Madras HC quashes rejection of petitioner's insurance claim by ICICI Lombard

CHENNAI: The Madras High Court (MHC) quashed the rejection of the insurance claim by ICICI Lombard Insurance company to the petitioner claiming the insured amount of her husband as he died during the COVID-19 pandemic.

Justice G K Ilanthirayan held that the demise of the petitioner's husband is very much covered under the policy and wrote that the insurance company should not be too technical and act arbitrarily, the claim cannot be rejected on technical grounds while allowing a petition seeking insurance amount.

"Many times the insurance companies willfully neglect reimbursing the insured, who instead of getting their amount from the company have to pay the Courts for getting their rights enforced, the case on hand is the classic example of the same,"  read the judgment.

Further, the judge directed the ICICI Lombard insurance to disburse the insured amount to the petitioner within four weeks and disposed of the petition.

The petitioner N Lakshmi, moved a petition seeking to quash the rejection of her insurance claim by the insurance company and settle the insured amount.

The petitioner's husband received a loan of Rs. 71 lakh from DCB bank, Chennai, since the loan mandates the loan borrower's life to be insured, he insured his life to the tune of the loan amount in ICICI Lombard insurance company.

In 2021, during the peak of the COVID-19 pandemic, the petitioner's husband succumbed to cardiac arrest, however, the postmortem was not conducted considering the pandemic.

Subsequently, when the petitioner approached the insurance company seeking her husband's insurance money, they repudiated the claim made on the ground that no investigations were done and no postmortem was done and therefore, the cause of death was not known.

Aggrieved by this, the petitioner approached the High Court.

The petitioner's counsel cited the supreme court order in Gurmel Singh Vs. Branch Manager, National Insurance Co. Ltd., case and submitted that once there was valid insurance on payment of a huge sum by way of premium, the insurance company ought not to have become too technical and ought not to have refused to settle the claim on non-submission of documents.

Countering this, the insurance company submitted that, as per the policy condition, the cardiac arrest would not come under the coverage of the policy. Admittedly, the petitioner's husband died due to cardiac arrest, and therefore the insurance policy taken by the petitioner's husband has not been covered.