15-05-2025
No denial of third-party accident claim on grounds of wrong insurance policy details: You're still entitled to all benefits, rules Jharkhand HC
Most of us do not remember our car insurance policy details off the back of our hand. Many times, the death of the sole financial decision maker, or the breadwinner of a family, leaves behind members who are unaware of policy details. This might lead people to believe that your insurer can reject your claim or that you are ineligible to make one altogether.
But according to a recent verdict by the Jharkhand High Court in the case of
Reliance General Insurance
Company Limited vs. Lilmuni Madaiyan, your insurer cannot validly reject your claim on merely the grounds that you did not provide correct information related to your
motor insurance policy
.
Read on to know what you can do to get your claim successfully approved in the event of an accident, in case you are unable to provide your policy details correctly to your insurer.
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The case, as it happened
In June 2010, Lakhichand Maraiya, a skilled carpenter earning Rs 9,000/month, was involved in a road accident, which resulted in his immediate death. His wife and children filed a complaint with the MACT (Motor Accident Claims Tribunal).
In 2016, the tribunal awarded them a compensation of around Rs 20 lakh (Rs 20,49,000) and directed the insurer, i.e., Reliance General Insurance, to pay the same. However, the general insurer contested this in the court, saying that the claimants, i.e., the third party (owner of the offending vehicle) who caused the accident, had provided them with the wrong policy number, thereby absolving them of any liability to pay claims associated with the accident.
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Reliance General further contended that this compensation should be recovered from the owner of the offending vehicle.
But, according to the high court, 'Merely providing a wrong policy number by the claimants, the liability of the insurance company cannot be ruled out because the claimants are not supposed to know the exact policy number.'
In 2024,
IRDAI
also issued a statement underlining that insurers cannot deny claims on the grounds of documents not being submitted that were required to be obtained at the time of policy issuance. At the stage of claims, companies can only ask for documents directly related to the claim itself, such as a claim form, repair bill, or FIR, based on the type of policy.
The court further highlighted that the insurance company has not produced any evidence to establish that the accident had taken place due to rash and negligent driving by the driver of the offending vehicle.
'The fact remains that the accident took place and the death has occurred, and in view of that, the charge sheet has been submitted. The oral evidence of the witnesses is consistent on the point of the accident and the earning of the deceased,' it added, thereby upholding the award.
Can insurer deny your claim on the grounds of incorrect or insufficient policy details provided by the policyholder?
Sarita Joshi, Product Head of
Health and Life Insurance
at Probus, says, 'As long as other verifiable information is present, an insurance company usually cannot reject a claim for the absence of a policy number or copy. It is the responsibility of insurers to use alternative information to help identify valid policies.'
'Insurers are required to use reasonable attempts to track down the policy based on the name, registration, or other identifiers of the vehicle in cases involving motor vehicle accidents in which the insured has passed away', she adds.
Chetan Vasudeva, Senior Vice President, Business Development at Elephant. in concurs. According to him, insurance companies cannot deny servicing a claim only based on an incorrect policy number or failure to provide a copy of the policy by the policyholder.
'While it is always advised to share the correct details, policy documents, and other related documents to speed up the process, if the policyholder fails to provide the supportive documents or policy number, insurers are required to identify the policy using other available information, such as contact number, policyholder name, email ID, etc., provided by the policyholder at the time of purchasing the policy,' he explains.
As such, it is a prudent practice to make nominations in both your life and health insurance policies so that your near and dear ones can avail of the benefits of your insurance policy in case of an unfortunate incident without any hassles.
