Claim Settlement Responsibilities: A Look at the Agent vs. Insurance Company.
14 June 2024
Consumer Protection Act >> Consumer Rights | Insurance Claim not processed >> Insurance
A recent revision petition highlights the distinction between an insurance agent's role and the insurance company's responsibility regarding claim settlements. The case involved the wife of a deceased policyholder who filed a claim with the agent (OP-2) after her husband's accidental death. The agent forwarded the claim to the insurance company (OP-1), but the company did not settle it.
The consumer forums at both the district and state level ruled against the agent, holding them jointly liable for the claim amount (?1 lakh) along with the insurance company. However, the agent successfully appealed this decision.
The court acknowledged the agent's role as a facilitator, emphasizing that their duties encompass collecting premiums, delivering policy certificates, and forwarding claims to the insurance company. In this case, the agent demonstrably fulfilled these obligations by promptly forwarding the claim to the insurance company.
The court's decision reinforces the notion that agents cannot be held responsible for delays or denials in claim settlements as long as they perform their designated tasks within a reasonable timeframe. The onus of claim settlement ultimately rests with the insurance company.