Delay In Remitting Premiums Is Not Consumers' Responsibility, Kolkata District Commission Holds Oriental Bank Of Commerce And Oriental Insurance Co. Liable

Brief Facts:

Mrs. Niva Dey and Mr. Sourindra Mohan Dey (“Complainants”) had a Savings Bank Account with Oriental Bank of Commerce (“Bank). Later, the Complainants secured a Mediclaim Insurance Policy from Oriental Insurance Co. Ltd. (“Insurance Company”) which covered both Complainants. The Complainants paid a premium of Rs. 6,991/- which was encashed by the bank. The policy provided a coverage of Rs. 5 lakh to the Complainants. Later, the Complainants met with a road accident, resulting in severe injuries to Mr Dey, who incurred medical expenses of Rs. 66,789.50/- for his treatment. Despite numerous requests, the bank didn't provide policy documents to the Complainant or cooperate in securing reimbursement. Then, the Complainants approached the Consumer Grievance Redressal Cell, Govt. of West Bengal but were dissatisfied with the resolution. Thereafter, the Complainants approached the District Consumer Disputes Redressal Commission, Kolkata-III, West Bengal (“District Commission”) and filed a consumer complaint against the bank and the insurance company.

In response, the bank contended that the complaint was not maintainable, asserting that there was a delay on the part of the bank in sending the premium amount to the insurance company due to holidays. On the other hand, the insurance company argued that the Mediclaim policy issued in favour of the Complainants was valid from 20/12/2016 to 19/12/2017. Hence, it asserted that the Complainants were not entitled to relief, as the accident which occurred on 13/12/2016 was outside the policy coverage period. Therefore, the insurance company prayed for the dismissal of the claim.

Observations by the Commission:

The District Commission noted that the premium for the insurance policy of Rs. 6,991/- was deducted from the Complainants' Savings Bank Account on 9/12/2016. However, a discrepancy arose as the insurance company claimed the policy was effective from 20/12/2016 to 19/12/2017 and therefore didn't align with the date of premium deduction on 9/12/2016. The bank contended that there was a delay in sending the proposal form and demand draft to the insurance company due to holidays. The District Commission held that this explanation on the part of the bank was not valid and suggested a lackadaisical approach on the part of the bank, especially considering that the bank immediately deducted the premium from the Complainants' account.

Further, the District Commission held that the bank acted on behalf of the insurance company, as per their contractual relationship. The District Commission held that the delays in remitting premiums should not burden the Complainants. Therefore, the District Commission held the insurance company and the bank liable for deficiency in services.

The District Commission directed the bank and the insurance company to pay Rs. 66,790/- with interest to the Complainants. Additionally, they were instructed to provide Rs. 30,000/- for compensation and litigation costs incurred by the Complainant.