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Murder, they wrote off

My friend recently lost her husband amid very tragic circumstances.

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Pushpa Girimaji

My friend recently lost her husband amid very tragic circumstances. A celebratory gunshot fired during a wedding hit him, killing him immediately. He had a personal accident and health cover, but the insurance company rejected my friend’s claim saying that his death was not an accident, but murder and that murder is not covered under the policy. Is this a correct interpretation? My friend really needs the money to bring up her two children.

From your description of the tragedy, it is very obvious that the death of the insured was an accident. It was not a case of someone deliberately shooting him dead, but because of a gunshot fired during a wedding celebration accidentally hitting him. I really do not see how the insurance company can reject his widow’s claim. Your friend should write to the grievance redress officer of the insurance company asking for payment of the insured amount. If she does not get justice there, she should lodge a complaint either with the insurance ombudsman or the consumer forum.

Can you quote any decisions of the apex consumer court on the issue?

Well, let me begin with a recent decision of the apex consumer court in Royal Sundaram Alliance Vs Pawan Balram Mulchandani (FA No 1357 of 2016, dated September 25, 2018).

This case has its origin in the kidnapping and murder of the insured person and the claim made under the personal accident policy and the repudiation of the claim in May 2009 by the insurance company. In response to the complaint filed against it, the Maharashtra State Consumer Disputes Redressal Commission held the repudiation to be unjust and directed the insurance company to pay the insured amount — Rs 20 lakh — along with 9 per cent interest per annum and Rs 25,000 as costs.

Unhappy, the insurer filed an appeal before the apex consumer court, which not only upheld the order of the State Commission, but also awarded Rs 2 lakh as compensation to the nominee.

While doing so, it referred to the decisions of the National Commission as well as the Supreme Court on the issue and concluded that the rejection of the claim by the insurance company was unjust. It based its conclusion on three main factors: a) that unless the immediate cause of injury was a deliberate and wilful act of the insured himself, it was difficult to hold that the murder was not an ‘accident’; b) Nowhere in the exclusion clause was ‘murder’ mentioned; and c) if there are ambiguities in the policy terms and conditions, it has to be interpreted in favour of the insured.

In Maya Devi vs Life Insurance Corporation of India (order dated May 21, 2008) too, the National Commission had gone into this issue. The insurance company had argued before the State Consumer Disputes Redressal Commission that as the policy holder had been murdered, the nominee was not entitled to claim accidental death benefits.

Rejecting the argument the apex court had pointed out that “...the main part of the policy specifically provides that if the life assured sustains any bodily injury resulting solely and directly from the accident caused by outward violent and visible means, which results in the death of the life assured, heirs would be entitled to get accidental benefit. It is apparent that in case of murder, bodily injury is caused by outward violent and visible means which results in the death”.

The Commission also pointed out that the immediate cause of (bullet) injury was not the result of any deliberate or wilful act of the insured. Thus the death of the insured was accidental, the Commission concluded. It also pointed out that nowhere had the policy document referred to ‘murder’ in the exclusion clause.

In these two cases, the assailants wanted to kill the policy holders. In your friend’s case, it was purely an accident. I do not see how the claim can be repudiated by an insurance company.

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