Page 55 - The Insurance Times August 2024

The insurance company said that the policyholder who passed owing to fraudulent behavior, did not apply to the
away had concealed a past brain injury from a car accident concealment of a prior hospitalization resulting from a car
that occurred a year before the policy was obtained. The accident. As a result, the insurance company was ordered
insurance provider also contended that failure to provide this to pay the complainant Rs. 1,00,00,000, which is equal to
important information constituted a breach of the 1938 ten times the annualized premium or 105% of the premium
Insurance Act and the terms of the insurance contract. Section paid as of the date of death, plus interest at the rate of 9%
45 of the Insurance Act, which permits repudiation of a policy per year starting on the date the claim was submitted.
within three years of the date of issuance in circumstances of
fraud or non-disclosure, was used by the insurance company Gurdaspur District Commission Holds
as justification for its rejection of the claim. Moreover, the
insurance contended that the complainant could not qualify as Punjab Gramin Bank And Bajaj Allianz
a "consumer" under the customer Protection Act since they Life Insurance Liable For Deficiency In
were not beneficiaries under the insurance policy. Additionally,
the insurance company produced documentation of the Service For Misappropriation Of Cheque.

deceased's hospitalization for a brain injury sustained in an
earlier accident, arguing that this history had not been revealed Surjit Singh vs Punjab Gramin Bank and Anr.
when the policy was obtained. The insurance provider stressed Summary
that the repudiation of the claim was in compliance with the The District Consumer Disputes Redressal Commission in
regulations and the conditions of the insurance policy. It claimed Gurdaspur, Punjab, found Punjab Gramin Bank and Bajaj
that because the policy only covered Rs. 1 crore instead of Rs. Allianz Life Insurance Company accountable for unfair trading
2 crore in the event of an accidental death, the complaint had practices and service deficiencies. The insurance company
exaggerated the claim amount. neglected to process a cheque for Rs. 46,645, which was

The insurance company claimed that the complainant was supposed to be given to the complainant after the insurance
not a "consumer" as defined by the customer Protection policy matured. The complainant, Surjit Singh, obtained a life
Act; however, the NCDRC refuted this claim. According to insurance policy from the bank and was advised to contact
the terms of the agreement between the insured and the the insurance company after the policy matured. The
insurer, the NCDRC determined that the nominee under an insurance company refuted the complainant's accusations,
insurance policy is the legitimate recipient of the benefits arguing that the complainant had already received a cheque
under the policy. The NCDRC supported the idea that for the matured amount. The District Commission found that
beneficiaries of policies taken out by the insured are also the bank and insurance company had not paid the amount,
'consumers' under the Act, even though they are not parties leading to the plaintiff's compensation for mental suffering,
to the insurance contract, by citing the Canara Bank Vs. M/ harassment, legal expenses, and interest.
s. United India Insurance Co. Ltd. & Ors. CA No.1042 of 2020 About the case
in SLP (Civil) No.20393 of 2018 case. The NCDRC noted that
hospitalization for a car accident-which was not disclosed Punjab Gramin Bank and Bajaj Allianz Life Insurance
Company were found accountable by the District Consumer
in the application form-should not be interpreted as a way
Disputes Redressal Commission, Gurdaspur (Punjab) bench,
to hide a prior sickness or condition. The NCDRC stressed
that the purpose of the complainant's son's medical which was made up of members Bhagwan Singh Matharu
examination was to find out about any pre-existing and President Lalit Mohan Dogra, for unfair trading
conditions, and that failing to disclose a prior auto accident practices and service deficiencies. As per the agreement,
the Bank and the Insurance Company neglected to process
did not constitute fraudulent concealment. The NCDRC
observed that the insurance claim pertaining to the same the cheque for Rs. 46,645 that was supposed to be given to
the Complainant after the insurance policy matured.
incident had been authorized by Life Insurance Corporation
of India (LIC), another insurance firm, without any Through Punjab Gramin Bank ("Bank"), Surjit Singh
objections. This information suggested that the claim could ("Complainant") obtained a life insurance policy from Bajaj
not be rejected on the grounds that the prior accident had Allianz Life Insurance Company ("Insurance Company") via
not been disclosed. The insurance company's argument for the bank. The complainant said that the bank had
repudiating the claim based on section 45 of the Insurance recommended that he purchase an insurance policy for Rs.
Act of 1938 was denied by the NCDRC. The NCDRC ruled 10,000 annually. He paid the premium in accordance with
that Section 45, which deals with the repudiation of claims the provisions of the policy, and he went to the bank to

50 August 2024 The Insurance Times