficulty in the hope that the Sum Assured in the Insurance Policy will rescue them in case of crisis. This was held in the matter of M/s United India Insurance Co. Ltd v. Mr. B S Sathish [ Appeal No. 955/2018] before Hon’ble President Mr. Justice Huluvadi G Ramesh.

The brief facts of the case are as follows; the Complainant insured his Cow under the Micro Insurance Product Cattle Insurance Policy from the Opposite Party (OP).  Rs. 50,000 was insured till 10th August 2017. The Cow died on 29th May 2017. When he claimed the insurance, OP rejected his claim on the ground that the Ear Tag No. of the policy was not submitted by him, while not challenging the PM Report or the Death Certificate dated 1st June 2017.  The Death Certificate indicated that as on date of death , the Insurance Policy was still in effect. The District Commission allowed the Complaint for deficiency of service against the OP. Aggrieved by this decision, the OP sought an appeal before the State Commission claiming that the 8th Term& Condition explicitly mentions the ‘No Tag No Claim’.

After perusing the submissions of both the parties, the State Commission held that, the Policy was in force and OP is liable to honor the Claim of the Complainant. Also, when the Insurance Companies happily collects the premiums, it should also take moral responsibility to resolve the grievances of its poor clients, who, with great difficulty pay the premiums, with a fond hope that when there is an absolute crisis, the Sum Assured in the Insurance Policy will come to their rescue. The negative attitude of the Insurance Companies in repudiating the claims, defeats the very purpose of the Law Makers drafting the Insurance Act and its further fine tuning from time to time, to reduce the grievance of the Insured. However, with regard to rate of interest awarded at 9% p.a by the District Forum is concerned, we are of the considered opinion that it is on higher side, hence, it is felt appropriate to reduce it to 6% p.a which would meet the ends of the justice and accordingly, Impugned Order is modified in the following terms.”

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Judgement Reviewed by Vagisha Sagar

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