LIFE July 2019

LIFE July 2019

LIFE July 2019

Consumer forums – Grievances Galore:

Visakhapatnam: Two in every five lodged in consumer forums in north Andhra are related to the insurance sector. According to senior advocate K Muralidhar, over 60% of the 300 cases pending at the consumer forums deal with insurance firms.

Consumers who buy insurance policies, without understanding the terms and conditions properly find themselves in a tricky situation at the time of receiving compensation, he added.

According to the legal fraternity, consumers in the region have been filing cases not only against private insurance companies, but also state-run like the Life Insurance Corporation (LIC) and the New India Assurance Company.

Speaking to TOI, senior advocate Y Srinivas said that many insurance policy holders do not understand Section 45 of the Insurance Act. Consumers come to know about the terms and conditions only when they are applying for compensation. According to Section 45 of the Insurance Act, the life insurance contract between the insurance firm and the policy holder is an important landmark.

Moreover, an insurance firm can reject the claims of relatives of policy holders who are deceased, on grounds of misrepresentation such as age suppression or suppression of a material fact in the event of death of a policy holder, Y Srinivas added.

Moreover, in cases related to insurance firms, forums have been finding fault with the firms for not providing material evidence to prove alleged suppression. As a result, the firms are being asked to pay out the insurance claim along with compensation, lawyers added.

CBI nabs LIC officials for insurance fraud:

CBI has recently booked two officials of LIC of India for allegedly swindling more than Rs 3 crore by making death claims on the basis of forged documents in 190 insurance policies in which they inserted bank accounts of their acquaintances in place of nominees, officials said.

For nearly 10 years between 2008 and 2018, the scan went undetected in Kodad branch of Suryapet district, Telangana. However, an internal audit by the LIC caught the ongoing fraud, the officials added.  Based on a complaint from the LIC, the Central Bureau of Investigation (CBI) registered an FIR against Banoth Beeku Naik, Assistant Administrative Officer and Gugulothu Harya, nine agents and some unidentified persons.

Most of the claims were processed by the above said public servants. However, in most of the cases, the policy holders are alive and death claims have not been received by their respective nominees. The claim amounts were also credited to the bank accounts of public servants, agents and their close relatives, the FIR alleged.

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