Pakistan’s top constitutional court has upheld earlier rulings and ordered a takaful company to release a life insurance payout of Rs38.5 million to the nominee of a deceased policyholder, bringing an end to a dispute that had remained unresolved for more than four years. The court dismissed the appeal filed by Pak Qatar Family Takaful, allowing previous orders in favour of the claimant to stand.
The case relates to a family takaful plan purchased in March 2019 by Muhammad Waqas Anjum, who opted for a five-year policy with a death cover of Rs38.5 million against an annual contribution of Rs11,639. Just days after the policy came into effect, Anjum passed away in May 2019. His sister, Arshia Kanwal, was named as the nominee in the policy documents and subsequently filed a claim with the takaful company.
Following Anjum’s death, the takaful operator declined to settle the claim, raising multiple objections. These included questioning the nominee’s relationship with the deceased, citing the absence of certain hospital records, alleging that the policyholder was a drug addict, and pointing to a delay in reporting the death. On these grounds, the company refused to release the takaful payout.
After repeated delays and rejection of the claim, the nominee approached the Federal Insurance Ombudsman. In June 2022, the Ombudsman ruled in her favour, directing the takaful company to pay the full claim amount. The Ombudsman also observed that the claim had been withheld without valid justification and ordered the payment of liquidated damages, while referring the matter to the Securities and Exchange Commission of Pakistan for further review.
The takaful company challenged the Ombudsman’s decision before the Islamabad High Court, while the nominee sought enforcement of the payment order. The High Court dismissed the company’s petition, upheld the Ombudsman’s findings, and directed the takaful operator to comply with the payment and damages order.
Unsuccessful at the High Court, the company then filed an appeal before the Federal Constitutional Court of Pakistan. It argued that the policyholder had failed to fully disclose his medical condition at the time of purchasing the takaful plan and that this non-disclosure invalidated the claim.
The court rejected these arguments, noting that the company had failed to present credible medical or documentary evidence to support allegations of misrepresentation or concealment. It further observed that the death of the policyholder and the nominee’s status were not in dispute, and that delayed reporting alone could not be used as grounds to deny a legitimate claim.
By refusing to entertain the appeal, the court allowed earlier rulings to remain in force, clearing the way for the release of the full takaful payout along with associated damages. The decision reinforces the legal protections available to policyholders and nominees, and underscores the obligation of insurance and takaful operators to honour valid claims without undue delay.
Follow the PakBanker Whatsapp Channel for updates across Pakistan’s banking ecosystem.