Delhi State Commission orders ICICI Lombard to pay Compensation for not Paying Car Insurance Claim

The Delhi State Commission, led by Justice Sangita Dhingra Sehgal and Ms. Pinki, has ruled that ICICI Lombard General Insurance is liable for deficiency in service and cannot reject a claim solely due to the failure to strictly follow procedural formalities.
The case involved a complainant who had insured their car with ICICI Lombard for a specific coverage period. After the car was involved in an accident, the complainant submitted a claim to the insurer. However, despite several follow-ups and a legal notice, the insurer did not process or settle the claim. Feeling aggrieved, the complainant approached the District Commission, which ruled in their favor. The District Commission ordered the insurer to refund Rs. 2,40,331 along with 10% interest, pay Rs. 5,000 as compensation, and cover Rs. 5,000 in litigation costs.
ICICI Lombard appealed the decision before the Delhi State Commission. The insurer argued that the complainant had not notified them about the accident in accordance with the policy terms. They claimed that no claim was recorded in their system and highlighted the importance of following procedural requirements, which they alleged the complainant had failed to do. Additionally, the insurer contended that the legal notice sent by the complainant could not be considered as the required accident intimation.
However, the State Commission found that the complainant had promptly filed an FIR and sent a legal notice, which the insurer did not deny receiving. The Commission ruled that the complainant’s failure to strictly follow the procedural requirements should not be used as a reason to dismiss the claim. Citing previous rulings, including Reliance General Insurance Co. Ltd. vs. Ram Awadh Singh and Oriental Insurance Co. Ltd. vs. Rajinder Singh, the Commission stated that the complainant had sufficiently complied with the necessary actions.
The State Commission upheld the District Commission’s decision, emphasizing that ICICI Lombard had demonstrated clear deficiency in service by failing to process the claim.