Renewal of the policy refused without any valid cause.

A. Kulasekaran, J.

This writ appeal is directed against the order dated 24.07.2007 passed by the learned single Judge allowing W.P. (MD) NO. 3930 of 2007, which was filed by the respondents herein praying for a Writ of Certiorarified Mandamus to call for the records relating to the order dated 01.03.2007 of the appellant herein and to quash the same and consequently direct the appellant to renew the hospitalisation and domiciliary hospitalisation benefit policy (individual Medi-claim Policy) No.720300/48/05/76191 dated 24.02.2006 from 00.00 hours on 25.02.2007 to midnight of 24.02.2008.

2. The case of the respondents is that the respondents 1 and 2 are father and mother of the third respondent. The third respondent is the proposer of Hospitalisation and Domicilliary Hospitalisation Benefit Policy (Individual Medi-claim Policy) NO. 720300/48/05/76191 dated 24.02.2006 held by the first and second respondents. The said policy was originally issued by the appellant in the year 1999 and the same was renewed every year, which was to expire on 23.02.2007. Prior to the said date, a cheque for renewal of premium by loading of 40% more than the previous year on account of age and claim factor was sent by the third respondent through his agent. After receipt of the same, the appellant returned the said cheque on the ground that the appellant have already informed the insurer to make his own alternative arrangement for renewal and in any event, the request for renewal has come from unconnected source (agent), for both the reasons, the renewal sought was not considered. Thereafter, the third respondent himself once again sent the cheque and renewal request along with a covering letter dated 24.02.2007 to the appellant for which, the appellant has sent a reply dated 01.03.2007 refusing to renew the policy for the reasons mentioned therein and the same was challenged by the respondents in the above said writ petition.

3. The case of the appellant is that the respondents 1 and 2 are aged 77 and 72 years respectively and no insurer would accept such high risk proposal as there is no statutory compulsion, however, the appellant originally accepted the proposal for the reasons that the third respondent has taken several insurance policies for his family, employees of industries, inclusive of the policies of the respondents 1 and 2 upto 2006-2007. In the year 2007, the third respondent transferred all other policies to M/s. Iffco Tokyo General Insurance, except the policies of respondents 1 and 2 as they refused to take up the same which is evident that the said Insurance company itself while refusing to accept the request of the respondents 1 and 2, has returned their cheques for renewal and forwarded it to the appellant at the instance of the third respondent, instead of returning it to him or respondents 1 and 2. Under clause 5.9 of the Mediclaim Insurance, the policy can be renewed only by mutual consent and the parties have the right to even cancel the contract during the currency of the policy by issuing notice, as provided, hence, the cheque and renewal request sent by the third respondent was returned and ultimately, the impugned order has been passed.

4. The learned single Judge relied on Clause 5.9 and 11 of Mediclaim Insurance Policy and found that the appellant has retained the standing offer for renewal subject to the insurer paying the renewal premium in time; that if the policy sought for the first time is acceptable, in the absence of any other valid reasons, the insurance company cannot refuse the renewal; that clause 11 stipulates that the insurance policy is issued for a period of one year and subject to review, continuation of insurance cover will be available if the renewal premium is paid in time, in such event, insured is eligible to the benefits; that a joint reading of clause 5.9 and 11 would make it clear that there is a standing offer from the appellant and the moment the renewal fee is paid, there is an automa