In a significant consumer protection ruling, the national consumer disputes redressal commission (NCDRC) has directed Reliance General Insurance Company Ltd to pay Rs15 lakh to a Himachal Pradesh woman who lost her husband in a road accident, along with 9% interest per annum (pa), Rs20,000 as compensation and Rs10,000 towards litigation costs. The commission dismissed the insurer’s second appeal, stating that there was no substantive question of law involved, thereby upholding the Himachal Pradesh state consumer disputes redressal commission's earlier decision.
In an order last week, the NCDRC bench of Dr Inder Jit Singh says, "The main argument of Reliance General Insurance is that no claim for personal accident was filed and only claim for own damage was filed. However, the insurer has not placed on record complete claim papers due to which it is not possible for us to see the exact nature and quantum of claim made and other facts stated in such claim form. The second argument of Reliance General Insurance is that the personal accident claim is admissible under the policy only if the owner was himself driving the vehicle. However, complete policy documents have not been placed on record, and only a cover note has been placed on record, which makes a mention that 'cover for owner-driver under section III (CSI) Rs15 lakh'. In the absence of a complete policy document, it is not possible for us to know the exact details of ‘inclusion’ and ‘exclusion’ clauses."
The case stems from the tragic death of Budhi Singh, who died in a road accident while travelling in his insured vehicle. His wife, Rama Kumari, filed a claim for the personal accident (PA) cover of Rs15 lakh provided under the insurance policy. Reliance General Insurance, however, denied the claim on multiple grounds, including the assertion that Mr Singh was not driving the vehicle at the time of the accident and that no formal claim for the PA cover had been submitted.
NCDRC rejected these arguments, stating that the insurer had failed to provide complete policy documents or the full set of claim papers, highlighting the insurer’s failure to produce crucial evidence to support its case.
Reliance General’s core contention was that personal accident cover under the policy was applicable only if the insured owner was driving the vehicle at the time of the accident. The company also argued that the complainant never filed a PA claim, and only submitted an own-damage (OD) claim.
These arguments were thoroughly addressed and refuted by the state commission, whose findings were reproduced in the NCDRC order. The state commission observed that the insurer had indeed received a legal notice from the complainant specifically claiming Rs15 lakh under the PA cover, well after the OD claim had been initiated.
Quoting the earlier ruling, NCDRC noted: “The complainant has also submitted OD claim in respect of damage to vehicle in question with the insurance company... In these circumstances, it cannot be said that the complainant has reported only OD claim and did not intimate about claim of personal accidental cover.”
Furthermore, the state commission found that the insurer had been duly notified via a legal notice dated 28 October 2022 regarding the PA claim and yet failed to act.
“However, even after issuance of said notice, the claim of the complainant for personal accident cover on account of death of her husband was not settled by the insurance company,” it stated.
Another crucial detail emerged during the proceedings—while Reliance General argued that Mr Singh was not driving at the time of the accident, the state commission clarified that he was present in the vehicle and died alongside the driver and others.
“At the time of accident, one Hem Singh was driving the vehicle... Owner of the vehicle, Budhi Singh who was sitting in the said vehicle also died in the accident along with driver and other persons,” NCDRC noted from the lower commission’s findings.
With these facts on record, NCDRC concluded that the appeal lacked merit.
“No substantive question of law is involved in the present SA. There is no illegality or material irregularity in the order of the State Commission, hence the same is upheld,” Dr Singh from NCDRC ruled.
The dismissal of Reliance General’s appeal sends a strong message on accountability and transparency in insurance dealings, particularly in cases involving bereaved family members and delayed settlements.
For Ms Kumari, the ruling is not just a legal win but a moral one, affirming that corporations cannot hide behind technicalities when justice and rightful dues are at stake.
(Second Appeal NoNC/SA/262/2025 Date: 2 June 2025)
