STATE LIFE INSURANCE CORPORATION OF PAKISTAN vs Mst — 2024 CLD 445 LAHORE-HIGH-COURT-LAHORE

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

STATE LIFE INSURANCE CORPORATION OF PAKISTAN VS Mst. UNDLUS BEGUM S. 47-B---Insurance claim---Compound interest---Scope---Self-subscribed Group Insurance Scheme---Appellant/Insurance company was aggrieved of judgment passed by Trial Court in favour of respondent/widow by applying compound interest, who was widow of a Sales Manager---Validity---Scheme was under Memorandum of Understanding (MOU) and was a voluntary self-subscribed additional group insurance---Scheme was introduced for the benefit of Sales Managers, Sales Officers and Sales Representatives---As per terms of MOU, Sales Managers and Sales Officers were to be automatically included in the Scheme whereas only Sales Representatives were made eligible provided they had completed at least Rs.15,000 (Rs.10,000 after amendment) First Year Premium (FYP) during the previous calendar year---Requirement to complete FYP was not applicable to Sales Managers (like the husband of respondent) or Sales Officers---Rejection of claim by appellant/company was misconceived and flawed---Wrongful repudiation of claim of respondent/widow by appellant/company, after considerable and unexplained delay could not be countenanced---Insurance contract was aimed to help the insured or his legal heirs to bounce back from certain unforeseen disasters such as death---When an insurance company attempted to renege on its obligations, such act was in bad faith, which included unreasonable delay in processing a claim---Delay in intimating rejection/repudiation of claim of respondent/widow resulted into limitation issue for the insured (including his heirs)---Legal as well as equitable obligations to act in good faith towards each other was squarely applicable to the insurer who was required to act in an honest and upright manner to fulfil its promise---Rejection/repudiation of insurance claims on flimsy and baseless grounds offended principles of equity and justice---Appellant/company was estopped from taking undue advantage by retaining the sums that were due and payable to claimant like respondent/widow---Claim of respondent/widow was genuine and should have been allowed well in time---Denying and repudiating the claim with an inordinate delay in itself exhibited lack of bona fide on part of appellant/company---High Court maintained judgment and decree passed by Trial Court to the extent of claim of respondent/widow amounting to Rs.600,000/- along with compensatory costs of Rs.1,000,000 but findings to the extent of award of compound interest on the claim were set aside---Appeal was dismissed accordingly.

STATE LIFE INSURANCE CORPORATION OF PAKISTAN vs Mst — 2024 CLD 445 LAHORE-HIGH-COURT-LAHORE

Case information

Judgment text as reported

Other judgments reported in 2024 CLD