URMILA SINDHURIA vs SENIOR BRANCH MANAGER, LIFE INSURANCE CORPORATION OF INDIA

SMT. Urmila Sindhuria has come up in appeal against the order dated 20.9.1994 passed by the learned District Forum, Faridabad, by which her claim for insurance amount of Rs. 25,000/- on account of the death of her husband on 14.10.1990 has been allowed but without any interest thereon. The husband of the complainant-appellant had taken out a double accident benefit policy for a sum of Rs. 25,000/-. After the death of her husband on 14.10.1990, the complainant being his nominee, approached the Life Insurance Corporation of India for the payment of the insured amount. Her claim as repudiated on the ground that the death was not due to head injuries. Feeling aggrieved against the same, the complainant approached the learned District Forum for the redressal of her grievance and there also the Life Insurance Corporation reiterated their old stand. After examining the matter in detail and after going through the necessary record, the learned District Forum came to the conclusion that the death was the direct result of the head injury and that the complainant was entitled to receive the sum insured, i.e. Rs. 25,000/- under the aforesaid policy. However, instead of allowing interest on the amount insured, the learned District Forum issued the direction that in case the payment was not made within two months then the LIC shall be liable to pay the insured amount alongwith interest at the rate of 18% p.a. from the date of award till the date of realisation.

IN the appeal before us, the learned Counsel for the complainant-appellant has vehemently contended that the LIC having failed to make the payment in time and has wrongly repudiated the claim, the learned District Forum should have allowed the complaint with interest instead of issuing direction for payment of interest only on the happening of a certain contingency, i.e. in the case of non-payment within two months. After hearing the learned Counsel for the parties, we are of the considered view that now since even that contingency has happened and the Insurance Company has not made the payment, the appeal is allowed. Accordingly, we accept the appeal and direct the LIC to make the payment of Rs. 25,000/-, the sum insured, alongwith 18% interest p.a. thereon with effect from the date of the order, i.e. 20.9.1994, till its payment to the complainant. The LIC is directed to make this payment positively within one month from the receipt of a copy of this order. The complainant shall also be entitled to costs of this litigation, which are quantified at Rs. 1,000/-. Appeal allowed with costs.