THE CONSUMER DISPUTES REDRESSAL FORUM, KOTTAYAM

Present:

Sri. Santhosh Kesavanath P., President

Smt. Bindhu M. Thomas, Member

Sri. K.N. Radhakrishnan, Member

CC. No. 166/2009

Thursday, the 25^th day of February, 2010

Petitioner : 1) Jacob Punnen,

Paraekulam House,

Manganam, Muttambalam P.O

Kottayam.

2. Marina Punnen,

--do—

(By Adv. Santhosh Modayil)

Vs.

Opposite parties : 1) M/s. Inited India Insurance Co. Ltd.,

24, Whites Road, Chennai

reptd. By its Chairman and

Managing Director.

2. The Branch Manager,

M/s. United India Insurance Co. Ltd,

Paraekulam Building,

Collectorate P.O.

Kottayam.

(By Adv. Agi Joseph)

O R D E R

Sri. Santhosh Kesavanath P., President.

Case of the petitioner’s is as follows:

First petitioner is a business man and the second petitioner is his wife. First opposite party is a subsidiary company of General Insurance Company and is doing general insurance. Second opposite party is the branch office of the first opposite party at Kottayam. First petitioner had taken a personal accident policy covering medical expenses , sickness and deceases from the second opposite party in the year 1982 and both petitioners are insured under the said policy. The name of the policy is medi claim gold policy and was renewed periodically on the same terms up to the year 2008-09. The total liability coverage under the policy was Rs. 8,00,000/- (ie. Rs. 4,25,000/- for the first petitioner and Rs. 3,75,000/- for the second petitioner). First

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petitioner remitted the premium demanded by the opposite parties each year. The renewed policy is for the period from 28..3..2008 to 27..3..2009. The second petitioner undergone Angioplasty treatment at Apollo Hospital, Chennai and was treated as inpatient in the said hospital from 9..6..2008 to 12..6..2008. First petitioner submitted a claim for Rs. 3,82,705.27 on 15..7..2008 before the opposite parties in connection with the treatment of the second petitioner. Opposite parties accepted the claim partly and paid an amount of Rs. 2,00,000/- to the petitioner. On 10..10..2008 the first petitioner issued a letter to the 2^nd opposite party stating that the said amount was received under protest. Again on 22..10..2008 first petitioner issued a registered letter to the ist opposite party explaining his grievances and demanding the entire amount due to him as per the claim preferred. The 1^st opposite party accepted the letter on 25..10..2008. First opposite party sent a reply stating that as per the terms and conditions of the policy opposite parties are liable to pay only 70% of the sum insured or maximum 2 lakhs which ever is less in case of any major surgery Angioplasty. First petitioner issued registered letter to the first opposite party on 9…12..2008 demanding the entire amount of Rs. 3,82,705.27 from the opposite parties. According to the petitioner the act of the opposite party in repudiating the claim of the petitioner is a clear deficiency in service. Further more, opposite party has no right to unilaterally vary the terms of the existing policy without the knowledge and consent of the petitioners. So, petitioner prays for a direction to the opposite parties to pay an amount of Rs. 2,07,705/-, as per the statement of accounts appended to the petition, with 18% interest from the date of the petition till payment. along with cost and compensation.

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Opposite parties entered appearance and filed version contenting that petition is not maintainable. According to the opposite party the policy of the company will not renewed on the same terms and conditions in every year. The terms and conditions of the policy is prepared by insurance company by prior approval of IRDA. IRDA is a statutory body created under the insurance act. The terms and conditions of the policy is changing periodically. So, terms and conditions of the policy cannot be changed by the insurance company according to the taste or interest of a particular policy holder. Policy holder is binding on the conditions of policy at the relevant time. In the prior policy the sum assured for both parties are only 3 lakhs. But in the relevant policy sum assured is Rs. 4,25,000/- and Rs. 3,75,000/- respectively. According to the opposite party, there is no deficiency in service on their part. Payment of Rs. 2,00,000/- to the petitioner is legally valid and correct. Opposite party prays for a dismissal of the petition with their costs.

Points for determinations are:

1. Whether there is deficiency in service on the part of the opposite party?

2. Reliefs and costs.

Evidence in this case consists of affidavit filed by both parties and Ext. A1 to A9 documents on the side of the opposite party.

Point No. 1

Material question to be considered in this case is whether the uni lateral inclusion of terms of the existing policy without the knowledge and consent of the petitioners is legal. Petitioner produced individual medi claim policy of the petitioner for a period from 28..3..2006 to 27..3..2007. Said document is marked as Ext. A1. As per Ext. A1 the sum insured for both petitioners are for Rs. 3,00,000/-. Petitioner

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produced the individual health insurance policy for the period of insurance from 28..3..2008 to 27..3..2009 said document is marked as Ext. A2. As per Ext. A2 the sum insured for the first petitioner is Rs. 4,25,000/- and the second petitioner is Rs. 3,75,000/-. In Ext. A2 as per conditions 1.2 (d) in case of major surgery and Angioplasty the limit of the policy restricted to 70% of the sum insured or maximum Rs. 2,00,000/-. According to the petitioner the limits and restrictions on insured sum is varied without knowledge and consent of the petitioners. According to the opposite party the terms and conditions of the policy is prepared by the insurance company by approval of the IRDA and is common for all for a specified period. Counsel for opposite party vehemently argued that an insurance is contract between 2 parties and terms and conditions of the policy for a type of policy is binding on parties . So, petitioner is binding by the varied terms in Ext. A2 policy. In our view argument raised by learned counsel for opposite party is not acceptable because an insurance contract is a species of commercial transactions and must be constructed like any other contract on its own terms and by itself albeit subject to the additional requirement of uberrima fides, ie. good faith on the part of the insured. Opposite party has no case that the vary of the terms of existing policy is noticed to the knowledge of the petitioner. Further more, before varying the terms on the previous proposal or declaration opposite party has not given any intimation to the petitioner or else the consent of the petitioner is brought. So, in our view the act of the opposite party in allowing a part of the claim of the petitioner is a clear deficiency in service. So, point No. 1 is found accordingly.

Point No. 2

In view of the finding in point No. 1, petition is allowed in part and the petitioner is entitled for the following reliefs.

i) Opposite party is ordered to pay the petitioner an amount of Rs.

1,75,000/- being the balance amount to be payable to the petitioner as

per Ext. A2 policy.

2. Opposite party is also ordered to pay an amount of Rs. 5,000/- as

compensation.

Order shall be complied with within one month if the order is not complied within the stipulated time the award amount will carrying 9% interest till realization.

Dictated by me transcribed by the Confidential Assistant corrected by me and

pronounced in the Open Forum on this the 25^th day of February, 2010.

Sri. Santhosh Kesavanath P. President Sd/-

Smt. Bindhu M. Thomas, Member Sd/-

Sri. K.N. Radhakrishnan, Member Sd/-

APPENDIX

Documents for the petitioner:

Ext. A1: Individual Health Insurance Policy with vide No.

100505/48/05/20/00001556.

Ext. A2: Individual Health Insurance Policy with vide No.

100505/48/07/97/00002034.

Ext. A3: Copy of letter Dtd: 10..10..2008

Ext. A4: Copy of letter Dtd: 22..10..2008 issued by first petitioner to the Branch

Manager.

Ext. A5: Acknowledgement card.

Ext. A6: Copy of letter issued by the opposite party to Mr. Jacob Punnen

Ext. A7: Letter Dtd: 9..12..2008 issued by Jacob Punnan to G. Sreenivasan

Ext. A8 series Postal receipts (3 Nos.)

Ext. A9 Postal AD Card (2 Nos.)

Documents for the opposite party:

Ext. B1: Copy of the Individual Health Insurance Policy No.

100505/48/2007/97/00002034.

By Order,

Senior Superintendent

Received on / Despatched on

amp/ 5 cs.