JUDGEMENT

          Complainant by filing complaint has submitted that he purchased one Mediclaim Policy from op/Insurance Company for the period from March-2000 to March-2001 for sum assured of Rs.35,000/- by paying annual premium as usual for the Mediclaim Coverage of all the members of his family and said policy was continuous as well as claimless one as usual since 2000 save and except claim of only Rs.5,000/- in one occasion.  Subsequently for renewal of the said policy he issued blank cheque as usual to the agent a representative of the op in good faith who used to fill up the required amount as annual premium and for one decade arrangement had been working flawlessly by the agent without any problem.

          But for the year 2011, renewal date was 27^th March and accordingly complainant issued a cheque for the annual premium to be paid to the op company and handed over the same to the agent as usually along with paper for policy being No.100203704 for the period from 28.03.2011 to 27.03.2012 for covering the lives of him and his parents, his brother and the spouse with sum assumed Rs.1 lac each and agent assured that renewal of the policy would be as usual as the last one decade long and there was no inkling of any dishonour of the cheque.

          So, complainant relied upon the agent and handed over blank cheque with his signature.  Suddenly complainant got a letter from the op company on 31.03.2011 received on 22.04.2011 stating that the policy has been cancelled for dishonour of his cheque against renewal.  Fact remains the premium of the previous year was Rs.9,205/- and there is no increase in the sum assured or number of persons to be covered, so as per his common perception that premium would be less than Rs.10,000/- and in his bank pass book balance was Rs.10,810/- as on 25.03.2011.  So in general sense the balance was enough to satisfy the premium amount.

          But the root cause of the doldrum is the sudden hike of the amount of premium by sum of Rs.1,500/- abruptly and the premium amount was Rs.10,947/- when the balance stood in his account was Rs.10,810/-.  So shortage was of Rs.130/- and op company did not bother to enhance the premium amount by an amount of Rs.1,500/- save the slightest inkling of the matter and the op company did not inform the complainant at all the cause of enhancement of premium etc. and abrupt enhancement of premium and unilateral enhancement put him to such harassment and problem.  But fact remains the op company issued the policy bond for the year 28.03.2011 to 27.03.2012 as usually and the complainant could be even imagine that such an untoward incident may occur.

          In fact the letter of the company dated 31.03.2011 reads “if any policy is issued against the cheque then its stands cancelled since inception”.  But there must be a grace period, a period for consideration especially for such policy which have been continuing for years together.  But no such claim report is available.

          Fact remains for the instant case op’s conduct and behavior is completely unethical and practically op for purpose of dishonour of the cheque without informing the enhancement amount of premium cancelled the policy without giving further chance.  Moreover there was no record of cheque dishonour in the Bank statement and complainant did not get any inkling or slightest information about that and op company also did not find any need or duty to intimate of the same in time.  So that complainant may manage the situation before that.  Fact remains complainant was issued a memo from the op company dated 31.03.2011 intimating the return of the cheque un-cleared but the memo dated 31.03.2011 was actually delivered as late on 19.04.2011 and the complainant was busy with the matter and could not pay much time to the matter.

          Subsequently complainant issued a letter dated 24.05.2011 to the op company requesting the op to consider the case for continuance of the policy without any break and the letter was received by the op office on proper seal and signature and the Chief Manager, Headquarter of the op company issued the complainant e-mail dated 06.11.2011 asking to approaches their policy issuing office Kolkata Regional Office again e-mail dated 29.05.2011 against that complainant prayed to the op authority for continuing his old mediclaim policies and the matter was also informed to the Secretariat to the Govt. of India and also the Minister of Health and Family Welfare and after that complainant lodged a complaint before the Directorate of C.A & F.B.P., Govt of West Bengal for redressal and accordingly a tripartite mediation meeting was convened and the op represented the matter on 03.11.2011 but on the second hearing on 29.12.2011 they did not attend.

          Being harassed and deprived by the op for getting a redressal of the bona fide grievance this complaint was filed for proper relief and for accepting the said policy as a valid policy after accepting the entire premium.

          On the other hand the Insurance Company by filing written version has submitted that complainant issued one account payee cheque being No.675485 for a sum of Rs.10,947/- drawn on State Bank of India, Bagmari Branch, Kolkata as premium amount for renewal of his mediclaim policy 2007 covering the risk of hospitalization for himself and his other 4 members of the family having sum insured value of Rs.1 lac for each of them and op in turn presented the said cheque for clearance in their bank but the said cheque was dishonoured for insufficient fund.

          It is further submitted that on receiving the said account payee cheque for the premium amount, as per standard norm, this op issued a Mediclaim Policy  2007 bearing No. 51010034100100203704, valid for the period from 28.03.2012 to 27.03.2013 subject to realization of the premium amount and Mediclaim Policy 2007 clauses attached with the said policy but with the bounding of the said cheque for premium, the said policy stood cancelled from the date of inception of the said policy and the said fact was intimated to the complainant as per policy conditions.

          Fact remains after a long interval on or about the end of month of May,2011 the complainant asked for continuance of the said earlier mediclaim policy but the terms and conditions of the subject policy from which the respective rights of the parties emanate do not entitled the complainant to have such continuance of earlier policy and resultantly this op could not grant the complainant the said privilege of continuance policy at the backdrop of dishonour of the cheque for premium and even asking for continuance for such policy after a passage of substantial amount of time taken by the complainant.

          It is further submitted that the said condition as enumerated in the said policy does not give any further right.  Further it is submitted that conjoint reading of the contents of all the clauses and the factual aspect are considered in that case the benefit of cumulative bond also get losst if the policy is not renewed on the date of expiry and therefore substantive right of insured and insurer does not bestow any right to insured so as to enable the insurer to give the benefit accrued in the earlier mediclaim policy to the subsequent policy after renewal of such policy when renewal is not made in due time.

          Further op has submitted that the entire allegations are false and fabricated and it is the duty of the complainant to see that he issued a cheque being the amount of premium.  So it was his duty to see that the said amount was in his account or not because complainant is duty bound to issue cheque for the amount of premium as necessary for a particular calendar year upon renewal and he should have been aware of that and there is no point that insurer would intimate the complainant about the increase in the premium for policy and the op states that if by any manifestation complainant wants to focus a case of mis-representation, then he should have filed a complaint before the competent Criminal Court for that against the accused persons against whom he has approached such allegation.  But no such action has been taken against such agent or any other person who acted on his behalf.  So, in the circumstances complainant is not entitled to any relief and for which the complaint should be dismissed and applicant’s claim should also be dismissed.

                                                 Decision with reasons

          On maturity of the case and after hearing the Ld. Lawyers of both the parties and also considering the disputed policy it is found that disputed policy was issued by the Insurance Company being Policy No. 51010034100100203704 having validity period from 28.03.2011 to 27.03.2011 and fact remains that total premium was Rs.10,947/- and it was received on 26.03.2011.  So, considering the disputed policy, it is clear that complainant issued cheque and that was received by the op invariably op was satisfied because it was a renewal of the earlier policies, because previous policy number is referred in the said disputed policy i.e. Policy No. 51010034100100203704.  So, it is clear that complainant has been paying continuous yearly premium since 2001 and disputed policy was issued against renewal of the previous policy.  Now question is whether the policy was is valid or not.  In the policy it is stated that the amount was received and that policy was issued against renewal of policy but not a fresh policy and in the said renewal of the policy document there is no such assertion that cheque was not encashed or bounced and at the same time in the said policy document there is no such whisper that it was issued subject to encashment of the cheque and if cheque is not encahsed in that case the policy shall be cancelled.  But Ld. Lawyer for the op submitted practically cheque was received and as per general condition policy was issued but subsequently cheque was bounced for which the policy was cancelled.

          So, insurance company has no fault in this regard.  Moreover after considering the account statement of the State Bank of India of the complainant, it is found that on 25.03.2011 the total amount was Rs.10,810/- and on 12.04.2011 it was Rs.41,018/-.  But from the bank statement of the complainant, it is not evident that any cheque was placed during that period and it was dishonoured.  So, invariably complainant was not aware of the fact that such a cheque was tendered by the op and it was subsequently bounced.  Moreover op has not stated in their written statement actually on which date the said cheque was tendered for encashment and it was bounced.  Further it is not stated in the written version from whom the cheque was received.  But in the present complaint, it is specifically mentioned that the blank cheque with signature was given to the agent and agent after consulting the entire matter filled up the cheque and other papers and submitted it to the company for renewal.  But truth is that since 2001 till 2011 never the cheque was bounced as issued by the complainant to his agent for submission to deposit to op.

          Another factor is that the agent did not report that the premium has been increased abruptly because in the previous year it was Rs.9,000/- and above.  So, complainant hoped that at least amount of Rs.10,000/- is sufficient.  So, he kept Rs.10,810/- in his account for encashment of cheque, but he did not put the amount of the premium because he relied upon the agent of the op and truth is that agent of the op did it.  But about agent’s act op has not denied anything.  But it is the submission of the Ld. Lawyer for the op that if complainant is not satisfied about the act of the op’s agent, in that case complainant ought to have filed a case for breach of condition against agent but agent’s fault or any sort of overact on behalf of agent cannot be treated as act and overact of principal of the op.

          But in this case op tried to discharge their liability upon the agent and also tried to convince that it is a breach of trust of the agent to the customer/the complainant.  But it must be kept in mind that customer/consumer is complainant under the op, not the agent.  Agent shall be treated as mediator on behalf of the principal of the op.  So, in this case the allegations as made against the agent of the op is not denied by the op.

          Most interesting fact is that there is no question of issuance of any mediclaim policy before encashment of any cheque because it is a renewal of the policy.  Only the cheque in respect of the amount premium shall be submitted in support of the previous policy and no doubt complainant always acted and complied the terms through agent of the op and his agent acted for long years continiously with confidence for which the said policy was continued since 2001 up to 2011 and fact remains in the present case also complainant issued blank cheques with signature to the op for premium.  But agent did not return that abruptly when another sum of Rs.1,500/- has been increased as premium than that of the previous premium of Rs.9,000/- and odd.  Not only that for the sake of the argument if it is accepted that op accepted the cheque and when they found that the cheque was dishonoured in that case forthwith op ought to have reported the complainant that in the mean time the amount of premium has been increased.  So, signed cheque may be submitted, but that was not reported.  Though fact remains the cheque was issued on 15.03.2011 and truth is that op informed that matter by sending it by post which was received by the op on 22.04.2011 that means the op did not send the said information before 22.04.2011.  Though letter was of dated 31.03.2011 but it is completely official piracy on the part of the op.  In the present case complainant personally submitted that it is known to all consumer and the insurance company that generally in case of renewal of any policy in respect of Mediclaim Policy cheques are received by the insurance company through the agent without any not of amount because year to year at the end of March i.e. 31^st March increase of premium is made when the company’s office itself put the amount that is changed rate of premium and this is a common practice of the Oriental Insurance, National Insurance and other Insurance Companies and for which each year complainant handed over blank cheque to the agent and it is submitted to the company, company received it and thereafter at the fag end of March they put the actual amount which is assessed by the company as final premium for renewal and in this case same thing happened and when it is the matter of renewal then it was the duty of the op to inform the complainant that premium amount has been increased.  So, cheque amount would be such but that was not reported to the complainant by the op by any means whatsoever.  But in the mean time mischief has been done by the op and complainant received that letter on 22.04.2011 that the said cheque has been dishonoured for insufficient of fund when complainant came to learn that a sum of Rs.1,500/- has been increased as enhanced rate of premium and so the figure became Rs.10,947/- whereas on the previous year, the premium was Rs.9,205/- and so complainant relied upon that amount Rs.9,205/- that same amount shall be increased.  So, he kept Rs.10,810/- in his account i.e. fact and it was in the account but for shortfall of another Rs.130/- the cheque was dishonoured as stated by the op.  but bank statement does not speaks that cheque was placed and dishonoured.  At the same time op/Bank has not stated on which date the said cheque was placed for encashment and on which date that was bounced.  Whatever it may be it is our experience about mediclaim policy that in case of renewal of the mdeiclaim policy no amount is noted in the cheque at the time of handing over cheque to the agent and insurance company receives such blank cheques with signatures of the customer through agent and they put such amount without any information and in the present op’s office accepted blank cheque and practically it is generally submitted along with blank cheque with signature along with bank statement so that office may after consulting the balance of the account of the customer put such figure and write it in word if it is found in the bank account such consumer or customer balance is sufficient but if it is found customer’s amount is insufficient it is reported by the office to the customer or consumer over phone for paying further amount in the account for encashment of the cheque and this procedure is adopted but present insurance company i.e. Oriental Insurance or New India Assurance or National Insurance Companies in all respect has been continuously such practice for years together and not suddenly but no office can say that renewal premiums are paid by the party but agent submits blank cheque along with bank statement of the particular customer when by 31^st March enhancement of premium is made and further receipt of the enhancement chart of the premium, put the figures in the blank cheques for renewal after consulting the statement of account of particular consumer or customer.  But in this case practically abruptly a sum of Rs.1,500/-  was increased though previous year premium was Rs.9,205/- but in the year 2011-12 it was Rs.10,947/-.  But in the account of the complainant it was Rs.10,810/- and complainant invariably could not think for a moment that enhancement of premium shall be abruptly Rs.1,500/-.  So there was no fault on the part of the complainant and complainant handed over the blank cheque with signature with hope that it shall not be bounced when he is a bona fide mediclaim policy holder for last decade.

          So, in this case it is proved that it was fault on the part of the agent thus acting on behalf of the principal(op) and op’s office are dishonest in all respect and it is our personal experience.  In so many cases the Members of the Bench found always handed over blank cheque for submission to Insurance Company because there is no administration in those insurance companies and their staff are very much reluctant to entertain any fixed amount cheque because only on the 31^st March as per Insurance Co. Regulatory Authorities Guidance Rules they increase the premium amount against renewal of mediclaim policy and in this case same thing happened and we are sure if any version on behalf of the customer and office staff are recorded secretly in that case the present result shall be found that staff of the insurance company i.e. Oriental Insurance Co., New India Assurance Co., National Insurance Co. etc. are telling to hand over blank cheque and it is their duty to put actual figure after receipt of the enhancement chart and not to worry about that and public at large hand over blank cheque through agent for renewal of the policy.  So, considering the above situation we are convinced that fault was on the part of the op and his agent.

          Truth is that complainant had no intention to handover a blank cheque with signature, so that it may be bounced that was not his previous performance for one decade that is why op is very faithful.  Fact remains that the agent has committed offence and that act tantamount to over act of the op and agent for that the customer must not be harassed by the principal of the present op.  Truth is that policy was issued but in the policy, there is no such clause that this policy shall be cancelled if cheques shall be dishonoured but in the policy it is found that there is specific version that amount was received.  There is no mention that it was received by cheque and no copy of dishonor of cheque was also filed by the op in this case.

          So we are convinced that op authority had no legal right to cancel the disputed policy and fact remains all sorts of laches on the part of the op they did not inform that abruptly Rs.1,500/- has been enhanced as excess amount of premium over and above previous year premium of Rs.9,205/- and another factor is that this matter was reported just before 24.04.2011.  But letter dated 31.03.2011 it indicates that it is back dated letter because the insurance company staff were engaged with other activities, not to attend the customers about their grievance, not to attend the customer to inform that the previous year’s premium has been enhanced to some extent that is too high.  So, he shall have to pay such and such amount and without adopting the fair path of business in this case practically the op authority cancelled the policy document issued by them.  But fault completely was on the part of the op and in this regard we have heard from the complainant that regarding this issue there was a conversion in between him and the op office authority and that is recorded by him along with physical picture of those staffs but we do not see it because we are aware of that fact personally when that is the common picture in all cases. 

          So, we are convinced that there was no fault on the part of the complainant.  Op acted illegally.  There is no clause in the policy document on the first part or 2^nd part as it is produced by the complainant that his policy was issued subject to encashment of the cheque rather it is noted received entire amount with note and it is printed matter.  Then under any circumstances op cannot cancel the present disputed policy when it is valid but if there is  fault that is on the part of the op, op shall have to receive such amount of Rs.10,947/- with such interest against that policy and the policy shall be treated as valid for the year 2011 – 12.

          In the light of the above observation and considering the entire pros and cons of the allegations of the complainant and the version of the op, we are confirmed that op’s office are very much unfair in handling the renewal of the policy and in so many cases it was incident and at the same time it is our personal knowledge of this Forum that such a situation is being faced by so many customers or consumers.  But there is none to look after this.  So, in the circumstances we are convinced to hold that the complainant is entitled to relief as prayed for.

Thus the complaint succeeds.

          Hence, it is

                                                               ORDERED

That the complaint be and the same is allowed on contest with cost of Rs.5,000/- against the ops.

          Ops are hereby directed to treat the policy bearing No.51010034100100203704 for the period from 28.03.2011 to 27.03.2012 as valid policy, but regarding bounced of cheque, op shall have to receive a fresh cheque for a sum of Rs.10,947/- with such interest and to that effect op shall have to send a written claim to the complainant and complainant shall have to deposit it positively within 15 days from the date of receipt of such letter from the op and op shall have to act accordingly within 15 days failing which op shall be imposed a penalty of Rs.25,000/- for adopting unfair trade practice and if op complies the order in that case that penalty shall not be charged.

          Op is directed to comply the order very strictly within 15 days in default the penal proceeding shall be started against them and in that case op shall have to pay a sum of Rs.10,000/- as penalty and even the penal action shall be started against them.