Consumer Forum Orders Insurer Refund Over Policy Terms

The Thiruvananthapuram District Consumer Disputes Redressal Commission has mandated an insurance company to refund Rs 2.74 lakh. This significant refund, along with Rs 10,000 for compensation and Rs 3,000 for litigation costs, totals nearly Rs 2.8 lakh. The commission's decision underscores the consumer's right to receive all policy terms before making any payment.

The complainant purchased a policy in 2022, paying an annual premium of Rs 3,09,145. However, he only received the policy handbook, detailing terms and conditions, three months after payment. This delay prevented him from making a fully informed decision about the policy.

Shortly after, the policyholder suffered a stroke, impacting his ability to work and increasing medical expenses. Facing financial pressure, he requested the insurer to cancel the policy and refund the premium, but the company initially refused.

The three-member commission deemed this a special case, noting the lack of proof that the policy handbook was provided before proposal acceptance. The insurer did not contest the allegations by filing a written response.

While ordering the refund, the commission acknowledged the insurer's expenses, allowing them to retain Rs 35,000. This ruling reinforces the necessity for insurers to provide complete policy information upfront to consumers, deeming failure to do so an unfair trade practice.