Prakash Sadhwani vs Life Insurance Corporation of India
Case: On the death of his son Prakash Sadhwani lodged claim documents for Rs. 5 Lakhs. LIC rejected the claim on the basis that insured was having pre-existing disease at the time of buying the policy. Prakash Sadhwani took up the case in Delhi District Consumer Forum.
Judgment: Dec. 2012 – The District Consumer Forum decided that LIC should pay the following.
| Claim Amount | : | Rs. 5,00,000 |
| Award for deficiency & harassment | Rs. 1,00,000 | |
| Litigation Expenses | : | Rs. 50,000 |
| Total | : | Rs. 6,50,000 |
While awarding the Judgement the bench noted: “The bench noted that the evidence given by Sadhwani showed that it was on February 2, 2007, that his son was detected with a cardiomyopathy and there was no history of any disease prior to 2D echo cardiography”. Hence LIC should pay Rs. 6.50 Lakhs (Claim+ Award for deficiency & harassment+ Litigation Expenses)
Implication: It is one of the many cases which are going to Consumer Forum. General tendency of Life Insurance Companies is to deny claim lodged within 3 years of issue of insurance policy.
Term Insurance India welcomes this Judgment.