ICICI Prudential Life Insurance Ordered To Settle Claim despite Not Issuing Policy

An insurance policy commences the minute its premium amount is received by the insurance company, the Maharashtra State Consumer Commission has held. The Commission was hearing a case where the purchaser of the policy died before the policy could be issued.

 

Vijay Salvi had availed the Home Assurance Policy from ICICI in 2011 according to which, in the event of his death, ICICI would have to settle the home loan taken by him. But, before the policy could be issued, he passed away leaving his medical examination for the policy pending.

 

However, when Mr Salvi had taken a home loan of Rs26, 43,048 from Dewan Housing Finance Corporation Ltd, a one-time premium amount was paid to ICICI which was equal to the home loan amount. The premium amount was refunded by Dewan Housing after Mr Salvi’s death and ICICI refused to settle the home loan on Mr Salvi’s behalf saying they were not bound by contract as the policy was never issued.

 

“Insurance Act, 1938, provides for commencement of risk immediately after receiving an amount of premium,” Commission president PB Joshi and member Narendra Kawde observed while granting relief to Amit, Mr Salvi’s legal heir. The Commission has asked ICICI Prudential Life Insurance to settle Vijay Salvi’s home loan of Rs26,43,048 and pay his legal heir Rs1.25 lakh as compensation for mental agony and litigation expenses.

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9 Flats Sold to 18 People

The economic offences wing (EOW) has launched an inquiry into a Rs15.2-crore cheating case in which a developer is accused of selling nine flats in a building in Khar (Mumbai) to 18 people who do not know one another. The developer is likely to be arrested soon, said the police.

 

A 43-year-old businessman, Om Prakash Chendnani, filed the police complaint. Mr Chendnani said the developer had promised him a flat in Ramkrishna Nagar when he booked a flat in 2007.

 

“The developer is alleged to have shown Chendnani forged work commencement certificates and taken the money,” a police officer said. “The complainant invested the money and when he visited the builder asking for the flat he found the work was not completed. He also learnt that the flat booked in his name was sold to another buyer too.”

 

The police found that the commencement certificate shown to the buyer was a temporary one. The developer had taken Rs1.75 crore from the complainant, said the police. “During investigation we found that the developer has done partial construction and was demanding more money… He did the registration and is now not even completing the construction work... We have booked the developer and his associates for cheating and forgery.”

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Should You Go for Corporate FDs?

Major banks have cut interest rates on term deposits. HDFC and Axis Bank have reduced the...

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