Insurance Companies Must Not Repudiate Claims Based On Technicalities, Delhi State Commission Holds New India Assurance Co. Liable

The Delhi State Consumer Disputes Redressal Commission held New India Assurance Co. liable for repudiating a genuine insurance claim based on technicalities. The complainant, an export company, had obtained multiple insurance policies covering stock at its premises. Due to an error, the policy recorded the wrong address. Despite notifying the insurance company and obtaining an endorsement to correct the address, the company delayed and eventually repudiated the claim after a fire incident. The commission found the insurance company guilty of deficiency in service for failing to promptly rectify the address and for repudiating the claim on technical grounds. It emphasized that insurance companies should not reject claims based on minor technicalities, especially when the insured has acted in good faith.