Investigation by private agency hired by insurance company does not replace police scrutiny: NCDRC

The National Consumer Disputes Redressal Commission (NCDRC) imposed costs of Rs. 1 lakh on insurance company Tata AIG Life Insurance on the grounds of undue harassment, loss, and injury caused to a policy holder.

It was held by the presiding member  that investigation by a private agency hired by the insurance company to investigate an incident cannot replace the investigation conducted by the police.

In the instant case, the petitioner’s husband had obtained four insurance policies from the respondent through one agent. The husband passed away after being hit by a running train.

After his death, wife ans sons received  the benefits from three policies. But the company refused the claim on the fourth policy stating that the death was not an accident but a suicide.

The NCDRC observed that the State Commission relied on the medico-legal opinion of a private agency while determining that the death.

However, later it was concluded that railway accident cannot be ruled as cause of death from the reports of police and post-mortem.

Thus, NCDRC observed that a private agency appointed by the insurance company cannot substitute the police.

Further it was asked to the respondent that out of the costs of Rs 1 lakh, Rs 50,000 was  to be paid to the petitioners and Rs 50,000 to be deposited in the Consumer Legal Aid Account of the State Commission.

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