Consumer protection: Bank held liable for changing policy without consent

The State Commission allowed the complaint and directed the bank and the insurer to be jointly and severally liable for compensating the loss, along with interest at 10 per cent

Shri Sanwar Mal Sharma, sole proprietor of Sunil Timbers in Banswara, had approached ICICI Bank for a business loan of ₹34 lakh. As part of the loan process, a policy had to be purchased to insure the stocks and goods against the risk of fire and burglary. A loan of ₹34,85,632 was sanctioned on June 9, 2007, which included the total insurance premium of ₹85,632. The EMIs were calculated on the entire sanctioned amount. The bank also procured a Home Safe Plus Merchant Insurance Policy from ICICI Lombard General Insurance.

 

On August 4, 2009, a fire broke out, destroying the