On October 29, 2022, the District Consumer Commission had ordered the insurance company to refund the premium amount with six percent interest and Rs 10,000 as litigation costs.
The State Consumer Disputes Redressal Commission has given a big decision in the case of reducing the home loan insurance cover period from 25 years to eight years. The commission has rejected the appeal of the insurance company PNB Met Life and upheld the decision to return Rs 11.76 lakh collected as premium from the victim.
On October 29, 2022, the Haridwar District Consumer Commission had ordered the insurance company to refund the premium amount with six per cent interest and Rs 10,000 as litigation costs.
This is the case
KN Gambhir, a resident of Kankhal, Haridwar, had taken one crore rupees as a home loan from Punjab National Bank in the year 2016. At that time, the bank insurance personnel told him that if he insures this loan, then in case of any untoward incident, the family will not suffer any financial loss for the next 25 years.
The insurance company will compensate for that loan amount. In the year 2020, while filing a case in the District Commission, he said that the company insured his loan but did not give the documents. On March 12, 2020, when he downloaded his papers from the company’s site, it was found that the insurance cover was given only from March 10, 2018 to March 10, 2016, i.e. for eight years.
On complaining about this, the company did not listen. The insurance company argued that Gambhir’s age was 62 years at the time of taking the loan and according to the company’s standards, loans cannot be given to older people.
Therefore, the insurance cover period was reduced. Gambhir was also informed about this. To cancel the insurance, the application should have been made within fifteen days of the policy being issued, which was not done.
The insurance company could not prove its logic, many flaws were found
On the appeal of the insurance company against the decision of the District Commission, State Commission President Kumkum Rani and member BS Manral closely examined all aspects. They found that the time of giving the insurance policy document to Gambhir by the company was shown as 12 midnight, which is not acceptable.
Similarly, all the signatures are missing on the insurance proposal form and one policy has its number written differently. Despite it being a group loan insurance, even the signature of the loan giving bank manager is missing on the proposal form.
This also seems to indicate some fraud. After conducting the final hearing on November 5, the State Commission gave its verdict on November 8 and rejected the appeal of the insurance company.
One should be very cautious while taking an insurance policy. Pay more attention to the written document rather than the verbal promises of the insurance company representatives. Otherwise, the insurance cover taken in the absence of information may prove to be useless for you.
Surendra Kumar, former in-charge President- State Consumer Disputes Redressal Commission
