₹50L accident claim denied; why nominee won

An insurance company from India faced a ruling to pay a substantial claim after a consumer commission deemed their rejection of a ₹50 lakh accident claim invalid. The incident involved a life insurance policy with a sum assured of ₹50 lakh, issued to a deceased individual with the nominee being his brother. The accident occurred on April 14, 2025, when the insured, riding a motorcycle, was hit by an unknown vehicle. The policy was valid until December 18, 2025, and the premium paid was ₹4,767.

Upon the policyholder's death, the nominee submitted a claim form and required documents to ICICI Lombard General Insurance Company. However, the insurer initially rejected the claim, citing alleged "misrepresentation of facts" and the failure to provide essential documents such as the police final report and income-tax returns. The insurer claimed they had repeatedly reminded the nominee to submit the missing documents, but failed to provide any proof of these reminders or the nominee's receipt of the communications.

The Kurnool Consumer Commission intervened, directing ICICI Lombard to pay the full claim amount, along with compensation for mental anguish and litigation costs. The commission examined the insurer's allegations of misrepresentation and found that their own investigator had deemed the incident genuine, confirming the head injury as the cause of death.

The insurer never specified which fact was misrepresented or how it affected the risk assessment. Additionally, the commission noted that the pending police final report did not negate the insurer's liability.

The commission ruled that the insurer's refusal to pay the claim without valid justification amounted to a deficiency in service. The decision highlights the importance of proper documentation and communication when dealing with insurance claims. Policyholders and nominees should ensure they follow the prescribed procedures and maintain records of all correspondence with the insurer. This case serves as a reminder for insurance companies to substantiate their claims and provide adequate proof to support their decisions.