Insurance firms’ attitude needs to be dealt with iron fist: Forum

Mubarak Ansari
Sunday, 2 July 2017

The forum stated the same while passing an order against SBI Life Insurance Company and asked it to refund Rs 1.14 lakh with 9 per cent interest since 2009, which it had collected
extra, above the required premium.

Pune: The Pune District Consumer Forum has said that there is a need to deal with the high-handedness of insurance companies, which are duping and harassing consumers, with
an iron fist.

The forum stated the same while passing an order against SBI Life Insurance Company and asked it to refund Rs 1.14 lakh with 9 per cent interest since 2009, which it had collected
extra, above the required premium.

Gangadhar Ghayal of Nigdi had filed a complaint against the company in 2015. The company was also directed to pay Rs 10,000 as compensation. Ghayal had subscribed to a certain insurance scheme and paid Rs 4.35 lakh. However, he received policy certificates on September 7, 2009 only for Rs 3.2 lakh. He then approached the company several times for a refund of Rs 1.15 lakh, which they had collected extra. The company accepted this fact only in 2013.

After a lot of persuasion, in 2015, the company replied through its Deccan Gymkhana branch, saying that they are ready to refund this amount to the complainant, with interest at rate of 4 per cent per annum for the period October-2012 to July-2015.

The complainant wrote a letter to the company, demanding a refund of amount together with 12 per cent besides Rs 50,000 compensation towards mental agony. However, the insurance company expressed its inability to do so.  

Therefore, the complaint moved the consumer forum in 2015. The insurance company appeared before the forum and asked for dismissal of the complaint on the ground that their office is located in Mumbai and case is time barred. However, the forum rejected claims of the company and came down heavily on the way of their functioning.

“Before the judgement, we would like to observe that this case exhibits a typical negative and high-handed approach on part of the officers of the insurance company, which increases the litigation in this country. In any case, such defence on part of the insurance company is totally unjustifiable,” read the judgement by Forum President VP Utpat and members Onkar Patil and Kshitija Kulkarni.

“It would not be out of place here, if, we would observe that nowadays insurance companies are trying to convert themselves into profit making organisations and, for the purposes of making business and for earning profit, insurance companies are resorting to such practices, which are unfair trade practices and thereby are duping and harassing consumers.

“Due to mismanagement on the part of insurance company, a poor consumer like the complainant herein had to unnecessarily run from pillar to post for a period of five years. Hence, such type of attitude exhibited by insurance companies needs to be curbed and dealt with an iron fist. For the foregoing reasons, we hold that the complainant has successfully proved his case beyond doubt that the insurance company is guilty of deficiency in service,” the judgement reads.

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