Insurance firm ordered to pay ₹10.29 lakh to wife of deceased borrower

The Permanent Lok Adalat in Coimbatore on Monday ordered an insurance firm to pay ₹ 10.29 lakh to a woman so that she could close the loan availed by her deceased husband in 2018.

N. Umarani, chairman of the Permanent Lok Adalath, Coimbatore, also ordered the insurance firm to pay ₹ 50,000 as compensation to the woman. Sources said Santhoshkumar from Ottarpalayam, who worked with the Indian Oil Corporation, had availed himself of a loan of ₹ 10 lakh from a private bank in January 2018.

The loan had an insurance coverage which was offered by the insurance wing of the same bank. The monthly repayment against the loan was stalled after Santhoshkumar died in November 2019. His wife Suganya approached the Permanent Lok Adalat after the bank allegedly demanded she close the loan by making complete payment and the insurance firm did not process the insurance coverage.

The Permanent Lok Adalat heard the woman’s petition and its chairman Ms. Umarani ordered the insurance firm to pay ₹ 10.29 lakh to Suganya within 15 days, so that she could close the loan availed by her husband.

If the insurance firm failed to pay the sum, 6 % of interest will apply to the amount which will be calculated from the date of Santhoshkumar’s death, the chairman ordered. In addition, Suganya should be paid a compensation of ₹ 50,000.

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Printable version | Oct 26, 2021 9:32:50 AM |

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