State Consumer Disputes Redressal Commission
United India Insu. Co. Ltd. vs Mohinder Pal Singh on 8 January, 2026
FA-572/2016 D.O.D:08.01.2026
UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH
IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL
COMMISSION
Date of Institution : 14.12.2016
Date of Reserving the order : 17.11.2025
Date of Decision : 08.01.2026
FIRST APPEAL NO.-572/2016
IN THE MATTER OF
UNITED INDIA INSURANCE CO. LTD.
DELHI REGIONAL OFFICE NO.1,
KANCHANJUNGA BUILDING, 8TH FLOOR,
BARAKHAMBHA ROAD,
NEW DELHI-110001
...APPELLANT
(Through: Ms. Nandita Saxena, Advocate
Mob:9654055026, 9555577906 &
Email: [email protected])
VERSUS
MR. MOHINDER PAL SINGH,
C-2/57, ASHOK VIHAR,
PHASE-II, DELHI-110052
......RESPONDENT
(Through: Mr. Ashish S. Kulshrestha,
Advocate
Mob: 9811166164
Email: [email protected])
CORAM:
HON'BLE JUSTICE SANGITA DHINGRA SEHGAL (PRESIDENT)
HON'BLE MS. PINKI, MEMBER (JUDICIAL)
Present : None for the appellant.
Mr Lalit Kumar, counsel for the respondent.
(Mob -9871654369
PER : HON'BLE PINKI, MEMBER (JUDICIAL)
DISMISSED PAGE 1 OF 10
FA-572/2016 D.O.D:08.01.2026
UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH
JUDGMENT
1. By this judgment, we shall dispose of the appeal filed by the Appellant against the impugned order dated 30.05.2016, passed by Consumer Disputes Redressal Forum, (District New Delhi), (hereinafter referred to as District Forum) , in Complaint Case no. CC-537/2011 titled 'Mohinder Pal Singh vs. United India Insurance Co. Ltd.', inter-alia praying for setting aside the order passed by the District Forum.
2. While the Appellant was Opposite Party before the District Forum and the Respondent was Complainant before the District Forum.
3. The facts of the case as per the District Forum, record are as under:
"The repudiation of the insurance claim of the complainant against Cashless Medical Health Policy by the OP has led the complainant file the present complaint under section 12 of The Consumer Protection Act, 1986 (in short Act) alleging, in brief, that the complainant obtained Cashless Medical Health Policy for the sum insured of Rs.6,00,000/- and paid an amount of Rs.16,976/- as premium to the OP and the OP issued a policy cover bearing number 042400/48/08/06/00000786 for insurance period 13/7/2008 to 12/7/2009. The complainant, his wife Mrs. Manjinder Kaur and daughter Ms. Guneet Kaur were covered under the policy. After a few days complainant also received identity cards from the OP. In the month of March 2009, the wife of complainant Mrs Manjinder Kaur was not well and approached the hospital for a checkup, but was refused cashless facility at the hospital. Despite the fact that the complainant had been informed at the time of taking policy that it was a cashless policy, the complainant had to bear surgery expenses in the sum of Rs. 2,86,126/- with Max Super Specialty Hospital while on account of Cashless Medical Health Insurance Policy in question the expenses should have been borne by the OP. The complaint has prayed for DISMISSED PAGE 2 OF 10 FA-572/2016 D.O.D:08.01.2026 UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH direction to the OP to pay the amount of the expenses incurred in surgery in the sum of Rs. 2,86,126/- and Rs.15,000/- for post-operative treatment, making the total amount in the sum of Rs. 3,01,126/- besides Rs.1,00,000/- towards mental harassment, pain, agony suffered by complainant despite having cashless policy from the OP. The complainant has also requested for any other or further order which this District Forum may deem fit and proper."
4. The District Forum after taking into consideration the material available on record passed the judgment dated 30.05.2016, whereby it held as follows:
"We have heard the complainant and have gone through the written arguments filed on behalf of the complainant, record of the case and relevant provisions of law. None appeared on behalf of the OP for addressing oral arguments nor any written arguments are filed on behalf of the OP. No authority is produced from either side.
The basic facts of this case are not in dispute. Undisputedly, the complainant obtained Cashless Medical Health Policy for the sum insured in the sum of Rs.600,000/- and paid an amount of Rs. 16,976/- as premium to the OP and the OP issued a policy cover bearing No. 042400/48/08/06/00000786 for insurance period 13/7/2008 to12/7/2009. It is not disputed that the wife of the complainant was covered under the said insurance policy and was admitted in Max Super Speciality Hospital and has undergone a procedure of Ortho Unilateral Total Knee Replacement at the hospital and was claiming cashless treatment for the same. The cashless request was turned down by M/S Vipul Medcorp, the Third-Party Administrator (TPA) of the OP. The expenses incurred in the surgery in the sum of Rs.286,126/- and Rs.15,000/- for post-operative treatment, making the total amount in the sum of Rs. 301,126/ are also not disputed.
DISMISSED PAGE 3 OF 10 FA-572/2016 D.O.D:08.01.2026
UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH In the backdrop of the above admitted position the plea of the OP about repudiation of the cashless claim of the complainant on the ground that the same was not permissible for the first two years of the policy as per Clause 4.3 of the terms and condition of the said policy is to be examined.
In M/s. Modern Insulators Ltd. v. Oriental Insurance Co. Ltd., (SC) : 2000 AIR (SC) 1014 : 2000(2) SCC 734 :
2000(2) Scale 25 : 2000(2) JT 289 : 2000(1) SCR 1076, relied on behalf of the complainant following observations were made:
"It is the fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and good faith forbids either party from non-disclosure of the facts which the parties know. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose all material facts in their knowledge since obligation of good faith applies to both equally."
In Modern Insulators Ltd.'s case (supra) as the terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the insured it was held that the insurance company cannot claim the benefit of the said exclusion clause.
In joint decision of honourable National Commission in Revision Petition. No. 186/2007 titled National Insurance Co. Ltd versus DP Jain and Revision Petition 187 of 2007 titled National Insurance Co. Ltd Versus Manjit Kumar decided on 15/5/2007 also relied upon by learned counsel for the complainant the above observations of honourable Apex Court in Modern Insulators Ltd's case (supra) were quoted and followed. It was also indicated therein that Regulation 3 of Insurance Regulatory and Development Authority (IRDA) (Protection of Policy Holders Interest), 2002 requires to be followed by the insurance company so that the terms of the insurance policy, do not operate DISMISSED PAGE 4 OF 10 FA-572/2016 D.O.D:08.01.2026 UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH harshly against the insured, and in favour of insurer. It was also observed that from the Regulations, as well as the law laid down by the Apex Court, it is clear that if Exclusion Clauses are not explained, they are not binding on the insured. These exclusion clauses are required to be ignored while considering the claim of the insured.
Coming to the facts of the present complaint the only document given to the complainant for the insurance cover. An insurance policy in question is proved by complainant as Exhibits CW 1/A and the three identity cards, copies of which are Exhibit CW 1/B (Colly). Although the terms and conditions and the Family Medicare Policy are filed by OP insurance company as Annexure OP/1 with the reply to the complainant and proved by the Assistant Manager of the Divisional Office-24 of the OP insurance company Sh. Manu Dev Rajput by his affidavit in evidence as Exhibit OP 1 is placed and clause 4.3 of the terms and condition of the policy for repudiation of the cashless claim of the complainant, but in the light of above observations of honourable Supreme Court in Modern Insulators Ltd's case (supra) and of honourable National Commission in DP Jain's case (supra) to have effective reliance on clause 4.3 of term conditions of the insurance policy for repudiation of the claim of the complainant the OP insurance company ought to have intimated the said term and condition to the complainant. There is no material on record to suggest that OP insurance company has acquainted the complainant of the said terms and conditions applicable to the insurance policy in question. The argument on behalf of complainant is that neither these terms and conditions were supplied by OP to complainant nor policy containing the same was issued and only two page policy document Exhibit CW 1/A was issued. Therefore, in view of Modern Insulators Ltd.'s case (supra) and DP Jain 's case (supra) we hold that repudiation of the cashless claim of the complainant by the OP insurance company through its TPA, amounts to deficiency in service on the part of OP insurance company, the complaint deserves to be allowed.
DISMISSED PAGE 5 OF 10 FA-572/2016 D.O.D:08.01.2026
UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH In view of the above discussion, we allow the complaint and direct the OP insurance company to make the payment in the sum of Rs. 301,126/- for expenses of knee replacement surgery and post-operative treatment along with simple interest at the rate of 10% per annum from the date of filing of the complaint till realisation of the said amount. However, since the reimbursement of medical expenses are being allowed along with interest, we feel that the claim of compensation in the sum of Rs. 1,00,000/- by complainant to be on quite higher side. Therefore, we further direct that OP insurance company shall make the payment of Rs. 25,000/- to the complainant towards mental agony and harassment and pain suffered by him and his family on account of repudiation of the cashless insurance claim of the complainant and also clarify that this amount is inclusive of litigation cost. In case the said amount of Rs. 25,000/- is not paid by the OP insurance company to the complainant within one month from the date of receipt of copy of this order, the same shall be recoverable by the complainant along with simple interest at the rate of 10% per annum from the date of this order till realisation of the said amount."
5. Aggrieved by the aforesaid order of the District Forum, the Appellant/Opposite Party has filed the present appeal, contending that the District Forum has erred in allowing the complaint despite the clear terms of the insurance policy. The respondent had taken a fresh policy, under which expenses for unilateral total knee replacement were expressly excluded during the first two years. Exclusion Clause 4.3 specifically bars payment for joint replacement due to degenerative conditions and age-related osteoarthritis within the initial two-year period.
6. The Ld. District Forum further misapplied the judgment in M/s Modern Insulators Ltd. v. Oriental Insurance Co. Ltd., (2000) 2 SCC
734. That decision turned on the fact that the insured had not been supplied with the policy terms containing the exclusion DISMISSED PAGE 6 OF 10 FA-572/2016 D.O.D:08.01.2026 UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH clause. In the present case, there was no pleading by the respondent alleging non-communication of the policy terms. On the contrary, the respondent themselves filed the complete family healthcare policy, including Exclusion Clause 4.3, as Annexure-A with the complaint, clearly establishing that the policy terms were duly communicated. Therefore, the issue of non-communication does not arise. Lastly, in the absence of any specific pleading regarding non-communication of the exclusion clause, the Ld. District Forum exceeded its jurisdiction by considering this issue at the stage of final arguments.
7. The respondent, on the other hand, denied all the allegations/grounds of the appeal and submitted that there is no error in the impugned order as the entire material available on record was properly scrutinized before passing the said order.
8. Written arguments have been filed by the parties and are on record.
9. We have carefully and thoroughly perused the material on record as well as the written submissions filed by the parties.
10. The only question for consideration before us is whether the District Forum erred in allowing the complaint filed by the respondent.
11. It is not disputed that the respondent obtained a Cashless Medical Health Policy for the period from 13.07.2008 to 12.07.2009 and that the respondent's wife underwent unilateral total knee replacement surgery during the validity of the policy. It is also not in dispute that the claim was denied on the basis of Exclusion Clause 4.3 of the policy, which excludes joint replacement surgeries arising from degenerative or age-related conditions during the first two years of the policy.
DISMISSED PAGE 7 OF 10 FA-572/2016 D.O.D:08.01.2026
UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH
12. The main argument of the appellant is that the District Forum ignored the clear exclusion contained in Clause 4.3 and wrongly held the insurer liable. The appellant is further submitted that the reliance placed on the judgment of the Hon'ble Supreme Court in M/s Modern Insulators Ltd. v. Oriental Insurance Co. Ltd. is incorrect, as the respondent was aware of the policy terms and the complete policy was already on record.
13. Per-contra, the respondent has submitted that only a cover note and identity cards were provided, and that the detailed terms and conditions, including the exclusion clause, were neither supplied nor explained. It is also the respondent's case that the plea of exclusion was raised at a later stage and cannot be enforced in the absence of proof that the policy terms were properly communicated.
14. The District Forum has rightly observed that Exhibit CW-1/A, which is the document issued to the respondent, is only a brief policy document and does not contain the detailed exclusion clauses relied upon by the appellant. The burden to prove that the exclusion clause formed part of the concluded contract and that it was duly communicated to the insured lies squarely on the insurer.
15. Although the appellant has filed the detailed terms and conditions along with its reply, there is no material on record to show that these terms and conditions were supplied to the respondent at the time of issuance of the policy or that the exclusion clause was specifically brought to the notice of the respondent. Mere filing of policy conditions during the proceedings does not, by itself, prove prior communication of such conditions to the insured.
16. The reliance placed by the District Forum on the judgment of the Hon'ble Supreme Court in M/s Modern Insulators Ltd. v. Oriental DISMISSED PAGE 8 OF 10 FA-572/2016 D.O.D:08.01.2026 UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH Insurance Co. Ltd. (2000) 2 SCC 734 is, therefore, well-founded. The law laid down therein clearly holds that exclusion clauses cannot be enforced unless they are duly disclosed and form part of the contract of insurance. The same principle has been reiterated by the Hon'ble National Commission in several decisions, including National Insurance Co. Ltd. v. D.P. Jain.
17. As regards the appellant's contention that there was no specific pleading regarding non-communication of the exclusion clause, we find no merit in the said argument. The entire case of the respondent before the District Forum was that the denial of cashless treatment was arbitrary and contrary to the assurance given at the time of issuance of the policy. Once the respondent asserted that only a limited policy document was supplied, it was for the insurer to prove otherwise, which it has failed to do.
18. We also find that the District Forum has given cogent reasons for holding the appellant guilty of deficiency in service. The denial of cashless facility, followed by repudiation of the claim, without establishing that the exclusion clause was duly communicated, cannot be sustained in law.
19. The quantum awarded by the District Forum towards reimbursement of medical expenses is based on admitted bills and has not been seriously disputed. The award of interest and a limited compensation of Rs. 25,000/- towards mental agony and litigation expenses is also reasonable and does not call for any interference.
20. In view of the aforesaid facts and circumstances, we are of the considered opinion that the District Forum has rightly allowed the complaint after proper appreciation of facts and evidence, and no ground is made out for interference in appeal. Consequently, we uphold the Judgment dated 30.05.2016 passed by the District DISMISSED PAGE 9 OF 10 FA-572/2016 D.O.D:08.01.2026 UNITED INDIA INSURANCE CO. LTD. VS. MOHINDER PAL SINGH Commission, New Delhi in Complaint Case No. CC-537/2011. Resultantly, the present appeal stands dismissed with no order as to costs.
21. Application(s) pending, if any, stand disposed of in terms of the aforesaid judgment.
22. FDR, if any be released in favour of the Respondent.
23. The judgment be uploaded forthwith on the website of the Commission for the perusal of the parties.
24. File be consigned to record room along with a copy of this Judgment.
(JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (PINKI) MEMBER (JUDICIAL) Pronounced on 08.01.2026 DISMISSED PAGE 10 OF 10