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Imagine losing your vehicle AND 25% of your motor insurance claim! 😳
Just because of ONE mistake.

That’s what happened to Mr. Mool Chand.
Case went through 3 consumer dispute forums.

🚨 Final verdict is something every vehicle owner must know.

In #ClaimStories S01E68 👇 

Imagine you found the perfect motor insurance plan for your vehicle.

You diligently paid all the premiums on time.

But then, when you needed it the most - the insurer rejected your claim all because of a single mistake!

This is EXACTLY what unfolded in the case.

Mool Chand Lalwani was fond of his vehicle, so he found the motor insurance plan that best suited his needs and got his vehicle insured.

But on one unfortunate day, it got stolen. 💔

Panicked but determined, he did what any responsible person would - he reported it to the police and his insurer immediately.

But he faced disappointment - the insurer did not approve his claim!

Why?

🚨 The insurer claimed he was NEGLIGENT.

During the investigation, they found out that Mool Chand had left his keys inside the vehicle before it was stolen.

According to the insurer, this was a VIOLATION of the policy’s terms.

Leaving the keys inside meant he didn’t take “reasonable care” of his vehicle - so they refused to pay the claim.

He decided to fight back and filed a complaint in the District Forum.

Finally, Mool Chand took the first sigh of relief in a while when the District Forum asked the insurer to pay a percentage of the claim amount.

But this relief was short-lived. 😥

The insurer was not convinced by the District Forum’s verdict and took the matter to the State Commission.

However, nothing much changed - the State Commission upheld the District Forum’s verdict.

The insurer STILL wasn’t ready to give up.  🫤

The insurer went to the National Consumer Disputes Redressal Commission (NCDRC).

👩‍⚖️ The Commission heard the case and agreed that leaving the key inside the vehicle was a sign of carelessness.

But the question was - can it be considered a “fundamental breach of the policy’s T&Cs”?  🧐

To find the answer, the Commission referred to previous Supreme Court rulings where a similar series of events had taken place.

And they found their answer…

The National Commission shared that while leaving the key in the vehicle showed some carelessness - it cannot be considered a fundamental breach of the insurance policy’s T&Cs.  📝

Instead of rejecting the claim outright, the courts decided on a non-standard settlement.

What does that mean? 🤔

Instead of paying 100% of the claim amount, the insurer was asked to pay 75% of the claim amount.

But why was the claim settled on a non-standard basis - in simpler words - why did Mool Chand only get 75% of the actual claim amount?

Well, non-standard claim settlements happen, typically when the claimant's actions don't fully align with the policy's terms.

In such cases, the insurer still provides compensation at a reduced rate, acknowledging that the violation wasn't intentional or severely detrimental.

So after a LONG battle…

👩‍⚖️ In the verdict, the court allowed Mool Chand 75% of his claim amount with 9% per annum interest from the date of claim rejection, till the claim is paid.

However, he still faced a loss of 25% of the claim as a punishment for his carelessness. 

So what did we learn from Mool Chand’s experience?

✅ Always read your insurance policy document thoroughly.

Your policy document outlines the terms under which a claim may be approved or rejected.

Read it, understand it, and follow its guidelines strictly.

✅ A little negligence - even if unintentional - can reduce claim payouts.

Mool Chand didn’t lose his vehicle on purpose, but one small mistake still cost him 25% of his claim.

The insurer couldn’t fully deny his claim, but they still reduced the payout because of his carelessness.

✅ If you feel the claim rejection is unjust - complain to grievance redressal authorities.

Ask for clear rejection reasons from your insurer. If you feel the reason for your claim rejection is unjust, escalate your complaint to grievance redressal authorities.

You can file a grievance complaint with insurer’s Grievance Redressal Officer (GRO), who must respond within 15 days.

If unsatisfied with the response, you can escalate it to the Grievance Redressal Cell of IRDAI.

If here too you don’t find an appropriate solution, you can take the case further to the Insurance Ombudsman and, if necessary, the Consumer Court.

P.S. Filing complaints with the GRO, IRDAI or the Ombudsman is free but Consumer Court cases may involve fees.

For more such real-life stories that help you understand your insurance policies better, follow @BeshakIN !

A woman passed away, leaving behind a Rs 4,33,495 hospital bill.💔

Insurer rejected the claim, citing a pre-existing condition that had ALREADY been declared!

Is that even legal?
Find out in #ClaimStories S01E65 !  👇 

Remember how we always tell you - Share all your medical conditions, lifestyle details, etc. when filling out your health insurance proposal form?

This ensures that the insurer is aware of your condition, and provides coverage accordingly.

But what if, even after making honest declarations, your claim is rejected on the grounds of “non-disclosure”?! 😨

Mr Ram Swaroop Singh Chauhan was struggling with this very question when he received a rejection letter from his health insurance company.

His heartbreak began when his wife, Meenu Chauhan, fell seriously ill and had to be hospitalized.

Despite all medical efforts, she had to be shifted to another hospital - where she tragically lost her life. 💔

Amidst his grief, Ram Swaroop filed a claim of Rs 4,33,495 under their family floater health insurance plan.

Since he had always been diligent about their policy, he expected a smooth claim settlement.

But instead, he faced another devastating blow - the claim was denied. 😢

And the reason was even more shocking!

The insurer cited undeclared elevated creatinine levels, which they claimed indicated Chronic Kidney Disease (CKD).

But according to Ram Swaroop, she wasn't suffering from CKD - but from Diabetes and its complications, which he had clearly declared at the time of policy purchase.  🫤

Elevated creatinine levels, sleep disorders, and urinary problems are all complications of Diabetes.  💊

The insurer had accepted the policy with full knowledge of her Diabetes - and even charged a higher premium for it!

So how could they now claim he hid information, and reject his claim?

The matter was taken to the Ombudsman’s court.

The Ombudsman demanded that the insurer justify their claim rejection.

Here’s what they said...

🏢 According to the insurer, Ram Swaroop and Meenu purchased the policy on December 1, 2018.

🏢 A year later, Meenu was hospitalised and lost her life due to multiple health conditions.

Her death summary from the hospital mentioned Chronic Kidney Disease (CKD) and Diabetes Mellitus among other complications as reasons for death.

🏢 During their investigation, the insurer found that Meenu’s creatinine levels had been elevated since December 6, 2018.

This suggests that she likely had CKD before purchasing the policy.

🏢 The proposal form had a specific question:

"Has any member covered under the policy suffered from a renal (kidney) disorder?"

Ram Swaroop had answered "No" to this question.

🏢 As per Condition No. 6 of the policy, the insurer had the right to reject any claim if false information was provided at the time of purchase.

Based on this, they denied the claim.

However, after hearing it all and investigating themselves, the Ombudsman spotted a major loophole…

Ombudsman pointed out two crucial facts:

🧑‍⚖️ Meenu was not diagnosed with CKD before buying the policy - so it wasn't declared.

All other PEDs and medical conditions she had, were already disclosed by Ram Swaroop.

🧑‍⚖️ The insurer had already accepted diabetes and all its complications - and charged extra to give the policy!

So how could they suddenly exclude CKD, which is a known complication of diabetes?

The verdict was now clear…

The Ombudsman ordered the insurer to pay the admissible claim amount to Ram Swaroop within 30 days.

Justice was served. ⚖️

What did we learn from the story?

✅ ALWAYS MAKE HONEST DECLARATIONS!

To answer the question we started with: Can an insurer deny your claim even if you made honest declarations? -

The answer is - NO!

Once you declare any medical condition, and the insurer accepts your application based on it, they cannot reject your claim citing that same disease or its known complications.

This is your legal right!

✅ If your claim is unfairly rejected, escalate it to grievance redressal authorities.

If you have been honest and your claim is admissible, the law will ensure you get what’s rightfully yours.

⚖️ You can first escalate your issue to the insurer's grievance redressal officer.

⚖️ If they don’t resolve your issue, you can approach the IRDAI.
⚖️If even there you don’t get a solution, you always have the Ombudsman to fight for your rights!

✅ From buying the right insurance to claiming what’s rightfully yours, having an expert advisor can make all the difference!

An advisor guides you through understanding insurance plans, filling out forms correctly, and standing up for your rights if needed.

At @BeshakIN, you can connect with top industry experts at your convenience.  🤍

Don’t believe us? Try it yourself!

https://www.beshak.org/advisor/