DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

BATHINDA

C.C. No. 319 of 05-08-2013

Decided on : 12-12-2013

1. Abbot Arora, aged about 34 years S/o Daulat Ram

2. Asha Rani Arora, aged about 57 years W/o Daulat Ram, R/o H. No. 126, Street No. 2. Aman Nagar, Malout.

   …...Complainants

Versus

1. ICICI Lombard General Insurance Co. Ltd., Sharma Complex, Ist Floor, Guru Kashi Marg, Corner Power House Road, Bathinda, through its Branch Manager

2. ICICI Bank Ltd., 4451, Bank Street, Bathinda, through its Branch Manager

    

.......Opposite parties

Complaint under Section 12 of the Consumer Protection Act, 1986.

QUORUM

Smt. Vikramjit Kaur Soni, President

Sh. Amarjeet Paul, Member

Smt.Sukhwinder Kaur, Member

For the Complainant : Sh. Naresh Garg, counsel for the complainant.

For the opposite parties : Sh. Vinod Garg, counsel for opposite party No. 1.

Sh. Sanjay Goyal, counsel for opposite party No. 2.

O R D E R

VIKRAMJIT KAUR SONI, PRESIDENT

1. The instant complaint has been filed by the complainants under section 12 of the Consumer Protection Act, 1986 as amended upto date (here-in-after referred to as an 'Act'). Briefly stated the case of the complainants is that complainants alongwith their family i.e. wife of Abbot and Daulat Ram father of Abbot applied for home loan with opposite party No. 2 at Bathinda for the purchase of one flat at Mohali in September, 2012. The opposite party No. 2 sanctioned home loan account No. NHMLT00000809642 with the condition that all the installments will be deducted from the account of Asha Rani on the first day of every month. The opposite party No. 2 before sanctioning the home loan to the tune of Rs. 22,90,000/- imposed one condition that the mandatory insurance of the loanee and the property has to be purchased from them. The opposite party No. 2 conveyed to the complainants that as per guidelines of the RBI, it is mandatory for every banker to insure the borrower and property so that in case of any mis-happening, the loan amount is secured. The opposite party No. 2 again sanctioned the loan of Rs. 4,93,500/- on 28-11-2012 out of which Rs. 4,48,495/- paid to the builder from whom the flat was purchased by the complainants and balance amount of Rs. 45,000/- vide cheque No. 222698/- deducted by the opposite party No. 2 on 28-11-2012 as per their condition of insurance. The complainants alleged that the opposite party No. 2 purchased insurance policy from opposite party No. 1 with their own mind which starts from 26-12-2012 whereas the payment deducted from the account of the complainant on 28-11-2012. The opposite parties sent the insurance policy to the complainant No. 1 which contained only five papers which only covers the risk and major medical illness of complainant No. 1 and no other family member was insured under this insurance coverage. The opposite party No. 2 sanctioned the home loan for 15 years, but purchased the insurance only for five years for complainant No. 1 only against the amount of Rs. 45,000/-. The complainants alleged that their family members signed the blank forms individually for each person at the time of taking the loan, but till date no copy of proposal form was supplied to them. The opposite parties issued one policy bearing No. 4065/ICICI-HSP/2530591/00/000 w.e.f. 26-12-2012 to 27-12-2017 under which only complainant No. 1 Abbot Arora is insured for Rs. 11,28,870/- under coverage of Major Medical illness and procedures, personal accident and loss of job etc., and the property i.e. flat at Mohali was also insured under this package insurance for 5 years. The complainant No. 1 all of sudden had heart problem first time in his history after mid January, 2013 and he was immediately taken to Jindal Heart Institute and Infertility Centre, Bathinda, where his angiography and ballooning treatment was done. Thereafter in the month of April, 2013, the complainant No. 1 suffered some problem and he was immediately taken to the Fortis Hospital, Mohali on 3-4-2013 where he was admitted on the same day and discharge on 4-4-2013 after procedure of stent and angiography. The complainants alleged that it is also made clear by the Fortis Hospital that there is no past history of Abbot Arora regarding heart problem. The complainant No. 1 lodged the claim with the opposite parties and submitted all the papers of both the hospitals and demanded his claim of Rs. 11,28,870/- under coverage of major medical illness and procedure, but the opposite parties neither replied nor paid any single penny to the complainants rather the opposite parties are orally forcing the complainants to give the consent for 5,50,000/- only without assigning any reason against the claim of Rs. 11,28,870/-. The complainant No. 1 received a letter dated 17-7-2013 vide which the opposite parties have rejected his claim with new exclusion clause 2.1.4 although the said clause was never communicated to the complainants before 17-7-2013. The complainants alleged that the opposite parties have rejected the claim of complainant No. 1 under such illegal exclusion clause which is not the part of the contract but now the opposite parties have introduced the same with malafide intention just to grab his claim. Hence, the complainants have filed the present complaint seeking direction to the opposite parties to pay total claim amount of Rs. 11,28,870/- with interest alongwith compensation and cost.

2. The opposite party No. 1 filed its separate written statement and took legal objection that this Forum has no territorial jurisdiction as the complainants have taken loan on the property located at District Mohali and the insurance policy was issued at Mumbai. On merits, the opposite party No. 1 has pleaded that the policy No. 4065/ICICI-HSP/2530591/00/000 was purchased from the opposite party No. 2 in the name of complainant No. 1 only and the said policy is strictly as per the coverage of insured events provided in the policy subject to exclusions, exceptions and restrictions. The opposite party No. 1 has further pleaded that the complainant No. 1 was having history of AWMI (Anterior Wall Myocardial Infraction) since 19-1-2013 which is evident from Angiogram report, OT notes of Jindal Heart Institute dated 19-1-2013. The date of diagnosis of Anterior wall myocardial infraction of the complainant No. 1 insured falls within 90 days of the policy inception (policy start date 26-12-2012). As per above mentioned policy clause 2.1.4 and date of diagnosis of heart attack, claim was repudiated as insured event falls within 90 days from policy inception date and same is excluded from coverage under this policy. The opposite party No. 1 has denied that only five papers of insurance policy were sent to the complainants, rather the complete policy with complete terms and conditions including part-II and III of the schedule were sent to the complainant. The opposite party No. 1 has admitted that the complainant lodged claim with opposite parties. The opposite parties have pleaded that sum insured under the policy is Rs. 11,28,870/- . However, insurance claim, if found admissible, shall only be payable as per term 5 of part I of the schedule of the policy. In the present case, insurance claim of the complainant is not admissible or payable as per clause 2.1.4 (c) of the policy terms. The opposite party No. 1 has denied that the said clause was never intimated nor written in the insurance policy or communicated to the complainants.

3. The opposite party No. 2 in its separate written statement has pleaded that the complainant has concealed the material facts that he has purchased the insurance policy from ICICI Lombard and regarding making of payment of above said policy to ICICI Lombard. The opposite party No. 1 has further pleaded that it has no control over passing of any claim or regarding repudiation of any claim. The opposite party No. 2 has admitted the purchase of policy. The opposite party No. 2 has pleaded that complete policy alongwith terms and conditions including schedule were sent to the complainant and he has intentionally proved incomplete record. No claim was ever submitted with opposite party No. 2 nor opposite party No. 2 can pass or reject any claim.

4. Parties have led their evidence in support of their respective pleadings.

5. Arguments heard. Record alongwith written submissions submitted by the parties perused.

6. The submission of the learned counsel for the complainants is that the opposite party No. 2 while sanctioning the home loan to them, imposed one condition that the mandatory insurance of the loanee and the property has to be purchased from them. The opposite party No. 2 purchased insurance policy from opposite party No. 1 with their own mind which starts from 26-12-2012 whereas the payment of Rs. 45,000/- was deducted from the account of the complainant on 28-11-2012 on account of premium. The learned counsel for the complainants further submitted that the opposite party No. 2 clearly stated to the complainants that all the borrowers i.e. complainants and their family completely insured under the insurance which was purchased from their sister concern i.e. opposite party No. 1. The opposite parties sent the insurance policy to the complainant No. 1 and when the complainant No. 1 received the insurance policy it contained only five papers covering the risk and major medical illness of complainant No. 1 only. The learned counsel for the complainants further submitted that the opposite parties never issued any terms and conditions, nor any exclusion clause nor any terms and conditions got signed from the complainants or their family members whereas the opposite parties are duty bound to supply and get signed the terms and conditions from the insured. The complainant No. 1 is of 34 years young aged person and all of sudden he had heart problem first time in his history after mid January, 2013. He was taken to Jindal Heart Hospital where his angiography and ballooning treatment was done. Thereafter in the month of April, 2013, the complainant again suffered some heart problem and he was immediately taken to the Fortis Hospital, Mohali on 3-4-2013 where he was admitted on the same day and discharged on 4-4-2013 after procedure of stent and angiography. The complainant No. 1 filed claim with the opposite parties which was repudiated by them by taking shelter of exclusion clause 2.1.4 which was never communicated to the complainant.

7. The learned counsel for the opposite parties submitted that the complainant suffered anterior wall myocardial infarction within first 90 days of policy inception, hence the loss suffered by the complainant No. 1 fell under exclusion 2.1.4 applicable to Section 1 which categorically mentioned that the company shall not be liable to make any payment under this policy in connection with or in respect of any insured even as stated in Section, occurred or suffered before commencement of the period of insurance or arising within first 90 days of the commencement of period of insurance. The learned counsel for opposite party No. 1 submitted that complete terms and conditions including part II and III of the schedule were sent to the complainant as per certificates issued by Blue Dart Courier Company. After mid January 2013, the complainant suffered coronary artery disease with anterior wall myocardial infarction and admitted with Jindal Heart Institute on 19-1-2013 and got treatment for the same disease in April, 2013. So, the claim of the complainant was rightly repudiated as the exclusion clause was part of the contract.

8. These are admitted facts of the parties that the complaints obtained loan of Rs. 22,90,000/- from the opposite party No. 2 and opposite party No. 2 purchased insurance from opposite party No. 1, for complainant No. 1 and the flat in question for which complainants obtained loan. The complainant No. 1 was insured vide insurance policy Ex. C-3 bearing No. 4065/ICICI/HSP/2530591/00/000 for the period of five years i.e. w.e.f. 26-12-2012 to 25-12-2017. The complainant No. 1 suffered Anterior Wall Myocardial infarction and was admitted in Fortis, Mohali, wherein he was treated. The complainant No. 1 filed claim with the opposite parties which was repudiated by them on 17^th July, 2013 vide Ex. C-5 on the ground that the date of diagnosis of anterior wall myocardial infarction of insured falls within the first 90 days of the policy inception ( policy start dated 26-12-2012), hence the loss suffered by the complainant No. 1 falls under Exclusion 2.1.4 i.e. Exclusions applicable to Section 1 (Major medical illness & procedures) according to which :

1. 1. 100. The company shall not be liable to make any payment under this policy in connection with or in respect of any insured event, as stated in this section, occurred or suffered before the commencement of period of insurance or arising with the first 90 days of the commencement of the period of insurance.

9. Now the matter before this Forum is that as to whether the claim of the complainant No. 1 has rightly been repudiated by the opposite parties. The complainants have alleged that the complete policy alongwith terms and conditions and exclusions etc., were not supplied to them and only five papers were delivered to them. To rebut this version of the complainants, the opposite party No. 1 has placed on file Ex. OP-1/6 & Ex. OP-1/7 i.e. certificates issued by Blue Dart Courier and pleaded that complete policy with complete terms and conditions including schedules and exclusion clause etc., were sent to the complainants through Blue Dart Courier vide Doct. No. 46266474074 dated 9-1-2013 which was delivered to complainants on 12-1-2013 and received by Daulat Ram Arora, father of complainant No. 1. Admittedly the complainant No. 1 has received the said courier/parcel, but as per version of the complainant No. 1, he has received only five papers. A perusal of aforesaid documents produced on file by the parties reveals that no weight of the consignment has been mentioned on the said certificates of the courier whereas it is a routine practice that at the time of delivery of any parcel/consignment, the same is weighed to calculate its delivery charges and the weight is always mentioned on the receipt issued by courier after receiving the said parcel/consignment. Hence, this evidence of the opposite parties is of no help to them. Thus, the version of the complainant that they received only five papers of the policy in question and no terms and conditions and exclusions etc., have been supplied to them seems to be correct. In such circumstances, the complainants are not bound by such terms and conditions which were never supplied to them. The law has been settled by the Hon'ble Supreme Court in a number of judgements that when the Insurance Companies want to apply the exclusion clause to deny the insurance claim, they have to prove that the Exclusion Clause was duly communicated to the insured and it was duly signed by him. The reference can be made to the judgement reported as M/s. Modern Insulators Ltd., Vs. Oriental Insurance Co. Ltd., 2000(I) CPJ 1 (SC) where it has been held :-

    

“..9. In view of the above settled position of law, we are of the opinion that the view expressed by the National Commission is not correct. As the above terms and conditions of standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant, respondent cannot claim the benefit of the said exclusion clause. Therefore, the finding of the National Commission is untenable in law.”

The terms and conditions were never supplied and explained to the complainant as these are not signed by the complainant. The support can be sought by the law laid down by the Hon'ble State Commission, Chandigarh in the case titled New India Assurance Co. Ltd., & Anr. Vs Arun Kumar Mangal.2010(I) CPJ 189 wherein it has been held :-

“....Insurance – Mediclaim policy – Exclusionary clause, non communication of – Mediclaim policy taken by insured from appellants in sum of Rs. 2,00,000/- - Treatment for spondylitis taken by insured – claim repudiated – Deficiency in services alleged – Complaint allowed – Hence appeal – Contention, hospital from which treatment taken by complainant not registered with the local authorities – Hospital did not fulfil conditions as required under Section 2(1)(b)(i) of mediclaim policy – Contention rejected – Appellants' plea unreasonable, patient is first to get the treatment and not find out specifications of the hospital – Alleged terms and conditions of policy not communicated to insured – Repudiation of claim not justified – Deficiency in services proved.

Further, the support can be sought by the law laid down by the Hon'ble National Commission, New Delhi, in case titled Massina Cold Storage Ltd., Vs. National Insurance Co. Ltd., & Others 2003 (I) CPJ 64 (NC) wherein it has been held :-

“...(ii) Insurance - Deficiency in Service – Terms and conditions attached with policy issued after expiry of life of policy – Deficiency in service proved – Compensation granted.

Held : We also see that as per records, the Insurance policy and the terms and conditions attached with the policy, were issued after the expiry of the life of the policy – keeping the insured in dark all along about the terms of the contract which a policy is. This is a clear case of deficiency on the part of the opposite party for which a token compensation of Rs. 1.00 Lakh is awarded to the complainant payable by the opposite party to the complainant which shall be recovered after due inquiry by the opposite party from the officer(s) concerned for the grave lapse/deficiency in service.

The complaint is allowed in above terms with costs of Rs. 5,000/-.”

10. A perusal of file reveals that the opposite parties have placed on file the proposal form Ex. OP-1/8 which was got signed from the complainant No. 1, before issuance of the said policy. This document shows that nothing has been mentioned regarding exclusion clause etc., in this document meaning thereby that the complainant No. 1 was not made aware of the terms, conditions and exclusions of the policy under which he was insured. The opposite parties have placed on file schedule OP-1/11 to OP-1/13 and pleaded that these schedules are the part of the policy in question and have been supplied to the complainants alongwith policy. A perusal of these schedules/policy wording which contains terms, conditions and exclusions, reveals that on these schedules, number of policy is not written and in the absence of mention of any policy number, it cannot be said that the said terms, conditions and exclusions actually relate to the policy of complainant No. 1.

11. Thus, keeping in view the facts, circumstances and the evidence placed on file by the parties, this Forum is of the considered opinion that the opposite parties neither supplied any terms and conditions nor exclusion to the complainants. The opposite parties have produced on file proposal form, which shows that proposal form got signed from the complainants prior to the issuance of the policy, also not contains the terms,conditions and exclusions. The opposite parties have charged such a huge amount of Rs. 45,000/- from the complainants and issued policy without supplying terms, conditions and exclusions, to decide the claims of the loanee as per their convenience keeping in view the ground of claim. Such practice of the Insurance Companies is not only unfair but also injustice with the general public. Moreover, it is admitted fact that the disease/heart problem which the complainant No. 1 suffered was not pre-existing i.e. prior to the insurance in question. The complainant No. 1 is a young person of 34 years of age and there is no history of his any heart problem. Moreover it is matter of common knowledge that heart problem is suffered all of sudden. The Insurance Regulatory and Development Authority vide its Circular Ref. No. IRDA/HLTH/MISC/CIR/216/09/2011 dated 20-09-2011 issued special guidelines to the Insurance Companies in this context. The relevant portion of the said circular is reproduced here under :-

“...To All Life Insurers and non-life Insurers

Re : Delay in claim intimation/documents submission with respect to

i) All life insurance contracts and

ii) All Non-life individual and group insurance contracts

....The Insurer's decision to reject a claim shall be based on sound logic and valid grounds. It may be noted that such limitation clause does not work in isolation and is not absolute. One needs to see the merits and good spirit of the clause, without compromising on bad claims. Rejection of claims on purely technical grounds in a mechanical fashion will result in policyholders losing confidence in the insurance industry, giving rise to excessive litigation.”

12. The legal objection taken by the opposite party No. 1 that this Forum has no territorial jurisdiction is not tenable as in the document Ex. C-10 issued by opposite party No. 2 the base branch of the complainant has been mentioned at Bathinda only. In Ex. C-9 also, the complainants have been asked to contact Bathinda Branch of ICICI Home Finance in case of any query.

13. The complainant No. 1 has been insured vide Ex. OP-1/9 for Rs. 11,28,870/- for Major Medical Illness & Procedure i.e. c) Occurrence of the following Medical Events :

: Stroke, Paralysis and Myocardial infarction

Hence, the complainants are entitled to the claim amount of Rs. 11,28,870/- and there is deficiency in service on the part of the opposite parties in repudiating the claim of the complainants.

14. With utmost regard and humility to the authorities cited by the learned counsel for the opposite parties, they are distinguishable on facts.

15. In view of what has been discussed above, this complaint is accepted with compensation and cost of Rs. 25,000/- against the opposite parties. The opposite parties are directed to adjust the amount of claim of Rs. 11,28,870/- alongwith interest @ 9% P.A. from the date of repudiation i.e. 17-07-2013 till adjustment, against the loan account of complainants bearing account No. NHMLT00000809642.

16. The compliance of this order be made within 45 days from the date of receipt of copy of this order.

17. A copy of this order be sent to the parties concerned, free of costs and the file be consigned to the record.

Pronounced in open Forum

12-12-2013

(Vikramjit Kaur Soni)

President

(Amarjeet Paul)

Member

(Sukhwinder Kaur)

Member