A bank cannot use the 90-day claim window as a shield when it fails to inform customers of their rights, said a verdict delivered last month by the District Consumer Disputes Redressal Commission (Additional DCF) in Maharashtra’s Nagpur.
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Labelling its refusal as a “deficiency in service and unjust,” the commission ordered the (SBI) to pay the Rs 5 lakh insurance amount with six per cent annual interest from the date the complaint was filed (September 5, 2019).
The commission emphasised that if a bank claims insurance protection is not applicable to a particular card, it must clearly provide the conditions and supporting documentation. In this case, since other cardholders received insurance coverage without any fees, treating customers differently under similar circumstances was deemed unfair and amounted to a “deficiency in service”, it said.
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The bank was also ordered to pay Rs 10,000 for mental agony and litigation costs.
As per the complainant, her husband had an account with the bank’s Tri Junction Cantonment area in Nagpur. She stated that insurance protection up to Rs 5 lakh was being provided to the relevant debit cardholders of the bank.
However, no information about this was given by the opposite party (bank) to her or her husband, the woman claimed.
Her husband died in a road accident in September 2013, and she suffered a major mental shock and took some time in recovering from that grief, the complainant said.
Later, after obtaining information regarding the said insurance scheme, she approached the bank to avail herself of the benefits on March 26, 2019. Despite submitting all necessary documents, the bank kept the claim pending and did not take a decision on it.
After exhausting all the available remedies, she approached the consumer commission to get the insurance claim. She also sought compensation of Rs 50,000 for mental and physical agony, and Rs 20,000 for complaint costs.
The bank, in its written response, contended that the complaint was “false and baseless”. It does not send independent information or documents regarding insurance protection to any debit cardholders, the bank said.
The financial institution also pointed out that the deceased held a ‘MasterCard Classic’ type of ATM/debit card, where no insurance protection was applicable. It also highlighted failure to submit any insurance claim within the mandatory 90-day period.
The commission, after perusal of case details, remarked that following the sudden death of her husband, “it is natural for the complainant to suffer a mental shock and take some time to recover from that situation”.
It rejected the bank’s contention that her card was not insurance-protected, saying they had not submitted any solid document that made a clear mention of it.
On the contrary, the documents on record mention that insurance protection is applicable to other types of debit cards. However, no clear exclusion clause has been mentioned regarding ‘MasterCard Classic’, it noted.
If the bank claims that insurance protection is not applicable to a specific card, then it is necessary to submit the clear conditions and their documentation, the commission underlined.
In the present case, it is seen that insurance protection has been provided to other cardholders without charging any fees, the commission noted.
“Therefore, giving different treatment to different customers under similar circumstances is unfair and constitutes a deficiency in service,” it held.
It is not clear from the documents submitted that the bank had provided any information regarding the debit card to the deceased or his heirs, the commission asserted.
“Had the opposite parties provided such information, the deceased or his heirs would have taken the necessary care,” it said.
Therefore, rejecting the claim on the ground that it was not filed within 90 days cannot be accepted, the commission held, concluding that the bank’s action was “unjust and a deficiency in service”.
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