An Andhra Pradesh consumer commission has directed a private insurance company to pay Rs 50 lakh to the nominee of a man who died in a road accident, after the insurer rejected the claim citing alleged misrepresentation of facts. The commission also directed the insurer to pay Rs 20,000 as compensation for mental agony and Rs 5,000 towards costs after finding that the insurer’s own investigator had called the accident genuine.Kurnool District Consumer Disputes Redressal Commission president Karanam Kishore Kumar and members N Narayana Reddy and S Nazima Kausar were hearing a complaint filed by Yellala Jagadeeshawara Reddy, brother and nominee of Divakar Reddy Yellala, who died in the accident in April 2025. The insurance policy had a sum assured of Rs 50 lakh and was in force when the accident occurred.“The rejection/non-settlement of the claim by the Opposite Party (the insurer), without establishing a valid and substantiated ground under the policy terms and conditions, amounts to deficiency in service. The complainant, being the nominee under the policy, is therefore entitled to receive the Sum Assured of Rs 50 lakh. Having regard to the prolonged non-settlement of the legitimate claim and the hardship and mental agony caused to the complainant, he is also entitled compensation,” the commission said on October 1.The accident occurred when an unknown vehicle allegedly hit Divakar’s motorcycle at about 11.30 pm on April 14, 2025, on NH-40 near Ganesh Godown in Govindapalle village, Sirivella. Divakar suffered bleeding head injuries and died on the spot. His post-mortem report recorded “Head Injury” as the cause of death.Insurer rejects claimThe insurance policy commenced on December 19, 2024, and was valid until December 18, 2025. The premium was Rs 4,767, and Jagadeeshawara Reddy was the nominee. The insurance nominee submitted the claim form on May 8, 2025. The insurer later sought additional documents and rejected the claim. In an email dated June 28, 2025, it said scrutiny and verification had revealed “misrepresentation of facts” to obtain the insurance benefit and that the claim fell outside the policy terms.The insurance company told the commission that the nominee had failed to provide documents despite repeated reminders. It said letters dated May 17, May 19, May 21 and May 25 had sought documents required to process the claim, including the final police report. But the commission found that the insurer had not produced evidence that these communications reached the complainant.No proof that notices reached nomineeThe commission noted that there were no postal receipts, acknowledgements, tracking reports, courier records, email delivery reports or other documentary evidence establishing that the alleged communications had been dispatched and served.Story continues below this adIt said that simply mentioning the dates of the communications was not enough to establish that they had been sent to or received by the complainant. The burden was upon the insurance company to establish that the complainant had been called upon to furnish the documents and given a reasonable opportunity to do so, the commission said.It also relied on the insurance company’s own field verification report. The investigator found the incident to be genuine and the cause of death consistent with the post-mortem report. The commission said the investigation verified the complainant’s account of the accident and death.The commission found that the insurer had not identified the particular fact allegedly misrepresented by the deceased. It said the company had not established what declaration was false, when the alleged misrepresentation was made or how it was material to acceptance of the insurance risk.It said the insurance company had not shown that the absence of the final police report extinguished or suspended its liability under the policy. No evidence was produced to show that the report contained any finding adverse to the claim.Story continues below this adHolding that the rejection of the claim was not supported by a valid ground under the policy terms, the commission held that it amounted to deficiency in service. The insurer was given 45 days from receipt of the order to comply. If it fails to pay within that period, the Rs 50 lakh sum assured will carry interest at 9 per cent per annum from October 6, 2025, the date of the complaint, until realisation.TakeawayIf an insurer rejects a claim citing misrepresentation or missing documents, it should be able to clearly establish the specific violation and show that the claimant was properly asked to provide the required documents.For consumer-related grievances, individuals may contact the consumer helpline in their respective states (Andhra Pradesh helpline: 0866-2551431) or call the National Consumer Helpline at 1915 for assistance.Don’t miss out on these stories:Mobile bill Rs 1.75 lakh after Nepal trip, man secures waiver of amount, Rs 25,000 payoutStory continues below this adMan denied refund after Rs 170 ‘stuck’ in milk app wallet, wins over 15x payoutCancer patient dies after ‘delayed care’, hospital, 2 doctors to pay Rs 5 lakh