The titled complainant (in active service of Punjab Govt. Health Dept. having tested positive for COVID-19 on 06.02.2021) has filed the present complaint against the titled opposite parties, getting aggrieved at their alleged arbitrary repudiation of his otherwise a valid insurance-claim for Rs.2.0 Lac, claiming its resolve/settlement at full-amount besides compensation @ Rs.50,000/- and cost of litigation @ Rs.10,000/-, in the interest of justice. The complainant at the recommendations of his banker (the OP3 Bank) had purchased the Reliance COVID-19 Protection Insurance Policy # 160192028521000724 with a Sum Insured of Rs.2.0 Lac @ a premium of Rs.2,950/- valid from 05.05.2020 to 04.05.2021.

2.        The OP1/2 insurers had assured him that any 'insured' under the policy shall be paid a lump sum amount of Rs.2.0 Lac upon his/her having contacted COVID-19, testing positive, during the validity-period of the said policy. The complainant did fill and file the proposal form with the OP3 Bank, who were the Master Policy Holders, and was registered as a member of the Group Insurance. Somehow, the complainant did catch COVID-19 and tested positive at the RT-PCR Test on 06.02.2021 and filed the insurance-claim # 221100 5599 with the OP2 insurers on 22.02.2021 under the related policy after having undergone the specified home-isolation cum medical-treatment (COVID-specific) etc.

3.        However, the OP2 insurers on 24.03.2021 mailed the query letter requisitioning the ICMR-SRF Form/Report along with all the other treatment/ consultation papers that were duly filed/submitted by the complainant who on 30.04.2021 instead of claim-proceeds did receive the 'repudiation' comprising of the rejection-remarks that the insured complainant in his proposal-form had not disclosed his posting in the COVID designated hospital/facility and thus the claim has been rejected on account of non-disclosure/ misrepresentation etc. The complainant did respond that he has been posted as the Admin Staff in the T.B. office of the Civil Surgeon, Gurdaspur and was not linked with the COVID-facility ward, directly or even indirectly. However, the OP insurers did finally reject/repudiate the insurance-claim on 30.05.2021 and hence the present complaint duly accompanied by the complainant's Affidavit Ex.C1 along with the documents in evidence (exhibited herewith as Ex.C2 to Ex.C17) and the rejoinders to the written statements by both the opposite parties, seeking the relief(s) as prayed in the opening paragraph of the instant complaint.

4.        The titled opposite party insurers (the OP1&2 insurers), in response to commission’s summons/notice appeared through their common counsel and filed the written reply stating therein preliminary as well as other objections (on merits) as:

5.        That the present complaint is not maintainable as the same has been filed against the terms of the related policy as it has failed to disclose any deficiency in service besides being absolutely false and frivolous. And, all the allegations have been denied at the very outset and non-traversal of any paragraph be read as categorical denial. The complainant has misguided the forum as no cause of action was ever arisen in his favor and the present complaint has been an abuse of the process of law and thus has been liable to dismissal with exemplary costs. On merits, to cut it short, the OP insurers, have admitted the bare facts pertaining to the complaint and have admittedly rejected/repudiated the impugned claim on the lone count of non-disclosure/suppression of the material fact in his proposal form that the complainant has been working in the one designated COVID-facility hospital. However, that issue has been clarified by the complainant that he works in Admin Office & not in the Hospital ward of the COVID-FACILITY but the OP insurers have affirmed rejection /repudiation on the issue of non-disclosure amounting to misrepresentation and that does violates the terms of the related Policy. Lastly, the OP 1 & 2 insurers have sought dismissal of the present complaint and have filed the Affidavit (Ex.1,2/1/W) along with other papers/ documents in evidence (as duly exhibited herein as: Ex.1,2/1 to Ex.OP1,2/4) in support of the prosecution of their defense. 

6.        Similarly, the titled opposite party Bank (the OP3 Bank), in response to commission’s summons/notice appeared through their counsel and filed the written statement giving their introduction in detail and also stating therein preliminary as well as other objections (on merits) denying therein all the contents as well as the allegations as put forth vide the present complaint. The OP3 Bank has denied as ever being or having acted as an agent or a representative of the OP insurers and have sought dismissal of the present complaint as the matter in issue has been between the complainant and the OP insurers. The OP3 Bank has produced Affidavit Ex.OP3/1 and the RBI letters Ex.OP3/2 & Ex.OP3/3 pertaining to its own incorporation and licensing/functioning etc.  

7.        We have examined the available documents/evidence on the records so as to statutorily interpret the meaning and purpose of each document and also the scope of adverse inference on account of some documents ignored to be produced/not produced by the contesting litigants against the back-drop of the arguments as put forth by the learned counsels for their respective litigants.

8.        We find that the present dispute has arisen on account of the impugned 'rejection/repudiation' of the complainant's 'insurance-claim' by the OP1&2 insurers on the grounds of non-disclosure of material fact of his posting in the one designated COVID-FACILITY hospital at the time of purchase of the related policy.

9.        The OP3 Bank has duly stated as having ever acted as an agent of the OP1&2 insurer or having ever recommended the COVID-19 policy to the insured complainant but have failed to produce any evidence in support of their above statement whereas the Proposal Form (Ex.C3) as produced by the complainant clearly mentions the name of the OP3 Bank Equitas Small Finance Bank as as the Intermediary with IMD code as: 17B36389 and IMD Branch Code as: 1601 and that proves the OP3 Bank to be an Agent/ Representative of the OP1&2 insurers in mobilizing the policy, in question, as the complainant has been Account Holder of the OP3 Bank with S.B. A/c No.100007058315 and thus the complainant's employment, posting and health-status has been fully in the notice and knowledge of the OP3 bank and its employees mobilizing the insurance policies on behalf of the OP insurers; And, thus also in the knowledge of the OP1&2 insurers by implication and thus they are presently stopped to reject/ repudiate the related claim by virtue of the law of estoppel that bars 'current' on account of certain 'past' events. Moreover, section 45(3) of the Insurance Act, 1938 (as amended up to date) bars repudiation of Policy on account of mis-statement(s) and/or suppression of fact(s) that are within the knowledge of the insurers or its representatives.   

10.      Thus, we find that the OP insurers are not justified in their main plea objection of 'non-disclosure' of the material facts in the related proposal-form. We further observe that the OP insurer's other trivial objections are ambiguous, in nature, and no more that petty queries in non-fidelity/ignorance and have been well replied/responded to by the complainant in his arguments/pleadings. The OP insurers must realize that their resolves to the claims are open to judicial review and need be determined with application of mind and not in an arbitrary manner but need to explain the logic as to how the same has been reached.

11.      In the light of the all above, we set aside the OP insurers' impugned rejection of the impugned claim, being arbitrary (and in contravention to laws of natural justice) and amounting to ‘unfair trade practice/ deficiency in service’. Thus, we ORDER the OP insurers to pay the impugned ‘insurance-claim’, in full, to the tune and order in terms of the related policy with interest @ 6% PA w e from the date of the claim till realization besides Rs.10,000/- in lump sum as compensation cum cost of litigation within 45 days of receipt of the copy of these orders, otherwise the entire awarded amount shall attract additional interest @ 3 % PA form the date of the orders till actually paid.

12.      The complaint could not be decided within the stipulated period due to heavy pendency of Court Cases, vacancies in the office and due to pandemic of Covid-19.

13.      Copy of the order be communicated to the parties free of charges. After compliance, file be consigned to record.           

                                                                  (Naveen Puri)

                                                                        President.

ANNOUNCED:                                          (B.S.Matharu)

NOV. 03, 2022.                                                 Member.

YP.