Punjab

Ludhiana

CC/20/266

Sunil Kumar Aggarwal - Complainant(s)

Versus

SBI General Insurance Co.Ltd - Opp.Party(s)

Hrinder Pal Singh Adv.

06 Mar 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:266 dated 23.10.2020.                                                         Date of decision: 06.03.2024.

 

Sunil Kumar Aggarwal aged 51 years son of Sh. Raj Kumar Aggarwal, R/o. Ward No.1, Near National Convent School, Near M.C. Office, Mohalla Ajitsar Raikot, Tehsil Jagraon, District Ludhiana.

….. Complainant

                                                         Versus

1. SBI General Insurance Company Limited having its Head Office at 301, Natraz Junction of Western Express Highway, Andheri, Kurla Road Andheri, East Mumbai-400069, Maharashtra through its Director/Managing Director.
2. SBI General Insurance Company Limited having its Branch office at Ground Floor, Sahni Plaza, Near Dada Motors & Indian Oil Petrol Pump, G.T. Delhi Road, Dholewal Chowk, Ludhiana, Punjab through its Branch Manager/authorized signatory.
3. Sumit Kumar agent/advisor SBI General Insurance Company Limited having its Branch office at Ground Floor, Sahni Plaza, Near Dada Motors & Indian Oil Petrol Pump, G.T. Delhi Road, Dholewal Chowk, Ludhiana

…..Opposite parties 

Complaint Under section 35 of the Consumer Protection Act, 2019.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

MS. MONIKA BHAGAT, MEMBER

 

 

COUNSEL FOR THE PARTIES:

For complainant             :         Sh. Gurmeet Singh Saini, Advocate.

For OP1 and OP2          :         Sh. Vyom Bansal, Advocate.

For OP3                         :         Complaint against OP3 already dismissed as                                                withdrawn vide order dated 09.03.2022.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                Shorn of unnecessary details, the facts of the case are that the complainant availed home loan of Rs.24 Lac from State Bank of India Branch Raikot Tehsil Jagraon, District Ludhiana by pledging his residential house at Raikot Tehsil Jagraon, District Ludhiana. The bank kept sale deed of his residential house as security for repayment of loan. At that time, OP3 approached the complainant and apprised him about benefits of insurance plans of OP1 and OP2. The complainant stated that he got an insurance plan of Rs.50 Lacs on premium of Rs.85,786/- vide receipt No.7323068 dated 10.03.2018 for coverage of the sanctioned loan amount. The complainant was issued policy No.0000000008552230 w.e.f. 10.03.2018 to 09.03.2019 which was a critical disease policy covering all the deadly diseases like heart disease, cancer, brain hemorrhage etc. to the complainant and OP1 and OP2 assured to make payment of Rs.50 Lac to the complainant. As per premium certificate of the policy the complainant claimed to have paid Rs.65,200/- towards critical illness coverage.

                   The complainant further stated that he never fallen ill seriously till availing the home loan and issuance of insurance policy from the OPs. However, in the month of July 2018, the complainant faced health problem and on examination on 14.07.2018 he was diagnosed as “Coronary Artery Bypass Graft”. He was admitted at Global Heart and Super Speciality Hospital, Ludhiana where he remained hospitalized from 18.07.2018 to 19.07.2018 and he was suggested surgery of heart immediately. On 27.07.2018, the complainant again visited the doctors and he was admitted on 30.07.2018 at Global Heart and Super Speciality Hospital, Ludhiana where surgery was performed on 31.07.2018 and he remained admitted till 06.08.2018. The complainant duly informed the OPs regarding his operation and treatment but the OPs did not pay any heed and failed to pay the bills. Thereafter, the complainant approached OP3 who asked to fill the forms and written formalities to which the complainant dully complied but the OPs put the matter off on one pretext or the other. The complainant further stated that due to heart operation, he remained at home as advised by the doctors and moreover, he could not climb stairs and became dependant on the OPs to pay off the loan of the bank as assured by them. The complainant again submitted documents on 19.10.2018 with request to pay of his entire loan to the bank but to no effect. Even the complainant sent Email dated 02.01.2019, second reminder on 25.01.2019, last and final reminder on 08.03.2019 and on 21.12.2019 asked for latest status of his claim. The OPs sent replies on 22.12.2018, 03.01.2019, 25.01.2019, 06.02.2019, 18.02.2019, 09.03.2019, 19.03.2019, 12.07.2019, 31.08.2019, 05.09.2019 to the complainant with regret for delay in passing his claim. The complainant sent legal notice dated 20.04.2019 to the OPs and also sent a complaint to grievance cell on 10.08.2019. According to the complainant, OP1 and OP2 admitted his claim to the extent of Rs.3,56,000/- in an illegally manner which was the amount of loan lying in one loan account only but failed to pay the balance amount out of Rs.50 Lac. Rather on 26.10.2019, the OPs sent a covering letter dated 20.09.2019 which was received by him on 15.11.2019. The OPs have illegally withheld the insurance amount and have rendered deficient services etc. In the end, the complainant prayed for issuing direction to the OPs to pay Rs.50 Lacs to him along with interest and compensation of Rs.5 Lacs and litigation expenses of Rs.50,000/-.

2.                On 09.03.2022, the counsel for the complainant suffered statement to give up OP3 and as such, vide order dated 09.03.2022, the complaint against OP3 was dismissed as withdrawn.

3.                Upon notice, OP1 and OP2 appeared and filed written statement by taking preliminary objections that on the ground of maintainability of the complaint; lack of jurisdiction; concealment of material facts; beyond limitation; lack of cause of action etc. 

                   Under the column of factual submission, OP1 and OP2 stated that the complainant was insured under Loan Insurance Policy subject to terms and conditions of Policy No.8552230 from 10.03.2018 to 09.03.2019 against loan amount in loan account No.65009499529 of State Bank of India. The complainant was issued policy documents including terms and conditions etc. OP1 and OP2 further stated that a reimbursement claim was intimated by the complainant which was registered vide claim No.543513 and administered their In-house TPA under Loan Insurance Product. The complainant was intimated for re-imbursement of hospital & medical bills in respect of his Coronary Artery Bypass Graft done at Global Heart and super Specialty Hospital on 31.07.2018. The TPA assessed and scrutinized all the claim documents submitted by the complainant to determine his claim eligibility in terms of policy conditions. OP1 and OP2 further stated that the Loan Insurance Policy is meant to be issued to home loan borrowers for the amount of loan. The issued policy also mentions as “Home Loan” against type of loan field and the loan account No.65009499529 was also mentioned in the policy pertaining to sanctioned home loan for Rs.9 Lacs and had outstanding for Rs.3.56 Lacs at the time of assessment. Even in the submitted proposal form submitted by the complainant, scope of cover for critical illness was maximum to the amount of loan. Further as per policy conditions, the liability of the insurance company to reimburse the complainant was established at maximum of the amount of loan outstanding in the Loan Account No.65009499529.  OP1 and OP2 further stated that they allowed the claim for Rs.3,56,000/- i.e. the equivalent of outstanding loan amount, which was paid to the complainant through NEFT on 09.07.2019 in his account No.50100125951725. According to OP1 and OP2, they have duly decided the claim of the complainant and have paid the due amount.

                   On merits, OP1 and OP2 reiterated the crux of averments made in the preliminary objections and facts of the case. OP1 and OP2 have denied that there is any deficiency of service and have also prayed for dismissal of the complaint.

4.                In support of his claim, the complainant tendered his affidavit Ex. CA in which he reiterated the allegations and the claim of compensation as stated in the complaint. The complainant also tendered documents Ex. C1 is the copy of policy documents, Ex. C2 is the copy of medical bills/documents, Ex. C3 and Ex. C4 are the copies of E-mails, Ex. C5 is the copy of legal notice dated 20.04.2019, Ex. C6 is the copy of complaint dated 10.08.2019 to Grievance Cell of the OPs, Ex. C7 is the copy of Reply to the legal notice of the complainant by the OPs on 20.09.2019 and closed the evidence.

5.                On the other hand, counsel for OP1 and OP2 tendered affidavit Ex. RA of Sh. Jitendra Dhabhai, Authorized Signatory of SBI General Insurance Co. Ltd., at Pusa Road, Ludhiana along with document Ex. R1 is the copy of policy schedule, Ex. R2 is the copy of proposal form, Ex. R3 is the copy of SBP Home Equity, Ex. R4 is the copy of settlement voucher and closed the evidence.

6.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written reply along with affidavit and documents produced on record by both the parties.

7.                Admittedly, the complainant obtained a loan of Rs.50,00,000/- from State Bank of India, Branch Raikot, Tehsil Jagraon, District Ludhiana vide loan account No.650009499529 having an EMI of Rs.37,500/- per month. State Bank of India being an intermediary got insured the loan of the complainant from OP1 and OP2 SBI General Insurance Co. Ltd. vide policy Ex. C1 = Ex. R1 w.e.f. 10.03.2018 to 09.03.2019. The relevant particulars of the policy Ex. C1 = R1 are reproduced as under:-

          “3. Details of individual(s) insured under the policy:

Insured	Sunil Kumar Aggarwal
Contact Details	+91-8556919000
Date of Birth (DD/MM/YYY)	28/08/1969
Gender	Male
Nominee	Sajan Aggarwal
Name and Address of the Financial Institution	State Bank of India Raikot
Type of Loan	Home Loan
Loan Amount	50,00,000.00
Loan Account Number	65009499529
Plan Type	Fixed
Equated Monthly Installment Amount (EMI)	37,500.00
Period of Insurance	From 10/03/2018 (12:27 Hrs) to Midnight of 09/03/2019

 

4. Summary Particulars of Scope of Cover

No. Section I	Coverage Insured Event Applicable (Subject to Terms and Conditions of the policy)	Sum Insured in INR
Major Medical Illnesses & Procedures	a) First Diagnosis of the below-mentioned illnesses more specifically described below: 1. Cancer 2. Kidney Failure 3. Primary Pulmonary    Hypertension 4. Multiple Sclerosis; or   b) Undergoing for the first time of the following surgical procedures, more specifically described below 1. Major Organ Transplant 2. Coronary Artery Bypass Graft 3. Aorta Graft Surgery 4. Heart Valve Surgery   c) Occurrence for the first time of the following medical events more specifically described below: 1. Stroke 2. Myocardial Infarction 3. Coma 4. Total Blindness 5.  Paralysis	5,000,000.00
II. Personal Accident	Death of the Insured Person on account of an Accident. Permanent Total Disablement of the Insured Person on account of Accident	5,000,000.00
III. Loss of job	Loss of employment of the Insured Person	37,500/- per month for 3 months

 

8.                During the subsistence of the insurance policy, on 14.07.2018, the complainant was diagnosed as “Coronary Artery Bypass Graft” and was admitted at Global Heart and Super Speciality Hospital, Ludhiana from 18.07.2018 to 19.07.2018 and further on advice of doctors, he was again admitted in the said hospital on 30.07.2018. On 31.07.2018, surgery was conducted upon the complainant and he remained admitted till 06.08.2018. This fact is evident from the discharge summary dated 19.07.2018 as well as 06.08.2018 of Global Heart and Super Specialty Hospital, Ludhiana  that the complainant underwent Coronary Angiography on 31.07.2018. The complainant was discharged in satisfactory condition. Thereafter, on 19.10.2018, vide Ex. C3, the complainant submitted claim regarding his hospitalization and treatment with the OPs, out of which OP1 and OP2 finally settled the claim of Rs.3,56,000/- and was transferred in account of the complainant through NRFT on 09.07.2019.

9.                The counsel for the complainant has contended that the complainant was insured for Rs.50,00,000/- as mentioned in Loan Insurance Policy Schedule and as such, the complainant is entitled for claim of Rs.50,00,000/- as per terms and conditions of the policy. The OPs have miserably failed to settle the same.

10.              On the other hand, the counsel for OP1 and OP2 contended that the originally sanctioned loan of the complainant was to the tune of Rs.9,00,000/- and had an outstanding of Rs.3,56,000/- at the time of assessment of his claim and as such, the OPs assessed and reimbursed the claim as Rs.3,56,000/- to the complainant.

11.              We have heard the rival contentions of the parties and have also gone through the record on the file.

12.              Now the point of consideration arises as to what is the sum payable under the insurance policy in question. It is desirable to reproduce the relevant terms and conditions of Customer Information Sheet, the part of Loan Insurance Policy Schedule Ex. C1 = R1, which reads as under:-

 

Sr. No.	Title	Description	Refer to policy Clause Number
2.	What am I covered for	Under Critical Illness Section:-   At any point of time during the term of the policy, if you are diagnosed with any of the 13 critical illnesses as mentioned below, the benefit shall be payable as mentioned in the schedule, only if the you are alive for a period of more than or equal to 28 days (or as specifically stated period of time in any of the definitions given in policy wording):   A. First diagnosis of the below-mentioned Illnesses more specifically described below:   1. Cancer of Specified Severity 2. Kidney Failure Requiring Regular  Dialysis 3. Primary Pulmonary Arterial Hypertension 4. Multiple Sclerosis With Persisting Symptoms   B. Undergoing for the first time of the following surgical procedures, more specifically described below:   1. Major Organ/Bone Marrow Transplant 2. Open Chest CABG 3. Aorta Graft Surgery 4. Open Heart Replacement or Repair of Heart Valves   C. Occurrence for the first time of the following medical events more specifically described below:   1. Stroke Resulting in Permanent Symptoms 2. First Heart Attack of Specified Severity 3. Coma of Specified Severity 4. Total blindness 5. Permanent Paralysis of Limbs	III. Scope of Cover & Benefits

 

Loan Insurance Policy

1. “Critical Illness Benefit” means the amount specified in the Schedule, which is the maximum amount for which Insurer may be liable to make payment for any or all Critical Illnesses covered subject to terms & conditions under this Policy.

Benefit Payable under Section I: The Company hereby agrees, subject to the terms, conditions and exclusions applicable to this Section and the terms, conditions, General Exclusions stated in this Policy, to pay the Sum Insured in relation to the Insured person as stated against Section I under the policy schedule on the occurrence of an Insured Event as stated above under this Section.

20.     Termination of Policy – This Policy terminates on earliest of the following events-

          a)      Cancellation of policy by as per the cancellation provision.

          b)      On the policy expiry date.

          c)       The event giving rise to claim under any of below:

                             a.       Critical Illness Section

                             b.       Personal Accident Section.

 

13.              A conjoint reading of the aforesaid terms of the policy makes it abundantly clear that in order to avail the reimbursement under this policy, an insured is required to be diagnosed with any of 13 critical illnesses and thereafter, he is required to be alive for a period of more than or equal to 28 days from the date of diagnosis or date of surgical procedure or occurrence for the first time depending upon the nature of critical illness. Further “Critical Illness Benefit” refers to the maximum payable amount by the insurer stipulated in the Schedule of the policy. Further the Benefit Payable under Section 1 of the Policy terms and conditions also means payment of sum insured and not the loan amount. It is also provided that in case of event giving rise to claim under ‘Critical Illness Section’ or ‘Personal Accident Section’, then the policy stands automatically terminated. In the present case, the complainant was diagnosed to be a case of “Coronary Artery Bypass Graft” on 14.07.2018 and he was operated upon for CABG on 31.07.2018 and was discharged from the hospital on 06.08.2018. It is not the case of the OPs that the case of the complainant falls within exclusion applicable to the Section 1 or any other terms and conditions which disentitle the claimant for availing the critical illness benefit payable under this policy. The sum insured in this case as repeatedly reflected from the documents is Rs.50,00,000/-. The OPs have not placed the recommendations of TPA on record which could have been examined by this Commission about modus operandi adopted by the TPA in assessing the amount to be Rs.3,56,000/-. No statement of loan account has been placed on record so that the outstanding loan amount could have been ascertained by this Commission. The plan adopted by the complainant at the time of availing the insurance policy is fixed and the calculation made by the OPs appears to have been made on the basis of reducing plan. From the perusal of these terms of the policy, it is the sum assured and not the loan amount which is a criteria for paying “Critical Illness Benefit”. Therefore, the settlement of the amount of Rs.3,56,000/- is not in conformity of the terms and conditions of the policy.

14.              The contract of insurance is binding upon the parties and its terms and conditions would prevail. Therefore, nothing can be added or subtracted for assigning different meaning to the words mentioned in the policy. In this regard, reference can be made to 2023 LiveLaw (SC) 90 in National Insurance Company Ltd. Vs The Chief Electoral Officer and others whereby the Hon’ble supreme Court of India has made the following observations:-

“26. We would first like to elucidate the principles on which a claim under any insurance policy is examined. It is trite to say that the terms of the insurance policy are to be strictly construed.

27. The insurance contracts are in the nature of special class of contracts having distinctive features such as utmost good faith, insurable interest, indemnity subrogation, contribution and proximate cause which are common to all types of insurances. Each class of insurance also has individual features of its own. The law governing insurance contracts is thus to be studied in three parts, namely, (1) general characteristics of insurance contracts, as contracts; (2) special characteristics of insurance contracts, as contracts of insurance, and (3) individual characteristics of each class of insurance.

 28. Now turning to some of the judicial pronouncements, wherein it has been opined that the words used in a contract of insurance must be given paramount importance and it is not open for the Court to add, delete or substitute any words (Suraj Mal Ram Niwas Oil Mills (P) Ltd. vs. United India Insurance Co. Ltd.) 2010 SCC Online SC 1148. Insurance contracts are in the nature where exceptions cannot be made on ground of equity and the Courts ought not to interfere with the terms of an insurance agreement (Export Credit Guarantee Corporation of India Limited vs. Garg Sons International) 2014(1) SCC 686.

29. This Court in Vikram Greentech India Ltd. v. New India Assurance Co. Ltd.2002(5) SCC 599 reiterated that the insured cannot claim anything more than what is covered by the insurance policy. The terms of the contract have to be construed strictly, without altering the nature of the contract as the same may affect the interests of the parties adversely. The clauses of an insurance policy have to be read as they are. Consequently, the terms 8 Justice K Kannan, Principles of Insurance Law Chapter 3 (Volume 1, 10th ed. 2017, pg. 31) 9 2010 SCC OnLine SC 1148 10 2014 1 SCC 686 11 (2009) 5 SCC 599 6 of the insurance policy, that fix the responsibility of the insurance company must also be read strictly.

30. In several other judgments, this court has held that the insurance contract must be read as a whole and every attempt should be made to harmonise the terms thereof, keeping in mind that the rule of contra proferentem does not apply in case of commercial contract, for the reason that a clause in a commercial contract is bilateral and has mutually been agreed upon.”

 

Therefore, applying ratio of law, we have no hesitation in giving direction to OP1 and OP2 to settle and reimburse the claim of the complainant on the basis of sum insured of Rs.50,00,000/-(Rupees Fifty Lacs only) instead of loan amount as per terms and conditions of the policy Ex.C1 = Ex.R1 within 30 days from the date of receipt of copy of order along with composite costs of Rs.10,000/-.

15.               As a result of above discussion, the complaint is partly allowed with direction to OP1 and OP2 to settle and reimburse the claim of the complainant on the basis of sum insured of Rs.50,00,000/- (Rupees Fifty Lacs only) instead of loan amount as per terms and conditions of the policy Ex. C1 = Ex. R1 within 30 days from the date of receipt of copy of order. OP1 and OP2 shall also pay a composite compensation of Rs.10,000/- (Rupees Ten Thousand only) to the complainant. Compliance of the order be made within 30 days from the date of receipt of copy of order. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.       

16.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Monika Bhagat)                                       (Sanjeev Batra)

Member                                                     President    

 

Announced in Open Commission.

Dated:06.03.2024.

Gobind Ram.