Jaipur: Rajasthan High Court has upheld an order directing United India Insurance Company Limited to pay Rs 8.67 lakh to Baroda Rajasthan Kshetriya Gramin Bank for losses suffered in a 2019 dacoity, ruling that the insurer cannot deny a claim over security deficiencies it was already aware of when issuing the policy. Justice Anoop Kumar Dhand dismissed the insurer’s writ petition challenging the award passed by the Permanent Lok Adalat (PLA), Churu, on March 17, 2026. The order was passed on Aug 18 and uploaded Thursday. The case stems from an armed dacoity at the bank’s branch on Jan 4, 2019, in which cash worth Rs 8,67,230 was looted. The insurance company had rejected the claim, arguing that the bank had failed to comply with Reserve Bank of India security guidelines by not installing CCTV cameras or alarm bells and not deploying a security guard or gunman. Appearing for the insurer, advocate Deepak Chandak argued that the absence of these security measures amounted to negligence on the bank’s part. He contended that losses arising from theft, robbery or dacoity caused by such lapses were not covered and said the PLA had overlooked these deficiencies while allowing the claim. The bank’s counsel, Anil Bhandari, opposed the petition, arguing that the alleged deficiencies had been fully disclosed to the insurer before the policy was issued. He submitted that the proposal form clearly stated the branches had no CCTV cameras, alarm bells or security guards. “Despite this disclosure, the insurer charged and accepted the premium and issued the policy,” Bhandari argued. The high court agreed with the bank’s stand, observing that the disclosure was a crucial fact in the case. The court noted that the insurer had the option of insisting that the bank comply with RBI security norms before issuing the policy, but instead chose to issue the insurance cover after accepting the premium. The court held that the insurer was bound by the principle of promissory estoppel and could not later rely on known shortcomings to deny compensation after the robbery. Finding the PLA’s award “reasoned and cogent”, the high court refused to interfere and directed the insurer to pay Rs 8,67,230 along with the applicable interest and other relief granted by the Lok Adalat.
