A division bench comprising Justice Garima Prashad and Justice Prakash Padia quashed the insurer's rejection after reviewing the provisions of the Mukhyamantri Kisan Evam Sarvahit Bima Yojana. The judges emphasized that while personal accident coverage is tied to the breadwinner, death benefits must be distributed directly to legal heirs or nominees. Consequently, the court ordered the Oriental Insurance Company to issue the Rs 5 lakh sum within four weeks of receiving the certified judgment. The district magistrate of Basti has been tasked with facilitating the execution of this payment.
Key points
Insurers cannot rely on family coverage definitions to disqualify legal heirs from receiv…: Insurers cannot rely on family coverage definitions to disqualify legal heirs from receiving established death payouts.
Scheme rules specifically obligate insurance providers to release death benefits to desig…: Scheme rules specifically obligate insurance providers to release death benefits to designated nominees or legal heirs of the deceased.
Local administrative authorities in Basti will actively facilitate the mandated insurance…: Local administrative authorities in Basti will actively facilitate the mandated insurance disbursement to the surviving sister.
Sources checked by our analysis pipeline: 1
NEW DELHI: The Allahabad high court has ruled that an unmarried sister cannot be denied the accidental death benefit merely because she is not listed as a covered family member. It directed an insurance company to pay Rs 5 lakh to a woman whose claim it had rejected.
In its October 26, 2026, order, the high court quashed the Oriental Insurance Company’s rejection of the claim under the Mukhyamantri Kisan Evam Sarvahit Bima Yojana.
Why did the insurance company reject the claim?
As per the court order, the woman’s brother died in a road accident on May 18, 2019. She said that he was the sole breadwinner of the household and that she, being unmarried, was dependent on him.
After his death, she sought Rs 5 lakh under the state’s insurance scheme. In October 2019, the insurance company rejected her claim, saying that a sister was not included in the definition of family in the scheme’s memorandum of understanding.
The matter was then placed before the district committee in Basti. After considering a report from the sub-divisional magistrate, the committee…
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