The Uttarakhand State Consumer Disputes Redressal Commission recently ruled in favor of a complainant, Smt. Meera Srivastava, in a case against IFFCO Tokio General Insurance Co. Ltd. The insurance company had denied a personal accident insurance claim made by Srivastava after her husband’s death due to complications from rabies. The policy had been taken out as part of a personal loan agreement, and the husband had been covered from July 2010 to July 2011.
The insurer repudiated the claim, stating that the cause of death did not fall under the definition of “accidental bodily injury” as provided in the policy. However, the Commission rejected this contention, noting that the policy did not contain any express exclusion for rabies or related infections. The Commission observed that the general exclusions section did not reference deaths from viral infections or animal bites.
The Commission also examined the definition of “injury” under the policy, which was defined as an accidental bodily injury caused by external, violent, and visible means. The Commission held that if the rabies infection had resulted from a dog bite or similar external incident, it would fall within this definition. This interpretation is supported by judicial precedents, such as a Supreme Court ruling that death due to a snakebite qualifies as an accident under a personal accident policy.
The Commission applied the principle of “contra proferentem,” which holds that ambiguity in an insurance contract must be interpreted in favor of the policyholder. The Commission ultimately held that the insurer’s decision to repudiate the claim lacked justification and amounted to a deficiency in service under the Consumer Protection Act. The Commission directed the insurer to compensate the complainant with the sum assured under the policy, as well as additional amounts for mental agony and litigation costs.
This decision highlights the importance of clarity and consistency in how insurers handle claim repudiations. The Commission made it clear that exclusions must be expressly stated in the policy document and that insurers cannot rely on vague language or internal interpretations to avoid liability. The ruling sends a strong message that unjustified repudiations, particularly in cases involving personal loss or death, will not be upheld by consumer forums. The decision emphasizes the need for insurers to treat policyholders fairly and transparently and to honor claims when all policy conditions have been met and no clear exclusion applies.