While IRDA rules mandate that the policy document is required to be sent to the policyholder within two months there was a delay of more five months, which prompted the consumer forum to penalise the insurer

A Delhi consumer forum has held Apollo Munich Insurance Company guilty of deficiency in service and has ordered it to pay Rs5,000 as compensation to its customer for not sending the renewed policy document within two months, which is mandatory under Insurance Regulatory Development Authority (IRDA) rules.

The District Consumer Disputes Redressal Forum, North (New Delhi) observed that, “In our opinion receipt of the contract writing representing the terms and conditions of insurance policy is the right of the subscriber of the insurance policy and non-receipt of the insurance cover within a period of two months as stipulated in regulation referred to above is a deficiency in service, irrespective of the fact whether actually any damage or loss has been caused to the complainant or not.”

The case relates to New Delhi-resident Vivek Sharma who bought a family health insurance policy from Apollo Munich, valid from 4 September 2008 to 3 September 2009, after paying a premium of Rs9,500. The same policy was renewed in the name of his two sons on paying the premium of Rs2,416 through a cheque. The cheque was received by one, Devender Dhingram, company’s agent and was encashed on 23 September 2009. Further, even two months after encashment of the cheque, he did not receive his policy document. Despite repeated telephonic reminders to Apollo Munich, his issue was not resolved.

Aggrieved, Mr Sharma sent a legal notice, dated 15 February 2010, to the insurance firm, asking to send his policy documents and ID card along with payment receipt. Accordingly, Mr Sharma received the policy on 2 March 2010, more than five months after encashment of the cheque.

He approached consumer court citing that delay in sending the policy documents amounts to deficiency in service and claimed Rs40,000 as compensation. The counsel for Mr Sharma argued that under the guidelines issued by IRDA (Protection of Policy Holder’s Interest) Regulation, 2002, the policy documents are required to be sent within a period of two months from the date of receipt of proposal form by the insurer and failure to send the policy document after 30 days is deficiency in service.

Apollo Munich argued after the receipt of the legal notice, the policy   documents were sent to the complainant on 27 February 2010 in compliance of his notice and no deficiency is attributable to Mr Sharma and he is not entitled for any relief. The company also cited a judgement where it was held that “unless complainant has made allegations of negligence and deficiency in service in the complaint, no amount of evidence could be looked upon a plea not put forward.”

However, the consumer forum did not accept the plea of insurance company stating that there is no such issue involved in the present case and held Apollo Munich guilty for deficiency in service for not sending within a period of two months.