Bank held liable for delay in insurance purchase

The National Commission observed that procrastination by the bank in deducting the premium, despite having obtained authorisation, had led to a delay in policy issuance

Saraswati Paul had applied to the State Bank of India, Radhanagar Branch, for a loan for her grocery business. A loan of Rs 8.99 lakh was sanctioned on March 28, 2008. The terms of the loan stipulated that insurance coverage was necessary to cover risks to goods and property pertaining to the business.
 

On February 6, 2009, the bank debited Rs 2,892 from Saraswati’s account for payment of premium to obtain two Standard Fire and Perils Policies from New India Assurance Co. These policies were valid from February 9, 2009, to February 8, 2010.
 

On January 5, 2009, the truck