Insurance Company cannot reject claim of insured: DB

A Division Bench of State High Court Comprising Chief Justice N Paul Vasanthakumar and Justice Ali Mohammad Magrey today held that Insurance Company cannot reject the claims of the insured, which can only be rejected on the ground of delayed claim.
DB further held that the Insurance Company being registered under the Insurance Act and being controlled by the Insurance Regulatory and Development Authority, hence directions issued by the said Authority are binding on the Insurance Company.
The said Circular mandates the Insurance Companies not to reject the claims on the ground of delay alone.
On the contrary, the Authority directs the Insurance Companies to entertain the claim, process it and if there is no basis for the claim, it can be rejected. Thus it is evident that no claim of the insured can be rejected only on the ground of delayed claim.
The orders are challenged in this petition by contending that death having occurred after 22 months of fall from the school building which is beyond 12 months from the date of accident causing injuries, the District Forum as well as the State Commission were not justified in awarding the compensation in the light of the clause contained in the policy. Division Bench after hearing both the sides observed that the facts of this case the petitioner-Insurance Company is not justified in taking such hyper technical plea to deny the compensation which was awarded by the District Form and affirmed by the State Commission.
The writ petition is dismissed. The petitioner is directed to pay the compensation amount
Rs 2,80,000 to the respondent within one month. —JNF

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