The state government has alleged that the insurer rejected claims on frivolous grounds and there was a deficiency in the services offered. It has demanded that the company should settle all the claims that the farmers have raised.
The move comes after a committee appointed by the state government comprising its representative, an ICICI Lombard executive and consultant Kabal Insurance Services recommended in February that the insurer should honour 57 claims, giving the benefit of doubt to the insured.
ICICI Lombard executives declined to comment saying that the matter is sub-judice. Company sources, however, said the insurer has settled the claims in line with the committee's recommendations.
The petition was filed in the National Consumer Redressal Forum in March and the case was admitted last month.
The hearing is scheduled later this month. The dispute has its origin in January 2005 when the Maharashtra government tied up with ICICI Lombard to launch a personal accident policy called Shetkari Apghat Bima Yojana.
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The cover was for 15 months ending April 2006 and provided a cover of Rs 1 lakh in case of accidental death and Rs 50,000 for total disablement due to accident. ICICI Lombard received around 3,900 claims, settled 638 and rejected the rest.
Of the rejected claims, 327 were rejected for "needless perils", 954 for "lack of documents" and 1,967 for being "out of the policy scope". State government officials said another 21 cases are being processed.
After the policy ended in April 2006, there was a gap of 96 days for awarding the policy to another insurer and in that period