State Consumer Disputes Redressal Commission
Icici Prudential Life Insurance ... vs Bachan Singh Nagpal on 16 March, 2017
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
PANDRI, RAIPUR (C.G).
Appeal No.FA/2016/730
Instituted on : 30.12.2016
1) ICICI Prudential Life Insurance Co. Ltd.,
Through : Authorised Officer,
ICICI Pru Life Towers,
1089, Appa Sahab Marathe Marg, Prabhadevi,
Mumbai 400025
2) ICICI Prudential Life Insurance Co. Ltd.,
Through : Authorized Officer,
Nehru Nagar Chowk,
District & Tehsil - Durg (Chhattisgarh) ... Appellants/OPs
Vs.
Bachan Singh Nagpal,
S/o Late Basant Singh Nagpal,
Parekh Bhawan, Station Road,
Near State Bank of Indore,
District and Tehsil Durg (Chhattisgarh) ... Respondent /Complainant
PRESENT :
HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT
HON'BLE SHRI D.K. PODDAR, MEMBER
HON'BLE SHRI NARENDRA GUPTA, MEMBER
COUNSEL FOR THE PARTIES :
Shri Lokesh Kumar Singh, Advocate for the appellants.
Shri Nikhil Agrawal, Advocate for the respondent.
ORDER
DATED : 16/03/2017 PER :- HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT. This appeal is directed against the order dated 18.10.2016, passed by District Consumer Disputes Redressal Forum, Durg (C.G.) (henceforth "District Forum") in Complaint Case No.C.C./2015/81. By the impugned // 2 // order, the learned District Forum, has partly allowed the complaint of the complainant and directed that :-
(1) The O.P. No.1 & O.P. No.2 will jointly and severally pay, within a period of one month from the date of order, a sum of Rs.1,00,000/- (Rupees One Lakh), which is premium amount, to the complainant.
(2) The O.P. No.1 & O.P. No.2 will jointly and severally pay interest @ 12% p.a. from the date of filing of the complaint i.e. 03.02.2015 till date of payment.
(3) The O.P. No.1 & O.P. No.2 will jointly and severally pay a sum of Rs.2,00,000/- (Rupees Two Lakhs) towards compensation as they have given wrong information regarding the policy to the complainant.
(4) The O.P. No.1 & O.P. No.2 will jointly and severally pay a sum of Rs.2,00,000/- (Rs. Two Lakhs) towards compensation for mental agony to the complainant.
(5) The O.P. No.1 & O.P. No.2 will jointly and severally pay a sum of Rs.5,000/- Rupees Five Thousand) towards cost of litigation to the complainant.
2. Briefly stated the facts of the complaint of the complainant are that the complainant, Bachhan Singh Nagpal in order to cover himself and his family members, namely, Smt. Manmohan Kour Nagpal (Wife) and // 3 // Gagandeep Singh Nagpal (Son) has taken on Medical / Health Insurance Coverage from the OPs. The OPs have provided health coverage for sum of Rs.2,00,000/- to the complainant and his wife and son jointly under a Family Floater Policy in the name of ICICI Pru Health Saver (Impugned Policy), vide Policy No.13197411, dated 12.04.2010 for a term of 20 years, with the Annual Premium of Rs.25,000/- to be paid on yearly basis. The complainant on regular basis paid the Annual Premium amount of Rs.25,000/- on or before due date till Year 2014. The complainant paid the last premium amounting to Rs.25,000/- on 11.04.2014. That too much surprise and shock for the complainant, that the complainant received a letter, dated 29.04.2014 from OPs, wherein the OPs had "Foreclosed the impugned policy". The complainant objected the aforesaid decision of OPs vide his letter along with Grievance Letter both, dated 28.05.2014, which was received by O.P. No.1 on 31.05.2014. The OPs vide its letter, dated 22.05.2014 offered complainant to revive the impugned policy with new premium amount for both complainant and his wife without providing any just, reasonable and satisfactory reason. Moreover, OPs for the reason best known to them have deleted complainant's son from the impugned policy. Again complainant was confused and surprised when he received letter, dated 12.06.2014 from OPs wherein they refused to restore the impugned policy without giving just reasonable and satisfactory reason to the complainant. The aforesaid act of the OPs clearly falls under the ambit of deficiency of service for which they should be held liable and may also be // 4 // directed to compensate for the same. Hence, the complainant filed instant complaint before the District Forum and prayed for granting reliefs, as mentioned in the relief clause of the complaint.
3. The OPs filed their written statement and raised preliminary objections and averred that at the outset, the present complaint is time barred and liable to be dismissed on the ground of limitation as enshrined under Section 24A of the Consumer Protection Act, 1986 It is stated that present complaint is filed in respect of a policy bearing No.13197411 issued on 12.04.2010 which was issued on the basis of proposal form dated 05.01.2010. The said policy was issued and duly dispatched by the OPs on 03.05.2010 and received by the complainant on 07.05.2010 for which the free look period of 15 days ends on 21.05.2010. The complainant retained the policy document and did not return the same to the OPs for cancellation of the policy during the Free Look Period thereby implying that he had agreed to all the policy terms and conditions mentioned therein and accepting all the information filled in Proposal Form as true and correct. The cause of action, if any, has arisen on 07.05.2012 and it became barred by limitation on 07.05.2012 whereas present complaint is filed in the year 2015 i.e after expiry of almost 3 years period of limitation from the date of cause of action hence present complaint is time barred in respect of said insurance policy at the first stage and complaint is liable to be dismissed on the ground of limitation itself. The complaint has been filed // 5 // with an intent to claim relief which are in complete contravention of the terms and conditions of the contract of insurance between the parties, the complainant being fully aware about the said factual situation has prayed for reliefs in the present complaint which travels beyond express terms of insurance policy, thus, the present complaint is nothing but gross abuse of process of law and deserves to be dismissed with cost in favour of the OPs since the OPs are dragged into frivolous litigation without any justifiable reasons. It is trite law that courts including the Consumer Forums under the Consumer Protection Act, cannot grant relief beyond agreed terms and conditions of contract entered between the parties, the Consumer Forums will assume jurisdiction only if there is deficiency in services provided by service provider. In the present case, there is no deficiency in providing any insurance services to the complainant and as such no cause of action has arisen for the complainant to file the present complaint, hence the same is liable to be dismissed on this count alone. In the present case, the amount claimed by the complainant travels beyond terms of insurance policy, the position was abundantly made clear to the complainant. However, despite fully aware of the terms of contract, the complainant has filed the consumer complaint with ulterior motive and malafide intention to cause harassment and to extract money without just cause or valid reason and to cause prejudice to the OPs, which is a Company of high credibility and repute. In the present case, the OPs acted as per the mandate given to the complainant in proposal form and issued the insurance policy and took all // 6 // decision in conformity of insurance terms and conditions which is a concluded contract between the insurance company and life assured. It is settled law that the insurance terms have to construe strictly and no relief which travels beyond the terms of the insurance policy can be granted, hence no case for deficiency in service is made out in this case as there is no breach on the part of the insurance company. The decision of the Company to release the payment of Rs.7,897.42 under the foreclosure of the policy was strictly in accordance with the policy terms and conditions. The allegations of the complainant are highly disputed and the said aspect can be properly adjudicated only after taking detailed evidence of the parties and therefore, the present complaint cannot be tried before the District Forum, where complaints are adjudicated through Summary Trial only, hence the present complaint involving intricate question of law and fact need to be dismissed by relegating the parties to the ordinary proceedings. The complaint being frivolous and vexatious is liable to be dismissed under Section 26 of the Consumer Protection Act, 1986 as the complainant has failed to make out a case of "Deficiency of Service" as alleged or otherwise within the meaning of the Consumer Protection Act, 1986, hence the present complaint is not maintainable. As per Clause 6(2) and 4(1) of the Insurance Regulatory and Development Authority (Protection of Policyholder's Interest) Regulations, 2002, the Life Assured received policy documents namely policy terms and conditions along with a letter stating the "Free Look Period" provision with a copy of the proposal form. The life // 7 // assured had not approached the OPs within said period of 15 days. The complainant made no attempt to contact the OPs for objecting any terms or conditions of the insurance policy or for providing / updating correct medical history to the OPs. It is evident from such conduct of the life assured that the terms and conditions of the policy were duly understood by him as he is well literate, the answers in the proposal form were true, correct and agreeable to him. Since the life assured never approached the Company with any discrepancy relating to answers in the proposal form or policy features within the mandate period of 15 days of Free look period, the policy continued with liability on company to bear the risk cover. The OPs were in receipt of duly signed and filled in proposal form, the complainant for issuance of insurance policy, as per details contained in the said form. The OPs on believing the information given by the complainant in proposal form to be true and correct in all aspects and as per underwriting norms of the OPs issued policy in favour of the complainant, details of which are as mentioned below :-
Policy Details.
Application Number HS02114517 Policy Number 13197411 Policy Plan ICICI Pru Health Saver U56. Owner / Proposer Bachan Singh Nagpal. DOB 21/11/1955
Name and age of Members covered Mr. Bachan Singh Nagpal (Family Floater) Age 55 years Mrs.Manmohan Kour Nagpal Age 50 years Gagandeep Singh Nagpal Age 23 years // 8 // Sum Assured Rs.2,00,000/-
Proposal Date 5/1/2010 Risk Commencement Date 12/4/2010 Policy received date 7/5/2010 Premium Rs.25,000/ Total premium paid Rs.1,00,000/- Premium frequency Annual Paid to date 12/4/2014 Policy Dispatch Date 3/5/2010
Based on duly filled and signed proposal form received from the complainant, the policy bearing number 1317411 was issued on 12.4.2010 with a yearly premium of Rs.25,000/- under ICICI Pru Health Saver Plan. In accordance to Clause 6(2) & 4(1) of the Insurance Regulatory and Development Authority (Protection of Policyholder's Interest) Regulations, 2002, the OPs had sent the Policy Documents to the communication address mentioned in the proposal form, stating the policy term and conditions and a forwarding letter stating the Free look provision along with a copy of proposal form on 03.05.2010 and the same was duly received by the complainant on 07.05.2010. The complainant had ample opportunity to go through and understand the terms and conditions of the subject policy including the clause related to exclusion to hospitalization benefits. It is not the case of the complainant that he was not aware of the policy terms and conditions. The complainant retained the policy documents and did not approach the OPs with any discrepancies regarding policy terms and conditions, hence it is assumed that he must have definitely read the proposal form and terms & conditions of the policy carefully before investing amount in the subject policy thereby implying that he had agreed // 9 // to all the TERMS & CONDITIONS of the policy including the provisions of family floater cover benefits and age parameters. Hence, the subject policy continued. The said facts categorically establishes that complainant is a person with sound and prudential understanding and having capability of decision making by his own.. The policy was issued on the basis of the information and declaration made by the complainant in the proposal form duly signed by him. The complainant has not disputed his signature in the proposal form. It is well settled principle that if any person signs any document, it is presumed that he has signed after reading it properly and understanding the same. As per IRDA rules, insurance agents are provided with all material information in respect of a proposed cover to the life assured. In present case also complainant had on the basis of material information in respect of a proposed cover to decide on the best cover that would be in his interest further the complainant was made fully aware about the feature of product and complainant had after thoroughly understanding the features, terms and conditions of the policy had signed subject proposal form and after evaluating the information and declaration provided in the said proposal form. For procuring subject policy, the complainant had availed the services of an independent Insurance Agent namely "Ranjan Pandey". The complainant grossly and willfully had failed to make insurance agent a party to the proceedings neither complainant had impleaded the said agent as a necessary party. Hence, there is non- joinder of necessary party as there is no allegation in the complaint to show // 10 // that any act attributed on OPs amounts to any deficiency of service or negligence which gives any cause of action to the complainant to file the complaint. Under the policy the Life Assured and his family his wife and son were covered. As per Clause 1 (11) the children are covered only till they turn 25 years of age. The OPs were well within their limit to remove the name of the son who was of 23 years at the time of proposal in year 2010 and thereafter on attaining the age of 25 years, his coverage was removed from the policy as per the terms and conditions of the policy. The policy of the complainant got foreclosed as per clause 26 of the policy terms and conditions. The complainant had requested the OPs to revive the said policy and the complainant had agreed to pay premium at revised rate. The company vide letter dated 17.04.2014 informed the complainant that the complainant and his wife will have to undergo fresh medical examination for the Company to consider his revival request. The same is subject to Clause 9 of the policy terms and conditions. As per the medical reports, due to adverse ECG finding in the case of the complainant's wife the revival was postponed. In the case of the complainant i.e. the primary life the premium was revised as the complainant was suffering from hypertension. The same was informed to the complainant vide letter dated 22.05.2014. The complainant has not consent to the same, hence the OPs could not revive the policy of the complainant. The applicability of provisions of Clause 9 for revival of policy was already explained to the complainant by the OPs vide their letter dated 17.04.2014. The OPs had // 11 // again issued a letter dated 02.05.201 requesting Life Assured to fulfill additional requirement of medical check-up of his wife Mrs. Manmohan Kour, for revival and reinstatement of subject policy. As per the medical reports due to adverse ECG findings in the case of the complainant's wife revival was postponed. In the case of the complainant i.e. the primary life the premium was revised as the complainant was suffering from hypertension. The same was informed to the complainant vide letter dated 22.05.2014. On receiving the personal health declaration forms with supporting revised medical documents and reports, OPs had revised the premium amount as per applicable terms of the policy. It was mentioned in the acceptance letter that Life Assured is required to send back the enclosed consent within 30 days of receipt of acceptance letter. The complainant has not consented the same, hence the OPs could not revive the policy of the complainant. The applicability of revised premium on reinstatement of the policy was already well explained to the complainant on 07.05.2010 when he had received policy documents with terms and conditions for the first time whereas complainant failed to avail the free look period for cancellation of the policy. OPs had duly communicated the reason for revised premium and deletion of son of Life Assured from the subject policy on attainment of his age of 25 years vide OPs replies to the complainant in year 2014. The deletion of son of the Life Assured was done solely in accordance with the policy terms and conditions. Also the revival conditions are stated in the policy terms and conditions. The detailed terms // 12 // and conditions were within the knowledge of the complainant right from the date he had received the policy documents. The complaint of mis-
selling is wholly concocted and the complainant is merely perusing the same to extract money from the OPs. There is no allegation in the complaint to show that any act attributed on the part of OPs amounts to any deficiency in service of negligence. The complainant has merely made this complaint to usurp unjust monies from the OPs and the same is liable to be dismissed. In view of foregoing factual submission and documents produced on record, it is established that complaint is merely a sham for gaining undue advantage from the OPs, hence no question arises for applicability of territorial jurisdiction of the District Forum. The present complaint is hopelessly time barred under Section 24A of the Consumer Protection Act, 1986. The complainant had come up with a concocted story to exert pressure on OPs whereas OPs had duly acted within the ambit of terms and conditions of the subject policy. The complainant himself had not acted in good faith with respect to subject policy as well as present complaint and has approached the District Forum with unclean hands with suppression of material facts from District Forum in his complaint. There is no deficiency in services by OPs. The said policy of the complainant is a unit lined policy. Investment is done with a view to gain advantage from speculation activities and hence the complainant does not fall within the category of consumer as investment in policy was done to take advantage // 13 // of speculative activities. Hence the present complaint deserves to be dismissed.
4. The complainant has filed documents. Annexure A-1 is ICICI Pru Health Saver Policy, Annexure A-2 is ICICU Pru Health Saver Policy (True Copy), Annexure A-3 is Premium payment receipt, Annexure A-4 is letter sent by the OPs to the complainant, Annexure A-5 is Grievance Letter and Acknowledgment dated 31.05.2014, Annexure A-6 is letter dated 22.05.2014 sent by the OPs to the complainant, Annexure A-7 is letter dated 12.06.2014 sent by the OPs to the complainant.
5. The OPs have filed documents. Annexure NA-1 is copy of proposal form, Annexure NA-2 copy of terms and conditions, Annexure NA-3 is copy of signed EBI, Annexure NA-4 is copy of OPs' letter dated 02.05.2014, Annexure NA-5 is copy of OPs' letter dated 22.05.2014, copy of OPs reply letter dated 12.06.2014.
6. Shri Lokesh Kumar Singh, learned counsel appearing for the appellants (OPs) has argued that the impugned order passed by the District Forum, is erroneous and is liable to be set aside. The policy was issued on 12.04.2010 and the respondent (complainant) received the policy on 07.05.2010,for which free look period of 15 days ends on 21.05.2010. If all information filled in the proposal form are accepted as true and correct, then cause of action, if any, has arisen on 07.05.2012, whereas the instant // 14 // complaint has been filed on 03.02.2015, therefore, the complaint is barred by time and is liable to be dismissed. The respondent (complainant) filled proposal form, which was duly signed by him and the appellants (OPs) issued policy in favour of the respondent (complainant). The terms and conditions of the insurance policy were duly explained to the respondent (complainant) and the respondent (complainant) retained the policy documents with him and did not approach the appellants (OPs) with any discrepancies regarding policy terms and conditions, therefore, it must be presumed that the respondent (complainant) must have definitely read the proposal form and the terms and conditions of the policy carefully and then he signed it, therefore, terms and conditions of the policy are binding upon the respondent (complainant). According to the Clause 26 of the policy terms and conditions if premiums have been paid to three full policy years and after three policy years have elapsed since inception, notice will be given to the policyholder well before the total Fund Value reaches 110% of one full year's premium. Thereafter if the Fund Value reaches or falls below 110% of one full year's premium, the policy will be foreclosed. In the instant case, the fund value reached below 110% of one full year's premium, therefore, the notice was given to the respondent (complainant) for foreclosure of the policy and the respondent (complainant) requested the appellants (OPs) to revive the said policy. The appellants (OPs) vide letter dated 17.04.2014 informed the respondent (complainant) that the respondent (complainant) and his wife will have to undergo fresh medical // 15 // examination for the Company to consider his revival request. The appellants (OPs) also informed the respondent (complainant) regarding the changed premium, which was accepted by the respondent (complainant), but learned District Forum has failed to appreciate the terms and conditions of the policy. The relief granted by the District Forum to the respondent (complainant) are against the express provisions of the policy terms and conditions as well as in violation of the provisions of the Insurance Act, 1938. If the revised premium was started according to the terms and conditions, which is binding on the respondent (complainant) and the respondent (complainant) had an option to return the insurance policy during cooling off period, if he was not specifically satisfied with the policy conditions, but the respondent (complainant) did not return the policy. It shows that he accepted the revised premium. Therefore, the impugned order passed by the District Forum, is erroneous and is liable to be set aside. The appeal be allowed and complaint be dismissed. He placed reliance on Revision Petition No.3271 of 2013 Harish Kumar Chadha Vs. The Manager, M/s Bajaj Allianz Life Insurance Co. Ltd. & Others, decided by Hon'ble National Commission vide order dated 07.10.2013 (also reported in I (2014) CPJ 188 (NC); Life Insurance Corpn. of India & Ors. Vs. Siba Prasad Dash (Dr.) & Ors. IV (2008) CPJ 156 (NC); Appeal (Civil) 8701 of 1997 - Ravneet Singh Bagga Vs. KLM Royal Dutch Airlines and Another, decided by Hon'ble Supreme Court vide order dated 02.11.1999 (also reported in (2000) 1 Supreme Court Cases 66); Revision // 16 // Petition No.634 of 2012 Shrikant Murlidhar Apte Vs. Life Insurance Corporation of India & Others, decided by Hon'ble National Commission, vide order dated 02.05.2013; Revision Petition No.2870 of 2012 - Mohan Lal Benal Vs. M/s. ICICI Prudential Life Insurance Co. Ltd. and another, decided by Hon'ble National Commission vide order dated 16.10.2012; Sitaram Motilal Kalal Vs. Santanuprasad Jaishankar Bhatt, 1966 AIR 1697, 1966 SCR (3) 727; Civil Appeal No.1557 of 2004 - Export Credit Guarantee Corporation of India Ltd. Vs. M/s Garg Sons International, decided by Hon'ble Supreme Court vide order dated 17.01.2013 (also reported in II (2013) CPJ 1 (SC); General Assurance Society Ltd. Vs. Chandumull Jain & another, AIR 1966 Supreme Court 1644, 1966 SCR (3) 500; Revision Petition No.211 of 2009 - Reliance Life Insurance Co. Ltd. & another Vs. Madhvacharya, decided by Hon'ble National Commission vide order dated 02.02.2010; Appeal (Civil) 6277 of 2004 - United India Insurance Co. Ltd. Vs. M/s Harchand Rai Chandan Lal , decided by Hon'ble Supreme Court on 24.09.2004 (also reported in 2005 (1) CPR 64 (SC); Civil Appeal No.2080 of 2002 - Vikram Greentech (I) Ltd. & Anr. Vs. New India Assurance Co. Ltd., decided by Hon'ble Supreme Court vide order dated 01.04.2009; Civil Appeal No.1375 of 2003
- M/s Suraj Mal Ram Niwas Oil Mills (P.) Ltd. Vs. United India Insurance Co. Ltd., decided by Hon'ble Supreme Court on 08.10.2010 ( also reported in IV (2010) CPJ 38 (SC).
// 17 //
7. Shri Nikhil Agrawal, learned counsel appearing for the respondent (complainant) has argued the complaint of the respondent (complainant) is within limitation. The respondent (complainant) obtained Family Floater Policy in the name of ICICI Pru Health Saver for himself, his wife and his vide policy No.13197411 dated 12.04.2010 for a term of 20 years with the annual premium of Rs.25,000/- to be paid on yearly basis. The respondent (complainant) has paid the Annual Premium amount of Rs.25,000/- on regular basis till year 2014. The respondent (complainant) paid the last premium amounting to Rs.25,000/- on 11.04.2014. On 29.04.2014, the appellants (OPs) sent a letter to the respondent (complainant) regarding foreclosure of the impugned policy. The respondent (complainant) objected to the above decision of the appellants (OPs) and sent his grievance letter dated 28.05.2014 to the appellants (OPs). The appellants (OPs) again sent letter dated 22.05.2014 to the respondent (complainant) for the reasons only known to them offered to revive the impugned policy of the respondent (complainant) with new and separate premium for his wife and himself without providing any just, reasonable and satisfactory reason. The appellant (OPs) have not provided copy of terms and conditions of the insurance company along with policy documents to the respondent (complainant) He further argued that the respondent (complainant) is a "consumer and the dispute between the parties comes within purview of consumer dispute. The appellants (OPs) have violated the terms and conditions of the insurance policy and wrongly referred Clause 26 of the // 18 // terms and conditions of the Insurance Policy regarding Foreclosure of the Policy. The respondent (complainant) deposited the premium amount of the insurance policy till April, 2014 but the appellants (OPs) illegally foreclosed the policy. The respondent (complainant) never requested the appellants (OPs) for revival of the policy. The appellants (OPs) committed deficiency in service and unfair trade practice. The impugned order passed by the District Forum is just and proper and does not suffer from any infirmity, irregularity or illegality. The appeal is liable to be dismissed.
8. We have heard learned counsel appearing for both the parties and have also perused the record of the District Forum as well as the impugned order.
9. The appellants (OPs) have raised preliminary objection that the complaint is barred by time. The above contention of the appellants (OP) is not acceptable. The respondent (complainant) deposited the fourth premium on 11.04.2014 and the appellant (OPs) sent letter to the respondent (complainant) on 29.04.2014 and thereafter on 22.05.2014 and 12.06.2014, therefore, the cause of action was accrued to the respondent (complainant) on 12.06.2014 whereas the respondent (complainant) has filed the instant complaint on 03.02.2015, hence the complaint is within limitation.
10. The policy is a legal contract between the Policy holder and Insurance Company and parties to the said contract are bound by its terms // 19 // and conditions. The terms of a policy are in the nature of a contract and their interpretation has to be made in accordance with a strict construction of the contract. Thus, the words in an insurance contract must be given paramount importance and interpreted as expressed without any addition, deletion or substitution.
11. In M/s. BHS Industries Vs. Export Credit Guarantee Corp. & Anr. III (2015) CPJ 1 (SC) = (2017) (1) CPR 18 (SC), Hon'ble Supreme Court, has observed that :-
"9. At the outset, it may be stated that contracts of insurance are contracts of uberimma fides and every material fact is required to be disclosed. In United India Insurance Co. Ltd. v. M.K.J. Corpn., (1996) 6 SCC 428 a two Judge Bench has observed :-
"It is fundamental principle of Insurance law that utmost good faith must be observed by the contracting parties. Good faith forbids either party from concealing (non- disclosure) what he privately know, 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."
Regard being had to these principles, the authorities cited by Mr. Gupta, learned senior counsel for the appellant are to be seen.
10. In Amalgamated Electricity Co. v. Ajmer Municipality, (1969) 2 SCR 430 = AIR 1969 SC 227 though in a different context, it has been held that :-
// 20 // "In construing the true nature of the contract entered into between the parties, the contract has to be read as a whole and if so read it is clear that what the plaintiff undertook was to pump water from the wells in question and not to supply any electrical energy. Hence, we are in agreement with the learned Judges of the High Court that the plaintiff's case in this regard should fail."
11. In Bay Berry Apartments (P.) Ltd. and Another v. Shobha and others, (2006) 13 SCC 737 the Court has observed that in construing a document, the Court cannot assign any other meaning; and a document as is well known must be construed in its entirety.
12. In Polymer India (P) Ltd. and Another v. National Insurance Co. Ltd. and Others, (2005) 9 SCC 174, this Court has held thus :-
"19. In this connection, a reference may be made to a series of decisions of this Court wherein it has been held that it is the duty of the court to interpret the document of contract as was understood between the parties. In the case of General Assurance Society Ltd. v. Chandumull Jain, (1996) 3 SCR 500 : AIR 1966 SC 1644 it was observed as under :
"In interpreting documents relating to contract of insurance, the duty of the court is to interpret the words in which the contract is expressed by the parties, because it is not for the court to make a new contract, however reasonable, if the parties have not made it themselves."
20. Similarly, in the case of Oriental Insurance Co. Ltd. v.
Samayanallur Primary Agricultural Coop. Bank, (1999) 8 SCC 543, it was observed as under :-
// 21 // "The insurance policy has to be construed having reference only to the stipulations contained in it and no artificial far- fetched meaning could be given to the words appearing in it."
21. Therefore, the terms of the contract have to be construed strictly without altering the nature of the contract as it may affect the interest of the parties adversely."
12. In Export Credit Guarantee Corpn. of India Ltd. vs. M/s Garg Sons International (Supra), Hon'ble Supreme Court has observed thus :-
"9. 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....."
13. In United India Insurance Company Ltd. vs. M/s Harchand Rai Chandan Lal, (Supra), Hon'ble Supreme Court has observed thus :-
"6. The terms of the policy have to be construed as it is and we cannot add or subtract something. Howsoever liberally we may construe the policy but we cannot take liberalism to the extent of substituting the words which are not intended. It is true that in common parlance the term 'burglary' would mean theft but it has to be proceeded with force of violence. If the element of force and violence is not preset then the insured cannot claim compensation against theft from the insurance company. (Para 6). It is not open to interpret the expression appearing in policy in terms of common law; but it has to give meaning to the expression reproduced the terms of the policy as also the definition of burglary and / or housebreaking as defined in the policy."
// 22 //
14. In Deokar Exports Pvt. Ltd. vs. New India Assurance Company Ltd. , I (2009) CPJ 6 (SC), Hon'ble Supreme Court has observed thus :-
"11. A policy of insurance is a contract based on an offer (proposal) and an acceptance. The appellant made a proposal. The respondent accepted the proposal with a modification. Therefore, it was a counter proposal, in which event three would have been no contract. The second was to accept either expressly or impliedly, the counter proposal of the respondent (that is respondent's acceptance with modification) which would result in a concluded contract in terms of the counter proposal. The third was to make a counter proposal to the counter proposal of the respondent in which event there would have been no concluded contract unless the respondent agreed to such counter proposal. But the appellant definitely did not have the fourth choice of propounding a concluded contract with a modification neither proposed nor agreed to by either party."
15. In the instant case, the respondent (complainant) has pleaded that the appellants (OPs) have provided health coverage for sum of Rs.2,00,000/- to the respondent (complainant), his wife and son jointly under a Family Floater Policy in the name of I.C.I.C.I. Pru Health Saver vide policy No.13197411 dated 12.04.2010 for a term of 20 years with the annual premium of Rs.25,000/-. The respondent (complainant) has further pleaded that he paid the annual premium amount of Rs.25,000/- regularly and the last premium amounting to Rs.25,000/- was paid on 11.04.2014. The respondent (complainant) has filed copy of the insurance policy. In the // 23 // insurance policy Annexure A-1(a) under the head Customer Information Sheet, it is mentioned thus :-
S.No. Table Description Refer to
Policy Clause
Number
8. Renewal Under Health Savings Benefit, the Clause 3B
Conditions cover is for whole life.
Under Hospitalisation Insurance Clause 3A
Benefit, the cover ceases at 75
years.
16. In Annexure A(b), the premium amount Rs.25,000/- which shall be payable yearly. In the Policy Certificate, the category of policy is mentioned as Medical and date of birth of the primary insured Bachan Singh Nagpal is mentioned as 21.01.1955. The respondent (complainant) has also filed First Premium Receipt and Statement of Account (annexed at page No.12 of the record of the District Forum). According to above document, the respondent (complainant) deposited Rs.25,000/- on 05.01.2010. Annexure A03 is Premium Deposit Receipt. According to the above document, the respondent (complainant) paid premium amount of Rs.25,000/- on 11.04.2014. It appears that the respondent (complainant) deposited Rs.25,000/- towards fourth premium on 11.04.2014.
17. The Clause 26 of terms and conditions of the Policy runs thus :-
"26. Foreclosure of the Policy : If premiums have been paid for three full policy years and after three policy years have elapsed since inception, notice will be given to the policyholder well before the total fund value reaches // 24 // 110% of one full year's premium. Thereafter if the fund value reaches or falls below 110% of one full year's premium, the policy will be foreclosed. The foreclosure Fund Value (Fund Value as on foreclosure date based on that day's NAV) can be claimed within the next five years as Health Savings Benefit subject to a maximum of 50% of the foreclosed fund value. The maximum aggregate benefit that can be claimed over the five years is limited to the foreclosed Fund Value. On death of the Primary Insured during this period, foreclosed Fund Value minus any Health Savings Benefit paid during the period will be payable to the nominee. The amount paid out on death of the Primary Insured may be taxable in the hands of the nominee as per the prevailing tax regulations at that time. No other benefits shall be payable."
18. From bare perusal of the Clause 26 of the terms and conditions of the insurance policy, it appears that if premiums have been paid for three full policy years and after three policy years have elapsed since inception, notice will be given to the policyholder well before the total fund value reaches 110% of one full year's premium.
19. In the instant case, the respondent (complainant) deposited Rs.25,000/- towards fourth premium on 11.04.2014. The respondent (complainant) has filed document Annexure A-4, which is letter dated 29th April, 2014 sent by the appellants (OPs) to the respondent (complainant).
20. According to the above letter, the intimation was given by the appellants (OPs) to the respondent (complainant) on 29.04.2014 i.e. after receiving amount of fourth premium from the respondent (complainant). The respondent (complainant) sent letter to the appellant (OPs) then the // 25 // appellants (OPs) again sent letters to the respondent (complainant) on 22.05.2014 (Annexure A-6) and 12.06.2014 (Annexure A-7).
21. The appellants (OPs) pleaded that the Insurance Company was well within limit to remove the name of the son, who was of 23 year at the time of proposal in the year 2010 and thereafter on attaining the age of 25 years, his coverage was removed from the policy as per terms and conditions of the policy. From bare perusal of the above averment of the appellants (OPs), it appears that without giving notice to the respondent (complainant), the name of the son of the respondent (complainant) was removed from the policy. According to the terms and conditions of the insurance policy, notice/intimation was required to be given by the appellants (OPs) to the respondent (complainant) before removing name of son of the respondent (complainant) from the policy, but no such notice / intimation was given by the appellants (OPs) to the respondent (complainant). According to the appellants(OPs), the respondent (complainant) had requested the appellants (OPs) to revive the said policy and the respondent (complainant) had agreed to pay premium at revised rate, but the appellants (OPs) have not filed letter of the respondent (complainant) in which he agreed to pay premium as revised rate.
22. It appears that the respondent (complainant) did not accept the proposal sent by the appellants (OPs). The appellants (OPs) did not send notice to the respondent (complainant) according to the terms and // 26 // conditions of the insurance policy. The appellants (OPs) received a sum of Rs.25,000/- towards fourth premium amount on 11.04.2014.
23. It appears that prior to 11.04.2014, no notice was sent by the appellants (OPs) to the respondent (complainant). In letter dated 29.04.2014 sent by the appellants (OPs) to the respondent (complainant), it is mentioned thus :-
"The policy that you have purchased from us is ICICI Pru Health Saver, which is designed to give you two benefits:
1) Comprehensive hospitalization cover for you and your family
2) Health Savings Benefit - Reimbursement of medical expenses by building a health fund.
We must inform you that currently the fund value in your policy is less than 110% of your annual premium of Rs.25,000/-.
As per the terms of the policy, if the fund value is equal to or lesser than 110% of your annual premium the policy gets "foreclosed". On foreclosure, you can avail of only Health Savings Benefit. However, you lose the Hospitalisation cover.
What can you do now ?
1. You can get back your policy benefits by paying a revised annual premium of Rs.44,000/- at your nearest ICICI Prudential branch on or before 30-May-2014.
2. Alternatively, You can avail the Health Savings benefit of Rs.28,384.89 against medical expenses incurred by you, by submitting the enclosed declaration at the nearest branch within 30-Jun-2014.
// 27 // On receipt of the enclosed declaration, the amount shall be credited to your account.
Please note that we may ask you to furnish the bills/proofs for medical expenses."
24. The respondent (complainant) sent letter dated 28.05.2014 to the appellants (OPs), which was received by the appellants (OPs) on 31.05.2014, in which it is mentioned thus :-
"We have deposited Rs.25,000/- on 11.04.2014 till that time no such information was given to us and the said is kept as suspense as informed. We are very disappointed on this stage that how can you cancel the policy without any written communication."
25. In letter dated 22.05.2014 (Annexure A-6), which was sent by the appellants (OPs) to the respondent (complainant), it is mentioned thus :-
"We are keen to revive your policy with the above revision and request you to sign in the Consent Box (provided at the end of this letter) and send us a copy, within 30 days from the date of receipt of this letter."
26. Looking to the letter dated 22.05.2014 (Annexure A-6) sent by the appellants (OPs) to the respondent (complainant), it appears that the respondent (complainant) has not requested the appellants (OPs) for reinstatement. Looking to the letters sent by the appellants (OPs) to the respondent (complainant), it appears that the appellants (OPs) pressurized the respondent (complainant) for renewal of the policy, therefore, the learned District Forum has rightly directed the appellants (OPs) to refund a // 28 // sum of Rs.1,00,000/-, which is premium amount. The District Forum has rightly awarded interest @ 12% p.a. from the date of filing of the complaint till date of payment on Rs.1,00,000/- to the respondent (complainant).
27. So far the judgments cited by appellants (OPs) is concerned, they are quite distinguishable from the facts of the instant case. In Harish Kumar Chadha Vs. Bajaj Allianz Life Insurance Co. Ltd. & Ors. (Supra), second premium for all three policies could not be paid and payment of premium discontinued. In the instant the premium of the policy has been duly paid by the respondent (complainant), therefore, the above judgment is quite distinguishable from the facts of the instant case. So far as other judgments cited by the appellants (OPs) are concerned, they are also not helpful to the appellants (OPs).
28. Learned District Forum has awarded a sum of Rs.2,00,000/- (Rupees Two Lakhs) towards compensation because the appellants (OPs) gave wrong information regarding the policy to the respondent (complainant). The above amount has been wrongly awarded by the District Forum to the respondent (complainant). The respondent (complainant) is not entitled to get compensation for wrong information regarding the policy given to him by the appellants (OPs).
29. So far as award of Rs.2,00,000/- towards compensation for mental agony is concerned, the District Forum had already directed the appellants // 29 // (OPs) to pay interest @ 12% p.a. on Rs.1,00,000/- from the date of filing of the complaint till date of payment, therefore, Rs.2,00,000/- towards compensation for mental agony, is on higher side. It is just and proper to award a sum of Rs.50,000/- (Rupees Fifty Thousand) to the respondent (complainant) towards compensation for mental agony. So far as award of Rs.5,000/- towards cost of litigation is concerned, the same is just and proper.
30. Therefore the appeal filed by the appellants (OPs) is partly allowed. The Clause (1) (2) and (5) of para 26 of the impugned order, are affirmed. So far as Clause (3) of para 26 of the impugned order regarding award of compensation of Rs.2,00,000/- for giving wrong information regarding policy is concerned, the same, is set aside. So far as Clause (4) of para 26 of the impugned order regarding award of Rs.2,00,000/- towards compensation for mental agony is concerned, it is modified and it is directed that the appellants (OPs) will jointly and severally pay a sum of Rs.50,000/- (Rupees Fifty Thousand) to the respondent (complainant) instead of Rs.2,00,000/- towards compensation for mental agony.
(Justice R.S. Sharma) (D.K. Poddar) (Narendra Gupta)
President Member Member
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