Vishakhapatnam District Commission Holds ICICI Prudential Liable For Wrongful Repudiation Of Death Claim

Brief Facts:

The Deceased obtained an insurance policy from ICICI Prudential with a coverage sum assured of Rs. 20,00,000/- and an annual premium of Rs. 3,517/-. The policy was issued through PhonePe and was valid from October 23, 2021, to October 22, 2022. On January 24, 2022, the Deceased sustained serious injuries from a buffalo attack in his village and was initially treated at the Government Hospital PHC in Butchayyapeta. He was later taken to Sri Sri Rama Nursing Home in Ravikamatham as his condition worsened. Despite the treatment, he passed away at home while the policy was still in effect. The Complainant, son and nominee of the Deceased, notified the insurance company of the Deceased's death but received no response. Feeling aggrieved, the Complainant filed a consumer complaint in the District Consumer Disputes Redressal Commission-II, Visakhapatnam, Andhra Pradesh (“District Commission”) against ICICI Prudential.

In response, ICICI Prudential claimed that the complaint was based on a fabricated story to extract money. It also raised preliminary objections, stating that the Complainant didn't submit the required claim form or complete the necessary claim formalities. It argued that there was a lack of personal interaction with the proposer and the absence of the Deceased's contact details. After receiving an incomplete set of documents from the Complainant, it contended that it made efforts to trace the Deceased's address and sent a claim requirement letter on August 24, 2022. The complaint was premature, and the Deceased voluntarily selected the policy through PhonePe's app without any personal interaction. It argued that it adhered to the policy terms and conditions and denied any negligence or deficiency in its service.

Observations by the District Commission:

The District Commission noted that ICICI Prudential presented multiple and inconsistent defences at different stages of the case. Initially, it claimed that the insured's details were untraceable in their records, then alleged that the Complainant didn't submit the required claim forms, and finally argued that the insured died before the policy issuance. The District Commission noted that the inconsistencies in ICICI Prudential's defences made it unreliable and irrelevant to its pleadings.

The District Commission found that ICICI Prudential's claim that the insured died before the policy was issued was unsupported by evidence. It did not file the original investigation report or the master policy of the insurance. Despite knowing the relevant documents were already provided, the District Commission noted that ICICI Prudential still requested them during the complaint's pendency. This behaviour, along with the claim that an investigator was appointed without any supporting documents, led the District Commission to hold ICICI Prudential liable for acting in bad faith to avoid liability.

The District Commission dismissed ICICI Prudential's claims that the insured misrepresented information, as it failed to provide any evidence to substantiate these allegations. The District Commission held that ICICI Prudential, having accepted the premium and entered into an agreement without verifying facts, could not later evade liability by claiming misrepresentation.

Therefore, the District Commission directed ICICI Prudential to play the Complainant the assured sum of Rs. 20,00,000/- with an interest of 4% per annum. Additionally, ICICI Prudential was directed to pay a compensation of Rs. 30,000/- to the Complainant for mental agony and suffering and Rs. 5,000/- for litigation costs.

Case Title: Mutchakarla Naidu vs ICICI Prudential Life Insurance Company Limited and Anr.

Case Number: 184/2022

Date of Pronouncement: 18.05.2024