The District Consumer Disputes Redressal Commission, Kurnool has directed ICICI Lombard General Insurance Company to pay a ₹50 lakh insurance claim after finding that the insurer failed to substantiate its decision to reject the claim on grounds of alleged misrepresentation. According to reports from 24Law, the case involved a life insurance policy with a sum assured of ₹50 lakh that was issued on December 19, 2024, and remained valid until December 18, 2025. The premium paid was ₹4,767, with the deceased's brother named as the nominee. The Commission also awarded ₹20,000 as compensation for mental agony and ₹5,000 towards litigation costs, bringing the total payout to ₹55.76 lakh. If the order is not complied with within 45 days, the ₹50 lakh awarded amount will carry interest at 9% per annum from October 6, 2025, until realization.
The insured died in a road accident on April 14, 2025, when an unknown vehicle allegedly hit his motorcycle while he was travelling on it. As reported by 24Law, the insurance policy was active on the date of the accident. Following the death, the nominee submitted the claim form to the insurer on May 8, 2025, along with the FIR, inquest report, post-mortem report and death certificate. The post-mortem report recorded the cause of death as 'Head Injury'. However, the insurer subsequently repudiated the claim, citing alleged misrepresentation and missing documents. The nominee informed the insurer and subsequently submitted the claim form and relevant documents seeking the policy benefit.
ICICI Lombard alleged that there had been misrepresentation of facts to obtain the insurance benefit. According to 24Law, the insurer claimed that the nominee had failed to submit several documents required to process the claim, including the police final report, income-tax returns, a cancelled cheque and other claim-related papers. The insurer maintained that despite several reminders, the required documents were not submitted. In its June 28, 2025 email, ICICI Lombard stated that further scrutiny and verification of the claim documents had revealed misrepresentation of facts to obtain the insurance benefit and that the claim therefore fell outside the policy terms and conditions. The insurer argued that it had repeatedly contacted the nominee and asked him to submit additional documents, including the police final report, income-tax returns, cancelled cheque and other claim-related documents.
The Commission examined the insurer's contention that it had repeatedly contacted the nominee. As reported by 24Law, the insurer referred to communications allegedly sent on May 17, 19, 21 and 25, 2025, but did not produce postal receipts, acknowledgements, tracking reports, courier records, email delivery reports or other evidence establishing that the communications had actually been dispatched and received by the nominee. The Commission held that merely mentioning the dates of alleged communications was not enough to establish that the nominee had received them or had been given a reasonable opportunity to comply with the insurer's requests. According to Vivek Kumar, Advocate, Delhi High Court, the Commission also noted that the insurer had not established that the absence of the police final report, at that stage, extinguished or suspended its contractual liability. Nor had it produced evidence showing that the eventual police report contained anything adverse to the claim.
The Commission concluded that the insurer had failed to establish a valid and substantiated ground under the policy terms for repudiating or withholding the claim. According to Vishal Jain, Founder and Senior Partner at Ayaam Legal, the Commission found that the insurer's own investigator had found the incident 'genuine' and confirmed head injury as the cause of death, recommending the claim as payable. The Commission held that the repudiation and non-settlement of the insurance claim amounted to a deficiency in service. The Commission ruled that the nominee was entitled to receive the full ₹50 lakh sum assured under the policy. The case highlights the importance of insurers providing evidence to substantiate claim repudiation and demonstrating that policyholders or nominees were given a reasonable opportunity to provide any additional documents sought during the claim process. Policyholders and nominees should ensure careful documentation and communication in claim processes, as every letter and email received from the insurance company must be carefully archived.
