Insurance Scheme For Advocates Will Be Defeated By The Steep Rise In Premium Amount: Delhi HC Directs Companies To Come Up With Better Solutions [Read Order]

Delhi High Court has directed the Life Insurance Corporation and New India Insurance Company to hold meetings with the Technical Evaluation Committee and the Bar Council of Delhi to address the issue of steep increase in the premium rate for the Chief Minister Advocates Welfare Scheme.

The Single Bench of Justice Prathiba M Singh has also directed the said insurance companies to depute senior officials, who are capable of taking a decision regarding the rates quoted.

These senior officials shall be present on the next date of hearing.

The order has come in a plea moved by the Bar Council of Delhi seeking a direction to be issued to the Delhi Government to complete the process and operationalise the CM Advocates Welfare Scheme.

After perusing the status report filed by the Delhi Government, the court observed that after opening of the financial bids, the insurance companies have substantially increased the amount of premium and reneged on their earlier quotations given in November/December, 2019. The premium, which the insurance companies are now demanding, is almost double for both - the group insurance policy and medi-claim policy.

The court further observed that the rates quoted now by the insurance companies are almost almost double the previous rates.

Whole noting that the sudden increase in the rate of premium over a period of 8-9 months is very steep, the court issued the following direction to the LIC:

'Considering the fact that the quotation has increased by 2.5 times, a meeting shall be held with a senior official of the LIC who is capable of taking decisions, to be nominated by the Mr. Vipin

Anand, Managing Director of LIC. The said official should be empowered to negotiate the terms and conditions of the group insurance policy.'

The court further directed:

'The minutes of the said meeting shall be drawn up by the Secretary (Law). An endeavour shall be made by LIC to find a solution so as to ensure that the premium of the life insurance policies is not increased to such a high level compared to what was given in November and December, 2019.'

The court will next take up the matter on September 15. 

Commenting on the issue Advocate KC Mittal, Chairman, Bar Council of Delhi said;

"Insurance companies cannot indulge in profiteering in these Corona time by asking 3 times their earlier rates. These companies have social obligations and duty to public at large. For advocates welfare Delhi Government has proposed to give free life insurance & health insurance. LIC gave rate of Rs. 2.47&2.80 per thousand in Dec 2019 now they have increased to Rs 7. Similarly New India Assurance Co gave rate of Rs 8500 for advocate plus three family members which is now increased to 22000. The raise by the government insurance companies for Delhi Governments welfare scheme is totally unjustified , unfair profiteering."

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