The main legal point established is the duty of the insurance company to act fairly and reasonably, including the duty to renew the policy and the implications of exclusions under the policy.

S.K.Katriar, J.

1. This writ petition has been preferred for a direction to the respondent Oriental Insurance Company Limited to renew the mediclaim policy of Anjani Kishore Prasad deceased (hereinafter referred to as the Insured) with effect from 4.12.2004 till the date of his death on 5.5.2006.

2. The arguments in the writ petition had concluded on 19.4.2006 and the judgment had been reserved for consideration. Shortly before the judgment could be pronounced, the insured died on 5.5.2006, whose heirs have been brought on record by order dated 19.05.2006. Petitioner No. 1 is the widow of the insured, and petitioner Nos. 2 to 4 are that r daughters.

3. According to the writ petition, the insured had obtained a mediclaim policy covering the period 4.12.1996 to 3.12.1997, Photo copies of the money receipt dated 4.12.1996, showing payment of the premium amount, and that of the policy described as Hospitalisation and Domiciliary Hospitalisation Benefit Policy, are marked Annexure-1 series. The policy was renewed year after year till 3.12.2004. It is further stated in the writ petition that one P.N. Opadhyay, the Company Agent, was regularly collecting the premium amount, and the original policy was accordingly renewed without the necessity of issuing a fresh document. In April 2003, the insured was diagnosed for Non Hodgkins Lymphoma of the abdomen, i.e. cancer of the abdomen. The insured informed the company of his illness on 8.4.2003. He was administered chemotherapy and radiotherapy and raised medical claim for reimbursement which was settled and paid on 11.2.2004. in the meantime, the policy was renewed for the period 4.12.2003 to 3.12.2004, being the last one. It is further stated in the writ petition that he was waiting for arrival of the Company Agent to collect the premium for renewal of the policy for the following period, namely, 4.12.2004 to 3.12.2005, but did not turn up. The insured, therefore, wrote his letter dated 14.5.2005 (Annexure-2) that P.N. Opadhyay, the Agent, had informed that the policy cannot be renewed as per higher level instruction. He, therefore, requested the Divisional Manager of the Company to renew the policy with retrospective effect. The insured did not receive any reply and he, therefore, sent his reminder dated 13.7.2005. The company did not send any reply to the same leading to the present writ petition.

4. The respondents have placed on record their counter affidavit and have opposed the writ petition, It is stated in the counter affidavit that sec. 24 of the General Insurance Business (Nationalisation) Act 1972 (hereinafter referred to as the 1972 Act) provided that the Corporation and acquiring companies including the respondent company shall have exclusive privilege of carrying on general insurance business in India. The Insurance Regulatory and Development Authority Act 1999 (hereinafter referred to as the 1999 Act) was enacted by the Parliament for establishment of authority to protect the interest of holders of insurance policies to regulate, promote, and ensure orderly growth of the insurance industry, and was in force in 2002. u/s. 32 of the third schedule of the 1999 Act, sec. 32-A was inserted in the 1972 Act which provided that the exclusive privilege of corporation and acquiring companies of carrying on general insurance business in India shall cease on and from the commencement of the 1999 Act, and they shall thereafter carry on general insurance business in accordance with the provisions of the Insurance Act 1938 (hereinafter referred to as the 1938 Act). The insured had taken a mediclaim policy known as Hospitalisation and domiciliary Hospitalisation Benefit Policy. Condition No. 11 of the mediclaim policy, inter alia, provided that the company shall not be bound to renew the policy and may at any time cancel the policy. It is further stated in the counter affidavit that in view of the terms and conditions of the mediclaim policy, the company is not duty-bound to renew