SBI Life: Refuse To Pay Up, Lie, and Drag Aged Widow to Court for 6 Years

12 comments Written on June 20th, 2014 by
Categories: Frauds, Insurance

SBI Life is at it again. Now, they're refusing to pay out insurance, and appealing cases against aged women all the way to the Supreme Court!

Also see: High Court: SBI Life To Blame for Converting Rs. 50,000 to Rs. 248

Here's the case:

  • Kavita and Vijay Sharma bought a house in 2005 with a loan of 9.65 lakh from Union bank.
  • To cover the loan, the Sharmas paid Rs. 1.26 lakh in 2005.
  • This is a large amount - more than 12% as insurance! Obviously the Sharmas were old, probably above 60 years of age. We don't know their age.
  • Unfortunately, Vijay Sharma died in 2008.
  • Note this carefully. 2008.
  • SBI refused to pay insurance on the loan, saying the age proof of the insured was not given.
  • It also claimed it returned the premium amount on the same day it was paid.
  • But this is a blatant lie. The bank statement of Union Bank shows the amount was paid back, but in 2010!
  • 2010 is two years after the death of Vijay Sharma!
  • And think of this. Kavita Sharma, apparently an aged widow, had to go to the district consumer commission, who ruled in her favour because obviously this was a lie from SBI Life. SBI was ordered to pay the insurance and a fine.
  • Then SBI Life dragged the aged Ms. Sharma to the state commission. Which dismissed their complaint.
  • Then they took it to the National Commission. Against an aged widow! Well done, SBI Life. (slow clap)
  • The national commission told SBI Life to go take a hike.

Thanks to @ManojNagpal for the tweets on this. Manoj says they even went to the Supreme Court with a Special Leave Petition which was rejected!

Update: Here's the link of the SC dismissing the Special Leave Petition. thanks to Manoj.

It's 2014. Six years after the death of Mr. Sharma. Six years of legal battle. And it's not apparent SBI Life has paid up even now. They might try another appeal somewhere else.

Would you like that to happen to your loved ones after you die? Why would you ever buy a policy from SBI Life?

Why isn't SBI Life Fined 10 crores?

This is such a disgusting act by SBI that it should have been fined 10 crores by the court and the amount paid to Ms. Sharma. Unless you have such massive fines, the insurance companies will not learn. And we NEED to cut them down.

If the age proof was really not given, then it should have been addressed at the time of the policy being given. If they accepted the premium and kept it for five years, they had to honour the policy, whether age proof was given or not at the time to giving the policy.

And what was Union Bank doing? They obviously needed to have followed up and kept a copy of the policy. After all, it was their loan that was being covered!

This is massive deficiency in service. Refusing insurance to aged widows is the worst form of malpractice, especially by the malicious return of premium two years after a person dies. This sort of behaviour is what causes us to distrust insurance companies. At the very least, IRDA should take notice.

On another note, I hope everyone at SBI Life responsible for doing this rots in hell. I would like to believe in hell, temporarily,so they can be put there.

Here's the National Consumer Commission order:

Related Posts Plugin for WordPress, Blogger...

Tags:

About the Author:
http://www.capitalmind.in
The man behind Capital Mind. Deepak is a co-founder at MarketVision, a financial knowledge company. Deepak also provides data research and consulting services, and now lives in Bangalore. Connect with him at deepakshenoy@gmail.com.

12 comments “SBI Life: Refuse To Pay Up, Lie, and Drag Aged Widow to Court for 6 Years”

Shame, Shame and more Shame for SBI life. Agreed people responsible should rot in hell, but I would prefer them to be behind bars for torturing this poor helpless lady, its the same as killing a person mentally. This applies for Union bank also. Great SBI Life……you had a bad name, now you have proved it with these two stories.

I could not have said it better. I dont want to believe in hell, but for this case sake, I will.

More than SBI Life, I am infuriated with the way justice is being delayed in our country. Time and again we come across cases where the SYSTEM takes too long to come up with remedial measures.Judicial reforms & faster redressal systems must be among the top priorities of Modi government. In the other hand, I wonder what IRDA was doing all this while in this particular case? Were they not an interested party in this whole affair? So much for the regulators in India!!

IRDA should be wound up. it is rotten to the core and cannot be saved now. Its started to infest other good regulators, just see what happened to SEBI after ex IRDA chair took hold. The solution to these blatant fraud and malpractice problems is to put chairman, CEO and every member of the senior management who was involved in deciding to go to appeal in jail for atleast a couple of months, suddenly we will see more customer focused policies in place.

There is more to it behind the scene, I am willing to bet. Someone didn’t get their cut for releasing insurance money. Remember, this is SBI.

Rotten. IRDA should steppin.. but its a rotten authority. I remember being sold SBI life when I took a loan from SBT and thanks to some article on web – I declined it.

SBI LI my foot!
The entire system is pathetic. Yes, P A H E T I C!
The consumer forum is D U B I O U S.
I had a bitter experience with the consumer forum.
We have filed a case in 2001, the victim being a senior citizen, the culprit , a builder, who literally robbed the old man RSVP.2.5 Lakhs in 2001. The district consumer court gave the verdict in our favor, in 2003, then the builder approached State Court, which again gave the verdict in the old man’s favor in 2004, the builder approached the National Commission , which, on the absence of any representation by the builder or his lawyer, gave the verdict in favor of the victim. We came back that night, only to realize a day later that the case was re-considered by the forum at Delhi, obviously influenced by the opponent’s lawyer, and we need no proof here that even the Judge colluded with the culprit!
Justice my foot!
This is a bull-shit world we live in! An entirely rotten world.
The wiseman says:
Never go to The Doctor, The Lawyer, The Police, or a Politician.
You would lose money, more than double the amount you already lost, and you will get your mental peace shattered, you loose belief in the entire system!
Poetic Justice!

Now you look at the SYSTEM. By entering into the system, we not only lost the case, the money, peace of mind, the belief system, we, the common public ,feed the group of lawyers, judges, police, the transportation networks, the hospitality industry, and we provide the living for such a huge number, so that we can get our money back, with an interest specified by the Court! And the court says, the reasonable expectation is the Bank Interest.
Capital Mind!
I have suggested to forget the case in 2001, but the old man would not listen!
We would have saved a few lakhs , if we stayed away, but the old people had such a belief in the system, the constitution says you can go from a local court to District court to high court to Supreme Court to president, PM,…….what not!
Justice my foot!

OK, enough carriying too much baggage on the Consumer Forum.
Coming back to the insurance issue, I had an LIC poilicy back in 2001. After liberalization, slowly many people entered the Insurance Industry, with a view to take their own pie from LIC. Come On! How can they compete with LIC, with more than 1Lakh Crore Business at that time,around 2006-2007? I used to get many calls, but I was never lured into one. The Birla Sunlife people even appointed lady executives, who tried to impress with their SWEET TALK! No, I wouldn’t budge.It took for another year or so, when they were vexed with me and forced a visit to our Office.They were in a very combative mode, but I have shown them the annural performance report of all the Insurance Companies. Apart from LIC, Except SBILife Insurance, all were(are??) in red. Even SBILI was marginally in profit , with around 2% Profit.
The market was flooded with a number of providers, with great offers, but they do not know how they can fulfil their promises. Shall ones you know?
Even one person tried to get business with a guaranteed NAV Policy. I have illustrated how they will work. He was not amused to see a return less than the bank interest. Though he claims… the insurance part is there ,no?????
That is where this article begins

It’s just terrible they try these tactics. Hopefully we will soon get a better IRDA!

Deepak ..cases like mrs sharma just get reported better. I know of so many innocent people who made ghrir 80c savings for many yrs in ulips. Only to realise after 5 yrs tat its come to nothing. Such disillusioned investors tend to stick to their usual fds. N trust anything else. Imagine its been 14 yrs of privatisation of sector n it probably has done more harm then benefit people at large. Nothing will happen to them. Sebi n irda are like over protective n careless parent. One is trying to get too much discipline out of its kids n other is just not bothered about wat kids r upto.

I agree Rachna, this is the problem with the industry.

We need a site that will highlight the bad schemes!