Delhi

New Delhi

CC/196/2009

Gurjot Singh - Complainant(s)

Versus

M/S. Royal Sundaram Alliance Insurance Company Ltd. - Opp.Party(s)

27 May 2015

ORDER

CONSUMER DISPUTES REDRESSAL FORUM-VI

(DISTT. NEW DELHI), ‘M’ BLOCK, 1^STFLOOR,

VIKAS BHAWAN, I.P.ESTATE,

NEW DELHI-110002.

 

Case No.TC/196/09                                                                                                                                                                                Dated:

In the matter of:

Sh. Gurjot Singh

R/o Flat no.021, Mahagun Maestro,

Plot f, 21 A Sector - 50,

Noida-201301 (presently in Delhi)

         ……..COMPLAINANT

 

VERSUS

1. M/s. Royal Sundaram Alliance Insurance Co. Ltd., 1505-1506, AmbaDeep Building

        (15^th floor), 14, K.G Marg, New Delhi-110001.

Also at:

        Regd. Office no.21

        Patullos road, Chennai – 600002

 

2. M/s. American Express Bank Ltd.

        Post Bag no.342, Connaught Place,

        New Delhi-110001

………. OPPOSITE PARTIES

 

ORDER 

President:  C.K. Chaturvedi

The short facts in the complaint are that complainant had been given a medi-claim Insurance of Policy of OP-1 on the credit and debit cards of OP-2, the American Express Bank.  The policy taken in 2003, covered him & his wife and parents for initial sum of Rs. 3 lacs each.  The existing diseases were excluded for first 5 years of policy.  The policy was auto renewal, which used to be charged on credit card No.3769-166584031005, which was also linked to complainant charge card No.3769-166584-31005.  The policy came to be renewed from time to time and when it reached 5^th year of renewal, the OP-2 declined to pay the premium to OP-1, for renewal despite credit balance on his card and also did not share this decline with complainant.  The OP-1 Insurance Company informed the complainant about decline of renewal by OP-2.  The complainant contacted both OP-1 & OP-2 and he was advised to send a cheque for renewal premium, after lot of harassment.

The complainant was shocked when he received the policy of Rs.11 lacs which was a new policy with different policy no. and not a renewed policy.  It is stated that by 5^th year the policy earned total of Rs.7,05,000/- as no claim bonus and his own insured amount stood at Rs.5,25,000/- and by unfair trade practice OP-1 issued a new policy no. on renewal.

It is alleged that in the meantime, at the age of 34, the complainant was diagnosed with coronary angioplasty disease as Triple Vessel Disease, and was admitted in Escorts Heart Institute & Research Centre on 26.9.07.  After undergoing surgery he dispatched the duly filled on 2.10.07, after discharging from hospital vide Ext PW1/16 Mark ‘A’.

The OP-1 by its letter dated 12.11.07 Ext.PW1/17 declined to honor the request for reimbursement of Rs.7.7lacs on the ground that it was a new policy and did not cover heart disease for first year of policy.  Thereafter, this complaint of deficiency against both OP-1 & OP-2 was filed.

 The OP-1 & OP-2 filed separate reply, the OP-1 has admitted issue of policy on the basis of cheques given by complainant which after talking with OP-1 & OP-2, he was asked to send direct cheque premium on decline of premium payment by OP-2. 

The OP-1 has taken the plea that the claim petition was filed after 1year and thereafter was time barred and clause of policy shows it be filed within a 90 days of treatment, failing which the claim is deemed abandoned.  It also took plea that disease was not covered in the 1st year of policy and this was a new policy. The OP-2 stated that due to bad payment record the payment was declined.  There is no evidence produced to that effect.  The complainant in rejoinder and even in complaint has alleged collusion between OP-1 & OP-2 and unfair trade practices of OP-1 & OP-2 to get policy lapsed in 5^th year at the time of renewal, so that disease are never covered, despite the policy being existing for no. of years, as claim in the new policy are excluded.

We have considered the rival case closely, perused the complaint along with exhibits filed by complainant, and consider the submission and case law cited by complainant and OPs and written submissions placed on record.

We are, to say the least, shocked by the brazen collusion of OP-1 & OP-2, in defeating the renewal in 5^th year.  The evidence of complainant read with its correspondence clearly shows that, the policy was in auto renewal mode and came to be renewed every year and only in the 5^th year, the OP-2 attempted to precipitate a lapse by not paying the premium, without knowledge of complainant or notice to him; nor explaining the reason for this, assuming that he had bad record.  The OP-2 has produced no record of intimation of bad record.    Somehow, he came to know from OP-1 of not paying and on interacting with OP-1 & OP-2 he sent a cheque for premium, and the renewal was on the accumulated no-claim bonus and increased sum of each beneficiary which was touching 11 lakhs, together. The OP-1 in a peculiar manner issued a new policy for Rs.11 lakhs based on the sum earned in the each policy earlier.

The practice of insuring a new number and new policy is with only a view to help defeat the claim on pre-existing diseases qualifying for coverage after 5^th year.  Such a nefarious and mischievous practice followed by OP-1 in collusion of OP-2, which promoted policy of OP-1 at its hands, for consideration or arrangement of consideration or arrangement of commission inter se is clearly exposed in this case.  The Hon’ble Supreme Court in the case of Biman Krishna Bose Vs. United India Insurance Co. Ltd.-(2001) 6 SCC 477 and Gujarat High Court in case of United India Insurance Co. Ltd. VS. Mohanlal Aggarwal, - 2004 ACJ 1657, exposed and condemned practice by insurance companies in defeating just claims, to make willful gain by depriving innocent consumers.  The OP-1 is firstly pleading limit of 90  days for making claim, though such clauses are void u/s. 28 of the Contract Act, 1872 (as amended) and beautifully  demonstrated by complainant’s counsel in written submissions.  The claim is also not time barred under Consumer Protection Act, 1986 and is wrongly so pleaded by OP-1.

We hold both OP-1 & OP-2 grossly guilty of indulging in unfair trade practice, to sell the policy, without intending to honor it. The OP2 made old policy sum as new policy sums by issuing a fresh policy no., disconnecting with old policies in last 4 years.

In these circumstances, we hold that the policy issued on getting renewal premium based on earlier policy is renewal policy and since 2003, which even if is described as new policy, by OP-1.  The same has been done mischievously to defeat Benefits occurring after 5^th year of renewal. 

Thus, we direct OP-1 to pay Rs.7.7 lakhs along with interest of 9 % on this from the 90^TH days of date of claim till payment, for the treatment in Escort Heart Hospital and we award a compensation of Rs.1 lakhs to be paid by OP-1 and as punitive for issuing of new policy and compensation deficiency and litigation expenses to the complainant.

The order shall be complied with within 30 days of the receipt of the copy of the order; otherwise action can be taken under Section 25 / 27 of the Consumer Protection Act.

File be consigned to record room.

Copy of the order be sent to the parties free of cost.

 

        Pronounced in open Court on 27.05.2015.

 

 

(C.K.CHATURVEDI)

PRESIDENT

 

 

(S.R. CHAUDHARY)                 (RITU GARODIA)

MEMBER                          MEMBER