No Reduction in Sum Assured After Charging Higher Premium: Consumer Forum

The New Delhi District Consumer Disputes Redressal Forum has ordered that, once the premium for a certain amount of sum assured has been charged under a policy, the insurance company can’t reduce the sum assured later when a claim is made. A resident of Delhi has made a complaint against an insurance firm for offering him Rs.1.6 lakh on the theft of his car which was insured for Rs.1.8 lakh.

The person insured his car for Rs.1.8 lakh for the period from 25th August 2007 to 24th August 2008. The insured’s car was stolen on August 25, 2008. The insurance firm after processing the claim had offered Rs.1.6 lakh to the insured. The insured person had said that, insurance company is of the view that his car’s declared value was Rs.1.6 lakh, though he had been charged premium for insuring his car for Rs.1.8 lakh.

The consumer forum declared that, after the theft and issue of policy, insurance company cannot modify the insured’s declared value, when premium for higher sum assured was charged.


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