A Raipur-based firm has won a consumer case against SBI General Insurance, with the Chhattisgarh State Consumer Disputes Redressal Commission directing the insurer to pay Rs 11,16,801 for holding up a claim linked to a vehicle insurance policy.
According to recent news reports, the Commission also awarded Rs 50,000 as compensation for mental distress and Rs 5,000 to cover legal costs.
The verdict came from a Bench led by Justice Gautam Chourdiya and member Pramod Kumar Varma, which set aside an earlier ruling by the District Commission in Raipur. The lower forum had dismissed the firm’s complaint, calling it premature—which the State Commission found unjustified.
Vehicle Handed Over, But Payment Stalled
The case arose after the firm’s insured vehicle was involved in an accident on November 8, 2019.
Following a damage assessment survey by the insurance company, the loss was estimated at a little over Rs 11 lakh. Acting on instructions from the insurer, the firm handed over the damaged vehicle to a salvage dealer.
However, according to the firm, the settlement amount was never released. After several follow-ups did not yield results, the party decided to approach the consumer forum.
Insurer’s Arguments Not Taken Into Account
The insurance company said the claim was not solved as a result of pending clarifications and incomplete documentation.
The Commission, however, rejected this argument. It observed that the insurer had already accepted the survey report and instructed the complainant to part with the damaged vehicle, steps that implied the settlement process had begun.
Once the vehicle was handed over, the Commission said, the company had no valid reason to raise fresh objections or delay the release of payment.
Clear Deficiency In Service, Says Panel
The State Commission noted that holding the claim in limbo after the insured party had complied with all procedural requirements amounted to a deficiency in service and unfair trade practice on the part of the insurance company.
“The insurer had no ground to stall the payment once the survey report was accepted and the vehicle disposed of. The delay caused unnecessary hardship,” the Commission stated in its order.
Interest Also Awarded on Due Amount
Besides the compensation and the legal costs, the Commission also directed the insurer to pay simple interest at 6 per cent per annum on the outstanding claim amount, calculated from the date the complaint was lodged until full payment was made.
