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Insured should be told about exclusion clause

The State Consumer Disputes Redressal Commission has held that repudiation of an insurance claim by invoking an exclusion clause which was not brought to the notice of the insured is arbitrary and not sustainable in the eyes of law.

Holding Bajaj Allianz General Insurance Co Ltd guilty of deficiency in service, the commission directed it to pay the widow of a biker who died in an accident in 2009 the Rs 5 lakh insurance amount along with compensation of Rs 1.60 lakh. The company had repudiated the claim on the ground that 121 mg/ltr of ethyl alcohol was found in the blood sample of the insured victim at the time of the mishap, which violated the policy's terms and conditions.

On December 24, 2009, Achala Marde's husband Rudrani met with an accident and died before being admitted to the hospital. Subsequently, Achala's insurance claim was rejected; following which a district forum rejected her complaint. Aggrieved, in 2011, she filed an appeal in the state commission.

Achala contended that medicines administered to save her husband's life had ethyl substance which reflected in his blood reports. She also said that Rudrani never consumed liquor or any intoxicating substance. Achala alleged that the terms and conditions relied upon by the insurance company were not brought to her husband's notice.

The insurance firm argued that the claim was repudiated for violation of exclusion clause of the policy, stating that the insured was under the influence of alcohol at the time of accident.

The commission pointed out that the police panchnama explicitly says that the insured was hit in the motorbike accident by the rash and negligent driving of the oncoming motorcyclist and criminal proceedings have been lodged against him. It held that it can in no way be established that the presence of alcohol in the blood analysis report was a contributory cause to the fatal accident.

Article referred: http://articles.timesofindia.indiatimes.com/2013-08-01/mumbai/40961001_1_insurance-claim-insurance-firm-fatal-accident

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