National Insurance Company Held Liable For Deficiency In Service For Denying Full Policy Amount To Complainant

Background

The Complainant purchased an Insurance Policy from National Insurance Company Ltd (Opposite Party) for the period between 28.11.2021 to 27.11.2022. On 07.10.2022, the Complainant was admitted in Rajagiri Hospital, Aluva for knee replacement and she was discharged on 12.10.2022. She spent Rs.2,26,117 on the treatment in the hospital and claimed the amount from the Opposite Party. However, as per the Complainant, only Rs.77063 were received by her even though the policy amount was Rs.280,000. This amount also included the cumulative bonus. Claiming the entitlement to receive the rest of the amount, the Complainant approached the Opposite Party stating that the Opposite Party was required to ensure the full payment of the policy amount.

The Opposite Party allegedly did not consider the grievance of the Complainant. Subsequently, the Complainant's husband sent a Legal Notice to the Opposite Party, which was replied to by them, however, with no proper justification.

Hence, the Complainant approached the District Consumer Disputes Redressal Commission Ernakulam seeking the full policy amount along with compensation for having suffered mental agony, pain and other difficulties because of the Opposite Party.

Findings of the Court

On perusal of the documents including policy card, discharge summary, legal notice and hospital bills produced by the Complainant, the Commission observed that the Complainant had purchased the policy from the Opposite Party to incur the expenses on treatment and as per the documents, the sum of the policy was Rs.2,00,000. Moreover, as per the documents, a bonus of Rs.40,000 was also to be added to the total amount. The Commission held that as per the documents, the actual amount to be paid to the Complainant was Rs.1,49,054. Furthermore, the Complainant was hospitalised for a period within the policy period, the Commission observed.

Since the Opposite Party did not appear, it was proceeded against Ex-Parte.

The Commission observed that the Opposite Party had denied the full claim of the Complainant on insufficient grounds.

Therefore, observing that the Opposite Party had not produced a proper justification for denying the claim of the Complainants, it was held that the Opposite Party was deficient in service.

The Commission further cited the decision in United India Insurance Co.Ltd Vs.Pushpalaya Printers (2004 KHC 795), wherein it was held, 'if there is any ambiguity or a term is capable of two possible interpretations, the one beneficial to the insured should be accepted.'

Accordingly, the Opposite Party was directed to pay the Complainant the balance claim amount of Rs.1,49,054 along with Rs.5000 as compensation for deficiency in service and Rs.5000 as litigation expenses.

Filed on: 13/12/2022

Decided on: 27/12/2024

Case Title: Daisy versus The Senior Divisional Manager, National Insurance Company Ltd

Counsel for Complainant: Adv. Jino Jose Kallarackal, M/s.Paulson M.J & Associates,

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