Tata AIG Insurance Claim Rejection Set Aside: Chhattisgarh State Commission Upholds ₹2 Lakh Accident Cover for Deceased Debit Card Holder

May 13, 2026 : In a significant consumer protection ruling, the Chhattisgarh State Consumer Disputes Redressal Commission has dismissed an appeal filed by Tata AIG General Insurance Company and upheld an order directing payment of ₹2 lakh accident insurance benefits to the widow of a deceased Bank of Maharashtra customer. The Commission held that a genuine insurance claim cannot be rejected merely because there was a delay in intimating the insurer, particularly when the accident and death were undisputed and covered under the policy.

The State Commission, comprising Justice Gautam Chourdiya (President) and Pramod Kumar Verma (Member), passed the order on May 13, 2026, in Tata AIG General Insurance Co. Ltd. v. Smt. Mamta Chandrakar & Ors., affirming the earlier decision of the District Consumer Commission, Durg.

The dispute arose after Gajendra Chandrakar, a Bank of Maharashtra account holder, died in a road accident on December 4, 2020. He was covered under a complimentary personal accident insurance policy attached to a RuPay Platinum International Debit Card issued by the bank. The insurance cover provided accidental death benefits of ₹2 lakh during the validity period of the card, which remained active from April 2018 to April 2025.

Following her husband’s death, Mamta Chandrakar submitted the insurance claim along with the required documents through the bank in July 2021. Despite receiving the claim documents, the insurer did not release the insured amount. After serving a legal notice and receiving no relief, she approached the District Consumer Commission alleging deficiency in service by both the bank and the insurance company.

Before the consumer forum, the insurer contended that the claim was not payable because the policy required intimation and submission of the claim within 90 days of the accident. According to Tata AIG, the claim form was submitted well beyond the prescribed period and therefore stood barred under the policy conditions. The insurer also questioned compliance with certain transaction-related requirements linked to the RuPay debit card benefits.

The District Commission, however, partially allowed the complaint and directed payment of the insurance amount. Challenging that decision, Tata AIG approached the State Commission under Section 41 of the Consumer Protection Act, 2019.

After examining the records, the State Commission found that the deceased was a valid RuPay Platinum debit card holder and that the accidental death occurred during the policy period. The Commission also noted that bank records established that the deceased had conducted an ATM transaction of ₹10,000 on December 2, 2020, just two days before the accident, thereby satisfying the transaction-related eligibility requirements under the insurance scheme.

The Commission rejected the insurer’s attempt to deny the claim solely on the ground of delayed intimation. It observed that all essential facts relating to the accident and death were duly established through documentary evidence, including the FIR, death certificate, insurance records, claim documents and bank statements.

Referring to the decisions of the Supreme Court in Gurshinder Singh v. Shriram General Insurance Co. Ltd. and Om Prakash v. Reliance General Insurance Co. Ltd., as well as the subsequent ruling in Trilok Singh v. Manager, Cholamandalam MS General Insurance Co. Ltd., the Commission emphasized that delay in informing the insurer cannot automatically defeat a genuine claim where the occurrence of the insured event is undisputed.

Quoting the principles laid down by the Supreme Court, the Commission observed that repudiation of a claim merely because information was not furnished within the stipulated period is not legally sustainable when the insured event has been established through reliable evidence.

In a significant observation, the Commission stated that “a consumer’s genuine insurance claim cannot be rejected merely on the basis of delay, which is only a technical ground.” The Commission further held that such an approach would be inconsistent with the object of consumer protection laws and settled judicial precedents.

The State Commission concluded that Mamta Chandrakar, being the nominee and legal beneficiary under the insurance scheme, was legally entitled to receive the accidental death benefit. It found that Tata AIG’s refusal to honour the claim amounted to deficiency in service and that the District Commission had correctly appreciated both the facts and the law.

Finding no error in the District Commission’s reasoning, the State Commission dismissed Tata AIG’s appeal and affirmed the order directing payment of the insurance benefit. The parties were directed to bear their own costs.

The ruling reinforces an important principle in insurance law that procedural delays should not override substantive justice. The decision is likely to provide relief to policyholders and nominees facing claim rejections based solely on technical grounds, especially where the insured event and coverage are not in dispute. It also serves as a reminder that consumer forums and courts continue to favour a fair and reasonable interpretation of insurance contracts in cases involving genuine claims.

Case Reference : Appeal No. SC/22/FA/408/2025 Tata AIG General Insurance Co.Ltd. Vs. Smt. Mamta Chandrakar & Ors.