D.O.F:27/06/2019

                                                                                                    D.O.O:10/01/2023

IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KASARAGOD

    CC.No.123/2019

Dated this, the 10^th day of January 2023

PRESENT:

SRI.KRISHNAN.K                         : PRESIDENT

SRI.RADHAKRISHNAN NAIR.M  : MEMBER   

SMT.BEENA.K.G                            : MEMBER

Mohanan, aged 48 years,

S/o late Narayanan Nair,

R/at Aishwarya, Mannippady,                                           : Complainant

P.O.R.D Nagar, Kudlu Village,

Kasaragod Taluk and District

(Adv. Sruthi.G.V)

                                                            And

1. The Chief Executive Officer,

Manipal Cigna Health Insurance Co.Ltd.,

Erstwhile Cigna TTK Health Insurance Co.Ltd.,

401/402, 4^th Floor, Raheja Titanium,

Off Western Express Highway,

Goregaon (East), Mumbai- 400063

: Opposite Parties

2. The Branch Manager,

Manipal Cigna Health Insurance Co.Ltd.,

Erstwhile Cigna TTK Health Insurance Co.Ltd.,

1^st Floor, Mathewsons Centre Point

Mamangalam, above Kotak Mahendra Bank,

Nr. Mamangalam Church, Ernakulam,

Cochin District, Kerala- 682025

(Adv. Saji Isaac. K.J. Op.1&2)

ORDER

SRI.KRISHNAN.K    :PRESIDENT

            The facts of the case of the complainant is that the complainant obtained a health insurance policy from Opposite party on 12/05/2015 by paying premium of Rs.10,456/-.  The complainant renewed the policy up to 2018-2019 by paying renewal premium.  Renewal premium is increased to Rs.15,435/- for the year 2019-2020.  So the opposite party collected excess amount of Rs.4,490/-.  The complainant sought relief to continue the policy terms without insisting payment of additional premium.  The complainant filed IA 125/2020 to amend the complaint.  Petition was allowed.   Amendment No.1, relief claimed is the Complainant is entitled to refund of excess renewal premium collected and that may be obtained by opposite party in future in the policy.  Amended prayer relates to issue of renewed policy with additional premium issued without consent of complainant.  The complainant further claims refund of all excess premium collected with interest.

2.  The Opposite Party filed their version complainant is made aware and informed by letter dated.  16/10/2018 of introducing enhanced version of pro-health insurance policy effective from that date providing better features.  The policy was due for renewal on 13/10/2019.  The complainant made telephone call and verified details of renewal premium.  The complainant remitted renewal premium after agreeing to its terms and conditions.  Earlier version of the product is discontinued and communicated to the complainant.  He is not entitled to any relief or compensation and this sought dismissal of the complaint.

3.  The opposite party filed additional version after amendment.  The complainant is bound by policy terms.  IRDA approved discontinuance of policy.  Renewed premium is paid after accepting its terms.  The complainant is not entitled to refund of premium already paid as per policy terms.

4.  The complainant did not adduce any oral evidence, documents are marked as Ext.A1 to A16.  The Complainants documents marked as Ext.A1 is the premium certificate, Ext.A2 is the premium renewal intimation Ext.A3 is the premium certificate, Ext.A4 is the policy schedule.  Ext.A5 is the lawyer notice copy, Ext. A6 is AD card, Ext.A7 policy schedule, Ext.A7 (a) is welcome kit policy schedule, Ext.A9 premium certificate, Ext.A10 premium renewal intimation.  Ext.A11 to A13 are copy of e-mail messages.  Ext.A14 is the premium payment receipt dated 16/02/2021.  Ext.A15 and A16 are policy schedule cum certificate.  The Opposite party also not adduced oral evidence.  Documents are marked as Ext.B1 to B5.  Ext.B1 and B2 are policy conditions.  Ext.B3 is the intimation of discontinuance of existing version.  Ext.B4 is policy renewal intimation 2019. Ext.B5 is the e-mail message.

5.   Based on pleadings of parties following points arise for consideration.

            a) Whether complainant is entitled to refund of any portion of renewal premium paid to Opposite Party in the case as claimed in the complaint?

b) Whether there is any Deficiency in services or negligence in not refunding amount of premium already collected on any of the grounds shown in the complaint.?

c) Whether complainant is entitled to any compensation or such other reliefs and if so for what reliefs ?

All points are discussed together for convenience

6.  Dispute relates to increase or enhancement of renewal premium to the tune of Rs.4,490/- than usual amount due.  Renewal premium are paid by the insured to the insurer in order to keep the policy in operation and avail the benefits of the policy.  If a policy holder fails to pay the premiums, then the policy lapses after a grace period.

            Insurance company cannot be compelled to renew the policy and to continue with their insurance since the subject falls within the reclaim of contract.

7.         Insurance company has a right to refuse the issuance of policy at the initial stage and also to refuse to renew the policy.  Insurance company, whether justified within its contractual rights to collect excess amount, renewal premium in the cases in dispute.

Exclusive privileges of these Insurance company’s in the filed of general insurance business was given a go-bye, they were bound to act in accordance with business principals even in the field of health care policy offering renewal clause in the policy was itself a sound business proposition so that business would not get directed to other companies after the initial cover is taken.  Therefore renewal was not automatic.  Whether renewal should be given or not, would depend upon the experience gained with the insured and if the insurer finds that it is not good to continue business with in the insured the insurer can stop it and refuse to renew such a policy. 

            In case where the insured may want to continue their cover, but with enhancement of the sum insured.  In such cases, the question of consenting to renew the cover for the extent of enhancement of the sum insured would arise and it is in the context of such enhanced sum that the company may became justified to consider exclusion of the disease so far the enhanced sum is considered though it would be liable to continue the cover for the basic sum insured, if the renewal premium was paid in time without seeking such enhancement.

            In case of renewal without a break in the period the policy will be renewed including the disease contracted during the expiring policy period.  If there is a break, the fresh policy must specifically exclude the disease. Contracted during the expiring policy period and during the break period and it should be mentioned in the schedule of the policy specifically.

            A policy of health insurance is for insuring against the risk of disease.  One is a policy for life while the other for a health life.  The contract of health insurance, like that if life insurance makes consideration of an annual premium, is an insurance for a year with an irrevocable offer to renew upon payment of the agreed renewal premium.

            In an existing contract where it is specifically provided that the insurer is not bound to give notice when the policy is due for renewal and the insured remits the renewal premium in time, the insurer cannot involve the cancellation clause for refusing renewal, unless any one of the contingencies permitting cancellation has occurred.  The moment insured pays premium in time the acceptance of that offer is complete and there would be no option with the insurer to deny renewal.  The insured has an option under the existing mediclaim insurance policy to continue the cover by payment of renewal premium in time in respect of the sum insured renewal premium is paid.

            In case of renewal with break the period, the mediclaim insurance policy will be renewed without excluding any disease already covered under the existing policy which may have been contracted during  the period of the expiring policy.

            In cases where the insured seeks an enhancement of the amount of sum insured at the time of renewal the option to renew will not extend to the amount of such enhancement and renewal thereof will depend up on the mutual consent of the contracting parties.

            Renewal of a mediclaim insurance policy cannot be refuse, despite timely payment of the renewal premium, on the ground that continuance of the cover would become more onerous or burdensome for the insurer due to the insured contracting a covered diseases during the period of the existing policy.

            It has to be appreciated that in the present case the Insurance Company did not say that it wants to load premium.  The said loading of premium may be permissible but that too only to a reasonable extent and not with the object of making the renewal impossible.

            People purchase health insurance to protect themselves from the financial consequences of possible future illness.

            However, health insurance is different from those other forms of insurance.  Health insurance addresses a mere fundamental need and this is protecting people who purchase health insurance.

            Hence, directing the insurance company to renew the policy from the dates of its expiry on payment of renewal premium payable by them as per policy without adding additional premium under the scheme and within contracted during the period of policy.

For the foregoing reasons:

1. The insured has an option under the existing medi claim insurance policy to continue the cover by payment of renewal premium in time in respect of the sum insured for the future period to come.
2. In case of renewal without break in the period, the medi claim insurance policy will be contracted during the period of the expiring policy.  Renewal of mediclaim insurance policy cannot be refused on the ground of refusal of payment of enhanced premium under the existing policy is concerned.
3. In cases where the insurance seeks an enhancement of the amount of sum insured at the time of renewal, the option to renew will not extend to the amount of such enhancement and renewal thereof will depend upon mutual consent of the contracting parties.

If health insurance could be cancelled or premium dramatically increased whenever people used their coverage, very purpose will be defected.

The complainant renewed the mediclaim policy by collecting additional premium of Rs.4,490/- without meeting requirement of law and hence the complainant is compelled to approach this Commission to redress the grievance.  Thus there is Deficiency in Service of Opposite Party hence the complainant is entitled to refund of the excess renewal premium namely Rs4,490/-.  Since there is no negligence or intentional denial of renewal of policy and service is continued by renewing the policy claim for compensation is dis-allowed.  The complainant is also entitled for cost of litigation and it is qualified as Rs. 5,000/-.

In the result complaint is allowed in part and opposite party is directed to pay Rs.4,490/- (Rupees Four Thousand Four Hundred and Ninety only)  to complainant towards refund of the excess renewal premium and also directed to pay Rs.5,000/- (Rupees Five Thousand only) towards litigation cost within one month from date of receipt of the order.

      Sd/-                                                   Sd/-                                                             Sd/-

MEMBER                                    MEMBER                                      PRESIDENT

Exhibits

A1: Premium Certificate

A2: Premium policy renewal intimation

A3: Premium Certificate

A4: Policy Schedule

A5: Lawyer notice copy

A6: Acknowledgment Card

A7: Policy Schedule

A7(a): Welcome kit policy schedule

A8: Policy Schedule

A9: Premium certificate

A10: Premium renewal intimation

A11: Copy of e-mail messages

A12: Copy of e-mail messages

A13: Copy of e-mail messages

A14: Premium Payment receipt

A15: Policy schedule cum certificate

A16: Policy schedule cum certificate

B1: Policy Schedule

B2: Policy Schedule

B3: Intimation of discontinuance of existing version

B4: Policy renewal intimation

B5: E-mail message

       Sd/-                                                   Sd/-                                                        Sd/-

MEMBER                                    MEMBER                                      PRESIDENT

Forwarded by Order

                                                                                    Assistant Registrar

Ps/