Bank's Failure To Provide Insurance Policy Despite Deducting Premium 'Unfair Trade Practice': Kerala Consumer Forum Orders Compensation

The District Consumer Disputes Redressal Commission at Ernakulam has ordered the Canara Bank to compensate a customer for its failure to provide insurance coverage and certificate to him, despite deducting the premium for the same.

The Bench comprising President D.B. Binu and Members V. Ramachandran and Sreevidhia T.N. observed,

"The actions of the opposite party, i.e., their assurance of providing insurance coverage and a certificate, coupled with their subsequent failure to fulfil this promise despite deducting the premium, signify a clear deficiency in service and unfair trade practice. This deficiency in service has led to the complainant's inability to claim cashless benefits for medical expenses incurred, resulting in substantial hardship and emotional distress."

The complainant averred that the Bank deducted premium from his account for an insurance arrangement with Tata AIG, promising an insurance certificate for the period from March 01, 2020 to February 28, 2022. However, he asserted that the bank repeatedly failed to provide the policy or insurance certificate despite multiple requests. The complainant said that when he underwent medical treatment incurring expenses of Rs.90,000/-, he was unable to claim from the insurance due to the missing policy details.

The Bank was set ex-parte by the Commission on account of its "conscious failure" to submit its version. Rather, the Commission regarded such omission an "admission of the allegations" against them.

The Commission went on to observe that the Bank's consistent failure to respond and address the complainant's grievances indicated their negligence and non-compliance with their commitment, which also amounted to deficiency in service and an unfair trade practice. 

"Considering the evidence, the complainant's unchallenged contentions, and the serious deficiency in service caused by the opposite party, it is evident that the opposite party is liable for unfair trade practices and deficient services. As a result, the complainant has suffered considerable inconvenience, mental distress, hardships, and financial losses. The opposite party bank's consistent failure to fulfil its assurances, address grievances, and comply with commitments demonstrates a glaring lack of transparency, responsibility, and a disregard for the consumer's rights and well-being, thereby constituting a clear affront to the principles of fair and ethical business practices. In conclusion, the complaint is deemed maintainable, and the opposite party is found to have engaged in unfair trade practices and deficient services," the Commission declared.

It thereby directed the Bank to reimburse an amount of Rs. 90000/- incurred by him as medical expenses, Rs 50,000/- towards compensation for the deficiency in its service, mental agony and physical hardships sustained by the complainant, and Rs. 10000/- towards the cost of proceedings.

The Complainant was represented by Advocate T.J. Lakhmanan.

Case Title: George V.T. v. Branch Manager, Canara Bank, Ayappankavu