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2016 Supreme(J&K) 106
IN THE HIGH COURT OF JAMMU AND KASHMIR
N. Paul Vasantha Kumar and Ali Mohd. Magrey, JJ.
Bajaz Allianz General Insurance Company Ltd. – Appellant
Vs.
Shahida Begum and Ors. – Respondents
OWP No. 1383 of 2014
Decided On : 10-05-2016
For the Appellant : T.A. Malik.
The main legal point established in the judgment is the liberal construction of welfare statutes and insurance policies, as well as the binding nature of directives issued by regulatory authorities.
Headnote:
Insurance - Claim Dispute - Group Janta Personal Accidental Insurance - Article 4 - Risk coverage for accidental death and disability - Interpretation of policy clause - Liberal construction of welfare statutes - Circular by Insurance Regulatory and Development Authority
Fact of the Case:
The petitioner, an Insurance Company, challenged the orders directing it to pay the claim amount to the respondents, who were the legal heirs of a deceased State Government employee. The employee had sustained critical injuries from a fall and subsequently died. The petitioner refused to settle the claim, citing the death occurring beyond 12 months from the date of the accident.
Finding of the Court:
The court found that the deceased was certified as totally disabled and bedridden due to the injuries sustained from the accident. It held that the insurance cover is meant to compensate for injuries and benefit the affected parties, and should be construed liberally. The court also referred to a circular by the Insurance Regulatory and Development Authority, which mandated insurers not to reject claims solely on the ground of delay.
Issues: Interpretation of the insurance policy clause regarding the time limit for claim settlement and the applicability of the circular by the Insurance Regulatory and Development Authority.
Ratio Decidendi: The court emphasized the liberal construction of welfare statutes and the need to interpret insurance policies in a manner that fulfills their intended purpose. It also highlighted the binding nature of the circular by the Insurance Regulatory and Development Authority, which prohibited rejection of claims based solely on delay.
Final Decision: The writ petition was dismissed, and the petitioner was directed to pay the compensation amount to the respondents within one month.
N. Paul Vasantha Kumar, J.
1. This writ petition is filed by the petitioner-Insurance Company, questioning the order dated 21.10.2013 passed by the District Consumer Protection Forum Srinagar as well as order dated 15.05.2014 passed by State Consumer Disputes Redressal Commission, directing the petitioner to pay the claim amount to the respondents 1 to 4 along with compensation and litigation charges. The case of the respondent Nos. 1 to 4 before the District Consumer Forum was that one Jamal-ud-din Jungale, husband of respondent No. 1 and father of respondent Nos. 2 to 4, while working as Laboratory bearer in Government Higher Secondary School Boys, Uri fell from the school building on 17.02.2009 and sustained critical injuries. He sustained contusions in lungs, head injury, compression fracture D3-D5 with Cord edema and contusion at D1-D5. His spinal cord was completely edematous and fractured. He also sustained fracture of T4 vertebra and was diagnosed to have T4 paraplegia (loss of sensation). He also sustained various internal bodily injuries which rendered him paralyzed and he could not move his legs and had been rendered disabled. He was operated at SKIMS, Soura, Srinagar and thereafter was taken to Christian Medical College Hospital, Vellore in Kolkatta for further specialized treatment. He succumbed to his injuries on 05.01.2011.
2. Pursuant to the death of said Jamal-ud-din Jungale, who was a State Government employee, his widow and minor children immediately intimated regarding the fact of his death to the Government department, Principal of the school as the deceased was a subscriber of Group Janta Personal Accidental Insurance and the legal heirs, namely, respondent Nos. 1 to 4 submitted a claim before the petitioner and requested to settle the claim. The petitioner, who was shown as 1st respondent before the District Consumer Forum, requested to furnish certain documents which were also furnished. Inspite of furnishing the required documents the petitioner Insurance Company failed to settle the claim though the deceased was a subscriber of the Group Janta Personal Accidental Insurance claim w.e.f. 2006 and had also paid up to the financial year 2010-2011 by paying the requisite premium of Rs. 81/- which came to be deducted at source by his DDO and information whereof came to be furnished to the Nodal Officer of the petitioner.
3. As the petitioner has failed to pay the claim, the legal heirs of the deceased approached the District Forum for directing the petitioner to pay the amount of Rs. 2.50 lacs. The petitioner filed objections stating that the accident having taken place on 17.02.2009 and the death of the deceased employee having taken place on 05.01.2011, the petitioner is not liable to pay the sum assured as the death has taken place beyond 12 months from the date of accident which decision was conveyed to the petitioner on 17.08.2011.
4. The District Consumer Forum allowed the claim of the respondent Nos. 1 to 4 taking note of various documents produced to show the accidental fall of the deceased on 17.02.2009, continuous treatment taken in the hospitals, namely, SKIMS, Srinagar, CMC Vellore including the admission in the hospitals for getting treatment on various dates and the fact that premium was paid by the deceased, and awarded a sum of Rs. 2.50 Lacs to the claimants and Rs. 15000/- on account of physical and mental agony suffered by them along with Rs. 5000/- as litigation charges. The amount was directed to be deposited within one month failing which 6% interest per annum was awarded on the assured sum of Rs. 2.50 lacs.
5. The said award was challenged by filing appeal before the State Consumer Disputes Redressal Commission and the appeal was dismissed on 15.05.2014. The State Commission appreciated the Insurance Policy clauses particularly Article 4 stating that the risk coverage under the scheme shall include Accidental death, total or partial disability caused due to any kind of accident by
