The Maharashtra State Consumer Disputes Redressal Commission recently directed Reliance Nippon Life Insurance Ltd to pay ₹60 lakh along with 12% interest and an additional ₹2 lakh as compensation for mental and physical harassment to the policyholder’s widow.
On August 27, 2016, 40-year-old Rajesh Tiwari died at MIT Hospital, Aurangabad due to cirrhosis of the liver and portal hypertension. His widow Vijeta claimed that she had taken a life insurance policy in April 2015 for a term of 35 years and paid an annual premium of ₹9,890 with a sum assured of ₹60 lakh. After his death, Ms Tiwari informed the company and issued a letter along with the claim form as she was his nominee. However, the company refused to pay the claim, saying Tiwari had concealed vital facts about cirrhosis of the liver for two years and was hospitalized for the same in 2016.
Ms. Tiwari issued a letter to the Ombudsman, Pune, in September 2017, but was informed that the complaint could not be entertained as it exceeded ₹30 lakh. Ms. Tiwari then approached the commission and said that her husband did not hide any facts about his health, and that she had no source of income and needed money to take care of their minor child.
The Nagpur Bench of the Commission observed, “It cannot be said that the deceased – Rajesh Tiwari has supplied any material information or information for the purpose of invoking section 45 (policy not to be called in question on the ground of misrepresentation after two years)”. had suppressed material facts. Insurance Act. We are of the view that denial of insurance claim on the ground of suppression of material facts was not justified.”
Presiding member AZ Khwaja and member KM Lawande said, “The insurance company was not justified in rejecting the valid insurance claims of the complainant. The company has committed deficiency in service as well as unfair trade practice.”
The commission directed the company to pay ₹60 lakh with interest at the rate of 12% from the date of the order till actual receipt, ₹2 lakh as compensation for mental and physical harassment and ₹25,000 for litigation costs pay the