Thrissur Consumer Commission Holds IFFCO Tokio Liable For Repudiating Accident Insurance Claim
The Thrissur District Consumer Disputes Redressal Commission, comprising C.T. Sabu (President), Sreeja S. (Member), and Ram Mohan R. (Member), held IFFCO Tokio General Insurance Co. Ltd. liable for wrongfully repudiating an accident insurance claim despite the insured suffering functional disability due to the accident. The Commission observed that rejecting a legitimate claim on illogical...
The Thrissur District Consumer Disputes Redressal Commission, comprising C.T. Sabu (President), Sreeja S. (Member), and Ram Mohan R. (Member), held IFFCO Tokio General Insurance Co. Ltd. liable for wrongfully repudiating an accident insurance claim despite the insured suffering functional disability due to the accident. The Commission observed that rejecting a legitimate claim on illogical and unexplained grounds amounts to deficiency in service and an unfair trade practice under the Consumer Protection Act.
Brief facts:
The complainant availed an insurance policy from IFFCO Tokio General Insurance Co. Ltd ('Insurer') at the time of purchase of an electric scooter. The policy was availed for the period 22.11.2019 to 21.11.2024. The capital sum insured for the personal accident of the owner/driver of the vehicle was Rs. 15 lacs. On 19.09.2020, the complainant was met with an accident while riding the scooter and was taken to the general hospital and was diagnosed with 'Quadriplegia'. The complainant also suffered other injuries such as cervical spine injury, laminar fracture and chest injury. He was discharged from the hospital on 2.10.2020 with a bill of Rs. 86,445/- after a treatment of 15 days.
The complainant then lodged the claim with the insurer and also appeared before the medical board that examined him and issued a certificate stating 75% of permanent physical impairment. As per the complainant, the insurer repudiated the claim of the insurer despite submission of medical certificate on the ground that the claim does not fall within the scope of 'personal accident'. Thus, a complaint was filed by the complainant against the insurer and its area sales manager before the Thrissur district commission praying for appropriate compensation.
The insurer and its area sales manager are collectively referred herein as 'opposite parties'.
Submissions of the opposite parties:
It was submitted that the claim of the complainant did not fall under the ambit of 'Personal Accident' and was therefore liable to be rejected.
Observations of the commission:
The Commission observed that the opposite parties have not given any reason as to why the claim of the complainant does not fall within the scope of 'Personal accident'. It was further observed that 75% physical disability underwent by the complainant inflicted 100% functional disability and the insurers, while considering insurance claims, must take into consideration the functional disability.
The commission noted that the blind denial of the claim on unfounded grounds is a result of improper application of mind by the insurer. Thus, the repudiation of the claim was held to be bad in the eyes of law.
The bench further raised concerns regarding such arbitrary denial of insurance claims by companies which is an abuse of the dominant position and defeats the very purpose for which such policies were entered into. The bench termed the act of the insurers of repudiating the claims on unfounded reasons as 'oppressive' and 'unfair' amounting to deficiency in service. It was observed that such conduct, if left unchecked, would reduce accident insurance to an empty promise thereby rendering consumer protection illusory.
Thus, the complaint was allowed with the following reliefs:
1. Rs. 15 lakhs as insurance claim
2. Rs. 5 lakhs as compensation for agony, hardship and financial loss
3. Rs. 10,000 as costs
Case Title: Thomas vs Branch Manager, IFFCO
Case Number: CC/492/21
Date of decision: 29.01.2026