Order by:

Sh.Amrinder Singh Sidhu, President

1.       The   complainant has filed the instant complaint under section 12 of  the Consumer Protection Act, 1986 (as amended upto date) on the allegations that that the complainant  has been purchasing the medical insurance policy for his entire family members from the year 2003 without any break and as such, paid hefty amount with the Opposite Parties on account of premium and during the period of last policies, the complainant never claimed even for a single time, but from time to time, with No Claim Bonus and as per the choice of the complainant, the policy enhanced from Rs.1,50,000/- to Rs.5,00,000/- lakhs and last policy bearing No.401700/81/17/10000460 was purchased by the complainant on 09.03.2018 against the paid up premium of Rs.21,647/-, the detail of the last policy period and its description has been fully mentioned in para No.2 of the complainant itself.  Further alleges that in the month of July, 2018 the complainant suffered a severe paid in his back bone (Spinal cord) and the doctors referred him to Orison Super Speciality Hospital Infertility and Trauma Centre, Ludhiana, where the treating doctor opined that back pain radiating to both lower limbs and in this paid, the only solution is to give the injection immediately, and they injected the same and after 2 or 3 hours, the complainant felt relax and discharged from the hospital and the treating doctor charges Rs.17,985/-. Again in the month of October, 2018, the complainant got himself checked up and the treating doctor gave same treatment and injected the injection and charged Rs.9395/- and in this way, the complainant paid Rs.27,380/- for two times  treatment.  After that, the complainant lodged the claim for the reimbursement of his claim with the Opposite Parties, but the Opposite Parties on the opinion of TPA, has  repudiated the claim of the complainant vide letter dated 05.12.2018 under the vague reason that the complainant has not since been remained (admitted) in the hospital minimum 24 hours under the norms of the insurance company. However, this very alleged clause never disclosed to the complainant by the Opposite Parties.  As such, the alleged  terms and conditions, particularly the exclusion clause of the policy in question is not binding upon the insured. It is further respectfully submitted that admittedly, the complainant has been regularly obtaining the health insurance cover w.e.f. 2003 till date, which is obvious for the complainant to claim for sum assured in case of reimbursement of medical expenses incurred by him and there is no dispute inter se parties regarding the expenses incurred by the complainant on the treatment for which the complainant has also produced on record. In view of this, there is deficiency in service on the part of the Opposite Parties and they have illegally repudiated the genuine and legal claim of the complainant taking the false and frivolous ground on the report of third party agent. The complainant approached the Opposite Parties time and again for the reimbursement of his  genuine remaining medical claim, but  the Opposite Parties  flatly refused to reimburse the total claim of the complainant, as such, there is deficiency in service on the part of the Opposite Parties. Vide instant complaint, the complainant has sought the following reliefs.

a)       The Opposite Parties may be directed to reimburse the remaining medical claim of the complainant amounting to Rs.27,380/-  alongwith Rs. 2 lakhs on account of compensation due to mental tension and harassment caused by the complainant and Rs.7500/- as costs of complaint.

2.       Opposite Parties appeared through counsel and contested the complaint by filing  the written version taking preliminary objections therein inter alia that the complainant has approached the Opposite Parties for the reimbursement of medical treatment expenses and the matter was referred to TPA M/s.Medi Assist India, but vide letter dated 19.01.2019, as per the opinion of TPA, the claim of the complainant was repudiated as per  clause 2 and 3.11 of  the terms and conditions of the policy on the ground that expenses on hospitalisation for a minimum period of 24 hours are admissible, but the complainant  remained admitted in the hospital less than 24 hours regularly. In this regard, a registered letter dated 07.03.2019 was issued to the complainant in which it has been mentioned that that vide registered letter dated 31.01.2019 TPA requires indoor case papers for confirming the admissibility as per treatment of complainant for Orison Super Speciality Hospital and Infertility & Trauma Center, Ludhiana  w.e.f 02.10.2018 to 03.10.2018 during which period the complainant alleged that he remained in the hospital as indoor patient.  The papers/ documents have been sought by TPA on the ground that the treatment given by said hospital is not required to remain admitted in the hospital for more than 2-3 hours and hence, the TPA come to the conclusion that the case is not covered under terms and conditions of the policy as detailed above and hence, there is no deficiency in service on the part of the Opposite Parties.   On merits, the Opposite Parties took up the same and similar pleas as taken up by them in the preliminary objections.   Hence, the Opposite Parties has rightly repudiated the claim of the complainant after application of mind and the complaint may be dismissed with costs.    

3.       In order to  prove  his  case, the complainant has tendered into evidence his affidavit Ex.CW1/A alongwith copies of documents  Ex.C1 to Ex.C29 and  closed the evidence on behalf of the complainant.

4.       On the other hand,  to rebut the evidence of the complainant,  Opposite Parties also tendered into evidence the affidavit of  Sh.Tirath Ram Ex.Ops1 alongwith copies of documents Ex.Ops2 to Ex.Ops23 and closed the evidence.

5.       We have heard the ld.counsel for the parties and also  gone through the documents placed  on record.

6.       Ld.counsel for the Complainant has  mainly reiterated the facts as narrated in the complaint and contended that first of all, the written version  filed on behalf of the Opposite Party has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. Opposite Party is limited Company and written version has been filed on the basis of special power of attorney given to ld.counsel for the Opposite Party. Further contended that at the time of issuance of the said policy  to the complainant, no term and conditions were ever explained or supplied by Opposite Parties to the complainant. Further contended that  the complainant  has been purchasing the medical insurance policy for his entire family members from the year 2003 without any break and as such, paid hefty amount with the Opposite Parties on account of premium and during the period of last policies, the complainant never claimed even for a single time, but from time to time, with No Claim Bonus and as per the choice of the complainant, the policy enhanced from Rs.1,50,000/- to Rs.5,00,000/- lakhs and last policy bearing No.401700/81/17/10000460 was purchased by the complainant on 09.03.2018 against the paid up premium of Rs.21,647/-, the detail of the last policy period and its description has been fully mentioned in para No.2 of the complainant itself.  Further alleges that in the month of July, 2018 the complainant suffered a severe paid in his back bone (Spinal cord) and the doctors referred him to Orison Super Speciality Hospital Infertility and Trauma Centre, Ludhiana, where the treating doctor opined that back pain radiating to both lower limbs and in this paid, the only solution is to give the injection immediately, and they injected the same and after 2 or 3 hours, the complainant felt relax and discharged from the hospital and the treating doctor charges Rs.17,985/-. Again in the month of October, 2018, the complainant got himself checked up and the treating doctor gave same treatment and injected the injection and charged Rs.9395/- and in this way, the complainant paid Rs.27,380/- for two times  treatment.    After that, the complainant lodged the claim for the reimbursement of his claim with the Opposite Parties, but the Opposite Parties on the opinion of TPA, has  repudiated the claim of the complainant vide letter dated 05.12.2018 under the vague reason. Further contended that  alleged TPA is legally not competent to decide the claim of the complainant as there is no contract of the complainant with said TPA. It is settled law that TPA who is yes-man of the Opposite Parties  has no legal right to decide the fate of the claim of the complainant  and hence the ground for the repudiation of the claim of the complainant is quite illegal and false one.

7.       On the other hand, ld.counsel for the Opposite Party has repelled the aforesaid contention of the ld.counsel for the complainant on the ground that the complainant has approached the Opposite Parties for the reimbursement of medical treatment expenses and the matter was referred to TPA M/s.Medi Assist India, but vide letter dated 19.01.2019, as per the opinion of TPA, the claim of the complainant was repudiated as per  clause 2 and 3.11 of  the terms and conditions of the policy on the ground that expenses on hospitalisation for a minimum period of 24 hours are admissible, but the complainant  remained admitted in the hospital less than 24 hours regularly. In this regard, a registered letter dated 07.03.2019 was issued to the complainant in which it has been mentioned that that vide registered letter dated 31.01.2019 TPA requires indoor case papers for confirming the admissibility as per treatment of complainant for Orison Super Speciality Hospital and Infertility & Trauma Center, Ludhiana  w.e.f 02.10.2018 to 03.10.2018 during which period the complainant alleged that he remained in the hospital as indoor patient.  The papers/ documents have been sought by TPA on the ground that the treatment given by said hospital is not required to remain admitted in the hospital for more than 2-3 hours and hence, the TPA come to the conclusion that the case is not covered under terms and conditions of the policy as detailed above and hence, there is no deficiency in service on the part of the Opposite Parties.

8.       Perusal of the contention of the ld.counsel for the complainant   shows  that  the written version  filed on behalf of Opposite Party has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. The Opposite Party  is limited Company and written version has been filed on the basis of special power of attorney given  to ld.counsel for the Opposite Party.  In this regard, Hon’ble Supreme Court of India in case titled as Shubh  Shanti  Services  Limited  v.  Manjula S.Agarwalla and others (2005) 5 SCC 30, decided on 11.05.2005 has  and observed to the following effect:

 “..............As already stated, it has not been  averred in the plaint nor sought to be proved that  any resolution had been passed by the Board of  Directors  of  the  plaintiff  company  authorising  Shri A.K. Shukla to sign, verify and institute the  suit.   It  has  also  not  been  averred  that  the  memorandum/articles of the plaintiff company give ny right to Shri A.K. Shukla to sign, verify and  institute  a  suit  on  behalf  of  the  plaintiff  company.  It, therefore, follows that the plaint  has been instituted by Shri A.K. Shukla only on  the  authority  of  Sh.  Raj  K.Shukla,  CEO  of  the  plaintiff  company.   Such  an  authority  is  not  recognized under law and, therefore, I held that  the  plaint  has  not  been  instituted  by  an  authorised  person.   Issue  No.1  is  accordingly,  decided against the plaintiff and in favour of the  defendants.”

Further,  Hon’ble Supreme Court of India in a judgment (2011)II Supreme Court Cases 524 titled as “State Bank of Travancore Vs. Kingston Computers India Pvt. Ltd.” and in para no.11 of the judgment,  has held that

“the plaint was not instituted by an authorized person. On the plea that one authority letter dated 02.01.2003 was issued by Sh. R.K.Shukla in favour of Sh. A.K.Shukla. Further plaint failed to place on record its memorandum/articles to show that Sh. R.k.Shukla has been vested with the powers or had been given a general power of attorney on behalf of the Company to sign, verify and institute the suit on behalf of the Company.”

Recently Hon’ble State Consumer Disputes Redressal Commission, Punjab at  Chandigarh in FAO No.1235 of 2015 decided on 25.01.2017 in case titled as L.G.Electronics India Private Limited Vs. Sita Ram Chaudhary also held that the plaint instituted by  an unauthorized person has no legal effect.

9.       For the sake of arguments, for the time being, if the written reply filed by Opposite Party is presumed to be correct, the next  plea  raised by Opposite Party  is that the complainant has violated the terms and conditions of the policy in question and as per the terms and conditions of the policy, the complainant is not entitled to the claim as claimed.  But the Opposite Party could not produce  any evidence to prove that terms and conditions of the policy were ever supplied to  the complainant insured, when and through which mode? It has been held by Hon’ble National Commission, New Delhi in case titled as The Oriental Insurance Company Limited Vs. Satpal Singh & Others 2014(2) CLT page 305 that the insured is not bound by the terms and conditions of the insurance policy unless it is proved that policy was supplied to the insured by the insurance company. Onus to prove that terms and conditions of the policy were supplied to the insured lies upon the insurance company. From the perusal of the entire evidence produced on record by the Opposite Party,  it is clear that Opposite Party  has failed to prove on record that they did supply the terms and conditions of the policy to  the complainant insured. As such, these terms and conditions, particularly the exclusion clause of the policy is not binding upon the insured. Reliance in this connection can be had on Modern Insulators Ltd.Vs. Oriental Insurance Company Limited (2000) 2 SCC 734, wherein it is held that “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 the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant, the respondent can not claim the benefit of the said exclusion clause. Therefore, the finding of the National Commission is untenable in law.”  Our own Hon’ble State Commission, Punjab, Chandigarh in First Appeal No.871 of 2014 decided on 03.02.2017 in case titled as Veena Mahajan (Widow) and others Vs. Aegon Religare Life Insurance Company Limited in para No.5 has held that

“Counsel for the appellant argued that copy of insurance policy was not supplied to the appellant and hence, the exclusion clause in the contract of the insurance policy is not binding upon him. He further argued that no proof of sending of insurance policy was ever produced by the respondent despite specific contention raised by the complainant that the insurance policy was never received by him. He argued that though there is an averment of the OP that the policy in question was delivered through Blue Dart Courier to the complainant. In order to prove their contention, no affidavit of any employee of Blue Dart was produced who would have made a statement to have the effect that the policy was delivered to the complainant nor any acknowledgement slip for having received the article by the complainant through courier company was produced by the insurance company. He argued that since no policy document was received by the insured and argued that the terms and conditions as alleged to be part of the insurance policy were not binding upon the insured. He argued that policy was issued in the name of deceased Sh.Vijinder Pal Mahajan with his wife Mrs.Veena Mahajan as beneficiary and the same was never refused by the OP and the proper premium for insurance was paid by late complainant. He argued that as per the specific allegations made in the complaint in para No.4, no rebuttal to that contention was specifically there in their written reply in para No.2 and para No.4 in the reply filed by OP in the District Forum. He argued that Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case of "Ashok Sharma Vs. National Insurance Co. Limited", in Revision Petition No. 2708 of 2013 held in para No.8 to the point of non-delivery of terms and conditions of the policy. He also cited Hon'ble Supreme Court's decision given in the matter of "United India Insurance Co. Limited Vs. M.K.J.Corporation" in Appeal (civil) 6075-6076 of 1995 (1996) 6 SCC 428 wherein the Apex court held that a fundamental principle of Insurance Law makes it that utmost good faith must be observed by the contracting parties. Good faith forbids either party from concealing what he privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. Just as the insured has a duty to disclose, "similarly, it is the duty of the insurers and their agents to disclose all material facts within their knowledge, since obligation of good faith applies to them equally with the assured and further argued that since the terms and conditions were not supplied even on repeated requests the same cannot be relied upon by the opposite party in order to report to repudiate the genuine claim of the wife of the deceased policy holder.”

10.     It is not denial of the case that during the policy period the complainant took treatment two times  from  Orison Super Speciality Hospital Infertility and Trauma Centre, Ludhiana, where the treating doctor charged Rs.27,380/- for two times  treatment  from the complainant.  But as per the version of the Opposite Parties that   the matter was referred to TPA M/s.Medi Assist India, but vide letter dated 19.01.2019, as per the opinion of TPA, the claim of the complainant was repudiated as per  clause 2 and 3.11 of  the terms and conditions of the policy on the ground that expenses on hospitalisation for a minimum period of 24 hours are admissible, but the complainant  remained admitted in the hospital less than 24 hours regularly. In this way, on the report of TPA M/s.Medi Assist India, the Opposite Parties have repudiated the claim of the complainant, but with said TPA M/s.Medi Assist India, the Complainant has no concern at all. In this regard, Hon’ble State Commission, Punjab, Chandigarh in First Appeal No.1105 of 2014 decided on 25-04-2017 in case titled as Sukhdev Singh Nagpal Vs. New Karian Pehalwal Cooperative Agriculture service Society & Others has held that TPAs have no authority to reject the claim- such power lies, exclusively with the Insurance Companies (Para No.25 to 27). The TPA can only process the claim and forward the same to the Insurance Company and the competent authority of the Insurance Company is to decide about the same. The claim of the complainant was illegally and arbitrarily rejected by the TPA, against the instructions of the IRDA. In view of this, the repudiation merely on the basis of report of the TPA is not legal.

11.     As held by  above in supra judgement of Hon’ble Supreme Court of India in Modern Insulators Ltd case that  that  the terms and conditions, particularly the exclusion clause of the policy is not binding upon the insured. But in the instant case as per Discharge Summary Ex.C2 and as per invoice Ex.C3, the complainant was discharged first only on 21 July, 2018 and then second time discharged on 03 October, 2018 as per Discharge Summary Ex.C15 and copy of invoice Ex.C16 and Ex.C17 and it is usual that once someone remained admitted, then he could be  discharged from the treating hospital and in the OPD, there may not be discharge record maintained with them if the treatment was taken by someone in OPD. But in the instant case, there is sufficient discharge record of the complainant insured maintained by the treating hospital as mentioned above and hence, the Opposite Parties can not be abstained from  their legal liability to make good the reimbursement of his treatment under the policy.  Not only this, the complainant has been purchasing the medical insurance policy for his entire family members from the year 2003 without any break and as such, paid hefty amount with the Opposite Parties on account of premium and during the period of last policies, the complainant never claimed even for a single time, but from time to time, with ‘No Claim Bonus’ and as per the choice of the complainant, the policy enhanced from Rs.1,50,000/- to Rs.5,00,000/- lakhs. As such, when the complainant is under the health insurance ever since the year 2002 till date, he need not to wait for uptil the year to seek the claim under the current insurance policy.  Moreover, the current insurance policy can not be treated to be a new policy.  Hon’ble State Commission, Punjab, Chandigarh in Consumer Complaint No.367 of 2016,  Date of institution : 25.11.2016, decided on 24.10.2017 titled as Ranjan Garg Vs.  Apollo Munich Health Insurance Co. Ltd., and another, has held to the following effect:-

“ It is otherwise the duty of the Insurance Company to verify the health status of an individual specifically when the Policy is continuing for the last many years i.e. ranging from 6 to 8 years and it was not a case that the policies were immediately taken. This is a common practice of the Insurance Companies to repudiate the claimon flimsy grounds without any justification.

It is also relevant to mention here that Section 19 of the General Insurance Business Nationalization Act, 1972 states that it shall be the duty of every Insurance Company to carry on general insurance business so as to develop it to the best advantage of the community. The denial of medical expenses reimbursement is utterly arbitrary on the ground that disease in question was excluded as per exclusion clause. It is mere an excuse to escape liability and is not bona fide intention of the insurance company. Fairness and nonarbitrariness are considered as two immutable pillars supporting the equity principle, an unshakable threshold of State and public behavior. The terms and conditions of any policy in the realm of insurance company should be informed, fairly and non-arbitrarily. When the insurance policy has exclusions/conditions to repudiate the claim or limit the liability, the same must be specifically brought to the notice of the insured and are required to be got signed to show that such exclusions and conditions have been brought to his/her notice.

The need for interpreting a contract always arises in two situations, (i) when a gap is needed to be filled in the contract and (ii) an ambiguity is needed to be resolved in the contract, then to find out correct intention of the contract, spirit behind it is required to be considered. Normally, the insurance policy is a contract of adhesion, in which other party is left with hardly any bargaining power as compared to the insurer. Insurance contracts are standard form contracts and are drafted by the insurance company and as such, insurance company is at higher footing than the insured. The benefit of such clause, as exclusion clause, would go to the insured, unless the same is explained in clear terms by the insurer. In such circumstances, the tribunal would be more oriented towards the interpretation, which goes against the party, who has inserted/drafted the disputed clause in the agreement/contract. The adjudicating authority is required to look into, whether the intention of the party is to exclude or limit liability has been appropriately explained to the other party or not. This Commission while interpreting insurance agreement is to honour the intention of the parties, who have signed the agreement. Even if the agreement had general exclusion/condition for misrepresentation still fraudulent misrepresentation and non-disclosure may not be there. The innocent and negligent misrepresentations are to be ignored.”

Hon’ble Supreme Court in case  “United India Insurance Co. Ltd. v. Manubhai Dharamsinhbhai Gajera and Ors.” AIR 2009 SUPREME COURT 446; has held in para no.64 as under:-

 “64. Each of the aforementioned cases clearly shows that the action on the part of the authorities of the appellant was highly arbitrary. Respondents though were not entitled to automatic renewal, but indisputably, they were entitled to be treated fairly. We have noticed hereinbefore some of the clauses contained in the prospectus as also the insurance policy. When a policy is cancelled, the conditions precedents therefore must be fulfilled. Some reasons therefore must be assigned. When an exclusion clause is resorted to, the terms thereof must be given effect to. What was necessary is a preexisting disease when the cover was inspected for the first time. Only because the insured had started suffering from a disease, the same would not mean that the said disease shall be excluded. If the insured had made some claim in each year, the insurance company should not refuse to renew insurance policies only for that reason. The words ‘incepts for the first time’ as contained in clause 4.1 as also the words ‘continuous and without break’ if the renewal premium is paid in time, must be kept in mind as also the reasons for cancellation as contained in clause 7(1)(n) thereof.”

12.     In such a situation the repudiation made by the Opposite Parties-Insurance Company regarding genuine claim of the complainant have been made without application of mind. It is usual with the insurance company to show all types of green pasters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation.  This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible.  It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-

“It seams that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.  The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.

13.     In view of the above discussion, we hold that the Opposite Party-Insurance Company have  wrongly and illegally rejected the claim of the complainant.

14.     In view of the aforesaid facts and circumstances of the case,  we allow the complaint of the Complainant and direct Opposite Parties to reimburse the medical bills of the complainant upto the extent of Rs.27,380/- (Rupees twenty seven thousands three hundred and eighty only)  alongwith interest @ 8% per annum from the date of filing the complaint i.e. 02.04.2019 till its actual realization. Opposite Parties–Insurance Company is also directed to pay compensation to the complainant for causing him mental tension and harassment to the tune of Rs.10,000 (ten thousands only). The compliance of this order be made by Opposite Parties-Insurance Company within 45 days from the date of receipt of this order, failing which the complainant  shall be at liberty to get the order enforced through the indulgence of this District Commission. Copies of the order be furnished to the parties free of cost. File be consigned to record room after compliance.

Announced in Open Commission.

Dated: 21.04.2022.