BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-I, U.T. CHANDIGARH

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Shri Pawan Taneja, aged about 36 years, s/o Shri RS Taneja, r/o Flat No.304, B-Block, 3^rd Floor, Rail Vihar, Sector 4, Mansa Devi Complex, Panchkula, Haryana.

….…Complainant

                            V E R S U S

1.  Iffco-Tokio General Insurance Company Limited, through its Managing Director and Chief Executive Officer, Corporate Office, Iffco Tower, 4^th & 5^th Floors, Plot No.3, Sector 29, Gurgaon 122001, Haryana.

2.  Iffco-Tokio General Insurance Company Limited, through its Branch Manager, Plot No.2B-C, 4^th Floor, Iffco Complex, Sector 28-A, Madhya Marg, Chandigarh UT 160018.

3.  The Oriental Insurance Company Limited, through its Chairman cum Managing Director, Registered Office : Oriental House, A-25/27, Asaf Ali, Road, New Delhi 110002.

4.  Paramount Health Services (TPA) Private Limited, through its Regional Manager, Regional Office : D-39, Okhla Industrial Area, Phase I, Near DD Motors, New Delhi 110020.

..…Opposite Parties

CORAM:        SH.RAJINDER SINGH GILL, PRESIDING MEMBER

              MRS. MADHU MUTNEJA, MEMBER

Argued by:       Sh. Neeraj Pal Sharma, Adv. for complainant.

Sh. Rajneesh Malhotra, Adv. for OPs 1 & 2

Sh. Vinod Chaudhri, Adv. for OP-3

OP-4 exparte.

PER MRS. MADHU MUTNEJA, MEMBER

             The instant complaint has been filed by Shri Pawan Taneja (complainant) against the OPs for non payment of the medi-claim.

1.              Briefly stated, the complainant was an employee of OP-1 in the capacity of Manager w.e.f. 19.4.2004. The complainant was offered a critical medical insurance policy by OPs 1 & 2 for the medical insurance of his family including parents in May 2004. This policy was part of a group insurance for all employees of OP-1 & 2.  OP-3 is a General Insurance Company which had issued the medi-claim policy to OP-1 for coverage of its employees.  Regular premium for the medical insurance policy was being paid to OP-3 by OP-1 by direct deduction from the salaries of the employees. The complainant had paid Rs.22,615/- + taxes as premium per annum.

              Rs.27,138/- + taxes had been deducted by OP-1 from the salary of the complainant for the year 2009-10 for coverage of both the parents of the complainant. It is pertinent to mention here that the complainant had been paying regular premiums for the policy from the year 2004 onwards and the premium had been paid upto 23.5.2010.  

              The complainant resigned from the service of OPs 1 & 2 on 22.9.2009. When he was relieved from the job the OPs did not raise any concern/caveat qua the continuation of the medi-claim insurance policy nor was any notice/cancellation of the same done by either of the parties.  No premium on pari passu  was at that time refunded to the complainant. 

              Subsequently, the mother of the complainant was admitted to Sir Ganga Ram Hospital on 12.10.2009 for surgery.  In accordance with the terms and conditions of the policy, cashless treatment was to be given to the patient.  The complainant in accordance with these terms filled in the admission note and sent the same to OP-4 for approval.  However, he was surprised to see that the cashless facility was denied to him.  On enquiry he was informed by OPs 1 & 2 that the benefits under the medi claim policy were available only to serving employees and the denial has been thus occasioned.  The complainant thus paid Rs.1,62,462/- from his own pocket for the treatment of his mother and, thereafter, issued a legal notice to OPs 2 to 4 through registered post with a demand for payment.  OP-2 vide letter dated 10.11.2009 informed that the denial was in accordance with the terms of the policy since he had resigned from the job and the coverage could not be extended beyond the date of resignation.

              Thereafter OP-1 forwarded a cheque of Rs.19,682/-, dated 17.12.2009 to the complainant as refund of premium on pari-passu basis.  The complainant never got this cheque encashed.

              The mother of the complainant was once again taken to the Sir Ganga Ram Hospital for knee replacement. This time the total treatment cost was Rs.4,13,055/-. This amount was also paid by the complainant from his own sources.  The OPs again never paid this amount.

              The complainant has thus filed the instant complaint alleging deficiency in service and unfair trade practice against the OPs on the following grounds :-

a)        OP-3 after receiving the full annual premium from the complainant through OPs 1 & 2 had not honoured its commitment for the medi claim against the bills for the two hospital treatments mentioned.

b)        The OPs could not cancel the policy of their own account. 

c)        OP-4 after taking all claim documents from the complainant denied the claim.

d)        OPs were under a solemn duty to ensure that the policy was cancelled and premium refunded to the complainant within a reasonable time.  The OPs should not have waited for the accrual of claim and then cancelled the policy and refunded the premium.

       The complainant has thus prayed that the OPs be directed to make payment of Rs.32,462/- against his first claim of Rs.1,62,462/- (Rs.1,30,000/- had been allowed by United India Insurance Company being insurer of the wife of the complainant) and Rs.1,13,055/- against the second claim of Rs.4,13,055/- (as Rs.3 lacs had been allowed by Apollo DKV Insurance Company being the insurer of the complainant) alongwith compensation and litigation costs.

2.              OPs 1 & 2 in their reply have submitted that the Medi Claim Group Insurance Policy is only valid for an employee of the company during the period the employee is in service of the company.  The cover comes to an end as and when the employee leaves the service of the company.  The premium paid for the full year had already been refunded on pro rata basis to the complainant for the period after the date of resignation till the end of policy period i.e. from 22.9.2009 to 23.5.2010. It has been alleged that the complainant should have got the policy cancelled when he left the job.  The claim is being sought for a period when the group insurance policy stopped being effective for the complainant and his beneficiaries after he resigned from the company on 22.9.2009. Since the complainant had himself resigned from the post on 22.9.2009, the cover for insurance did not extend to him and his family, hence the medi claim could not be paid to him.  The OPs have thus prayed for dismissal of the complaint. 

3.              OP-3 in their separate written reply have taken almost similar pleas as taken by OPs 1 & 2 in their written reply.   As the name suggests in clear terms, the insurance cover relates to a group insurance and cannot be extended to a person who is not part of the group i.e. left the service.  Hence after his resignation, the complainant automatically forfeited his claim for indemnification after the date of resignation/leaving the group. They have also accordingly prayed for dismissal of the complaint. 

4.              OP-4 did not appear despite due service, hence it was proceeded against exparte. 

5.              All parties led evidence in support of their contentions.

6.              We have heard the ld. counsel for the contesting parties and have also perused the record including the written arguments. 

7.              A perusal of the medi-claim insurance policy shows that the policy was extended to all the employees of the OPs.  The insured person is a person mentioned in the schedule.  But surprisingly the schedule has not been attached either by the complainant or the OPs along with the documents presented to this Forum.  From the policy agreement, it is clear that the insured person is a person who has paid premium to the company as consideration for the insurance. The complainant having paid the premium is covered by the policy as per this term and comes under the meaning of insured. 

8.              Further clause 5.11 of the policy which relates to cancellation reads as under :-

              “5.11 CANCELLATION CLAUSE company may at any time without assigning any reason cancel this policy by sending the insured 30 days notice by registered letter at the Insured’s last known address and in such an event the Company shall refund to the Insured a pro-rata premium for un-expired period of Insurance.  The Company shall, however, remain liable for any claim which arose prior to the date of cancellation.  The Insured may at any time cancel this policy and in such event the Company shall allow refund of premium at Company’s short period rate only (table given here below) provided no claim has occurred during the policy period upto date of cancellation.”

9.           As per this clause, it is obviously clear that the company would remain liable for any claim which arose prior to the date of cancellation of policy.  The OPs have cancelled the policy vide email dated 17.12.2009 and cheque of even date amounting to Rs.19,682/- was refunded on pari passu basis to the complainant.  The instant case relates to two amounts being claimed by the complainant. The first amount is Rs.32,462/- against Rs.162,462/- spent on 23.10.2009 and the second amount is Rs.1,13,055/- against Rs.4,13,055/- spent on 24.2.2010.  If the contention of the OPs is accepted then as per clause 5.11 of the contract they are definitely liable to make payment of Rs.32,462/- since this amount has been paid by the complainant for the medical treatment before the cancellation of the policy.  The second amount has been spent after the OPs sent the cancellation letter to the complainant alongwith refund amount.  This amount has not yet been encashed by the complainant.  It is obvious that he must have thought that the policy would continue for the whole year if he would not accept the refund, but this refusal cannot be accepted by this Forum as a reason for continuation of the policy.  If we consider clause 5.11, then the OPs would not be liable to pay the claim against the second hospitalization treatment.

10.          In view of the above findings, we deem it proper to take the righteous decision and partly allowed the complaint in favour of the complainant  with the following directions:-

i)         All OPs would be jointly & severally liable to pay Rs.32,462/- to the complainant against the medi-claim before the cancellation of the policy.

ii)       The OPs shall also pay Rs.10,000/- to the complainant towards compensation besides Rs.5000/- cost of litigation.

              This order shall be complied with within 30 days from the date of its receipt, failing which the OPs would be liable to pay aforesaid amount of Rs.42,462/- with interest @12% per annum from the date of order till its actual payment to the complainant, besides cost of litigation.  However, the complainant will return the cheque of Rs.19,682/- to the OPs which had been sent by them as refund on pari-pasu basis from the date the complainant left the job. They will give a fresh cheque of the accordingly reduced amount from the date of cancellation of the policy till 23.5.2010.

11.          It needs to be added here that the OPs would not be liable for payment of Rs.1,13,055/- against the medi-claim for the second hospitalization after the cancellation of the policy by the OPs.

              Certified copies of this order be sent to the parties free of charge.  The file be consigned.