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Consumer forum slaps penalty and interest for delay in payment of claim

Last Updated: Oct 17, 2013 | 2528 Views

The Chandighar Union Territory consumer forum levied a penalty on United India Insurance Company Limited for unreasonable delay, carelessness and inaction on the part of opposite party to pay the insurance claim. The forum directed the company to pay the plaintiff 9% interest on the claim amount from the date of passing of the order to the date of payment. The forum also slapped a penalty of Rs. 10,000 on the company. The accident occurred in June 2012.

The fact of the case is that the car of Mrs. Padma Bhargava, suffering from cancer, which was parked outside her house, was hit by another vehicle thereby causing damage to the car. After getting the car serviced she lodged an insurance claim. The surveyor assessed the claim of Rs. 5,263. Inspite of TPA approving the claim, the company did not pay the amount.  Waiting for the six months for the claim and constant follow up, she filed an appeal with RTI. Based on the appeal, the company replied that claim was delayed due to incomplete bank details provided by the insured.

The company further clarified that the insurance claim amount was deposited in her bank account in April 2013. However, aggrieved by the action of the insurance company, as she was not intimated about and also the payment came without any compensation or interest, she filed a complaint with the consumer’s forum.

On hearing both the parties the forum passed an order in favor of Mrs. Padma Bhargava directing insurance company to pay 9% interest on the delayed payment and also levied a penalty of Rs. 10,000. 

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