Consumer Body Orders Insurer to Pay ₹2 Crore to Widow Over Claim Rejection

The National Consumer Disputes Redressal Commission (NCDRC) has directed an insurance company to pay ₹2 crore along with interest to a widow after finding the rejection of her claim to be partially unjustified. The case arose from two life insurance policies taken by the deceased, each valued at ₹2 crore, leading to a total claim of ₹4 crore.

The insurer had repudiated the claim on the grounds of alleged suppression of material facts, including non-disclosure of prior health conditions and insurance policies. However, the Commission found that such allegations were not sufficiently substantiated in relation to one of the policies and held that the rejection could not be sustained entirely.

While granting relief for one policy, the Commission upheld the rejection of the second policy, concluding that the insurer had valid grounds in that instance. This resulted in a partial allowance of the claim, awarding ₹2 crore instead of the full ₹4 crore sought by the complainant.

The ruling reinforces the principle that insurance claim repudiation must be based on clear and credible evidence, and insurers bear the burden of proving suppression or misrepresentation. Mere suspicion or unverified assertions cannot justify denial of legitimate claims.

This decision is significant for policyholders as it strengthens consumer protection in insurance disputes and underscores the accountability of insurers in handling claims fairly and transparently.