RAIPUR: The Chhattisgarh government has blacklisted public sector insurer The Oriental Insurance Company Limited (OICL) for three years over the alleged delay in settling an insurance claim for a state-owned helicopter that crashed at Raipur’s Swami Vivekananda Airport in May 2022.
The action by the State Directorate of Aviation follows a four-year dispute over the insurance payout. Despite the state government paying the insurance premium in full, OICL rejected the claim in August 2026 after keeping it pending for more than four years.
Treating the repudiation and extended delay as a blatant breach of contractual obligations, state aviation authorities initiated disciplinary proceedings against the insurer. Officials issued a formal show-cause notice, reviewed OICL’s written submissions, and conducted a personal hearing before issuing a comprehensive, reasoned order barring the company from participating in state government business for the next three years.
"This is public property paid for by taxpayers," a senior state official said. "When statutory premiums have been fulfilled on time, sitting on a high-value state asset claim for years is completely unacceptable. Service providers engaged with public institutions cannot run on arbitrary timelines or shirk basic accountability,” he told the TNIE.
Authorities emphasised that the blacklisting serves as a firm deterrent against vendor inertia across state departments, underscoring that institutional delays directly bleed public resources.
The penalty does not mark the end of the financial dispute. State officials confirmed that Chhattisgarh will aggressively pursue recovery of the contested payout through administrative tribunals and judicial avenues to safeguard public revenue.
The action highlights the importance of accountability and timely performance by service providers handling government contracts, particularly where public assets and finances are involved.
