Insurance firm ordered to pay Rs 10 lakh for unfair claim rejection

The District Consumer Disputes Redressal Commission, Hisar, has directed the PNB MetLife India Insurance Company Limited to pay Rs 10 lakh with 9 per cent annual interest to the claimant after his claim was rejected by the insurance firm.

The Commission also directed the insurance firm to pay compensation of Rs 25,000 as compensation and another Rs 10,000 as litigation cost.

Commission president Jagdeep Singh with members Rajni Goyat and Amita Aggarwal passed the order. The claimant, Raj Kumar (35), a resident of Rishi Nagar, Hisar, whose brother, Bajrang Singh, had obtained two life insurance policies from PNB MetLife.

Bajrang passed away on October 24, 2020 due to heart failure. Raj Kumar, being the nominee, filed claims under both policies. While the company paid the claim for the first policy (Rs 10 lakh), it denied the second policy claim, citing alleged concealment of medical history and claiming that the policy had been declined earlier with a refund of the premium.

However, the Commission found that PNB MetLife failed to prove that the deceased had concealed any medical facts or that the cancellation letter and refund were ever communicated to him.