In the context of a case involving Reliance Life Insurance, it was observed by Mr. Chandra from the National Consumer Disputes Redressal Commission (NCDRC) that the nominee of the policyholder, Mr. Verma had been recognized as eligible for all the benefits provided by the insurance policy. However, there was a dispute regarding the non-disclosure of a previous injury in the proposal form.
The NCDRC noted that there was no cear indication in the medical discharge certificate from the hospital that Mr. Verma had been advised against riding a two wheeler due to a prior head injury. While Mr. Verma had been granted a 10 day leave from work for rest purposes that t there was a lack of concrete evidence suggesting that he had disregarded medical advice and continued to ride a two wheeler. As a result, there was insufficient evidence to attribute the cause of the road accident to Mr. Verma’s actions.
The bench at NCDRC expressed its dissatisfaction with the insurance company’s decision to repudiate the claim made by Mr. Verma’s nominee. They emphasized that the reasons provided in the repudiation letter dated May 7, 2016 did not appear to be based on a careful and fair assessment of the facts and circumstances surrounding the case.
Consequently the NCDRC issued a directive ordering the insurance company to pay a sum of Rs1 crore, which was the amount of insurance coverage for which Mr. Verma was eligible. Additionally, the insurance company was instructed to pay 9% interest on this amount and bear Rs50,000 as litigation costs.
In summary, the NCDRC found that the repudiation of the claim was unjust in this case and they ordered the insurance company to fulfill its obligations under the policy by providing the specified benefits to Mr. Verma’s nominee along with the specified financial compensation.