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Interpretation of 'Threshold Limit' - Insurance - Consumer Forum

The Punjab State Consumer Disputes Redressal Commission, Chandigarh, has held the United India Insurance Company Limited guilty of deficiency in service for rejecting a claim by "misreading and misconstruing" the terms of policy. It has directed the firm to pay to the complainant Rs 1,40,345 with interest at the rate of 9% per annum from the date of repudiation (February 8, 2012) and also pay Rs 25,000 as compensation for harassment.

The complaint was filed by Kamlendra Kanwar of Sector 30, Chandigarh, and his wife against the insurance company from which they had been taking health insurance policies for the last several years. The latest policy was for the period August 26, 2011, to August 25, 2012. In addition to that he had taken "Top up" medicare policy for the same period. After Kanwar's wife, Sushma, fell ill, a claim of Rs 1,40,345 was lodged under the Top-up policy.

The counsel for the insured contended that the claim was wrongly repudiated on vague and irrelevant terms vide letter dated February 8, 2012, giving reasons "the claimed amount is Rs 1,40,345 but the threshold limit is Rs 2 lakh, therefore it cannot be paid."

Article referred: http://timesofindia.indiatimes.com/city/chandigarh/Insurance-company-to-pay-up-Rs-1-6-lakh/articleshow/46802099.cms

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