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IN THE HIGH COURT OF PUNJAB AND HARYANA
RITU BAHRI, J.
The Oriental Insurance Co. Ltd. - Appellant
Vs.
Naresh Sharma and Others - Respondent
Civil Writ Petition No. 4695 of 2013 (O and M)
Decided On : 07-10-2014
Insurance - Reimbursement Claim - Exclusion Clause - [Hypertension, Insurance Policy, Permanent Lok Adalat, Division Bench Judgment] - The court discussed the exclusion clause in the insurance policy, specifically focusing on the interpretation of the term 'hypertension' and its applicability to the claimant's medical treatment. The court referred to a Division Bench judgment and emphasized the need to interpret exclusion clauses in favor of the insured in genuine circumstances. The judgment highlighted the principles of good faith, fairness, and reasonableness in insurance contracts, as well as the duty of the insurer to regulate and ensure the orderly growth of insurance business. The court ultimately upheld the direction to the insurance company to reimburse the claimant's medical expenses.
Fact of the Case:
The claimant, Naresh Sharma, filed a reimbursement claim with the insurance company for medical expenses incurred due to headache, giddiness, and hypertension. The insurance company denied the claim based on an exclusion clause in the policy. The Permanent Lok Adalat directed the insurance company to reimburse the claimant, relying on a Division Bench judgment and principles of fairness and good faith in insurance contracts.
Finding of the Court:
The court found that the exclusion clause in the insurance policy, specifically related to hypertension, did not justify the denial of the claimant's reimbursement claim. The court emphasized the need to interpret exclusion clauses in favor of the insured in genuine circumstances and upheld the direction to the insurance company to reimburse the claimant's medical expenses.
Issues: Interpretation of exclusion clause in insurance policy, applicability of exclusion clause to claimant's medical treatment, fairness and good faith in insurance contracts
Ratio Decidendi: The court's decision was based on the interpretation of the exclusion clause, principles of good faith, fairness, and reasonableness in insurance contracts, and the duty of the insurer to regulate and ensure the orderly growth of insurance business. The court emphasized the need to interpret exclusion clauses in favor of the insured in genuine circumstances.
Final Decision: The court dismissed the challenge to the Permanent Lok Adalat's order and upheld the direction to the insurance company to reimburse the claimant's medical expenses.
Ritu Bahri, J.
1. Challenge in this petition is to the order dated 15.11.2012 (Annexure P-1) passed by the Permanent Lok Adalat (Public Utility Services), Gurgaon-respondent No. 3, whereby the petitioner-insurance company has been directed to pay an amount of Rs. 2,00,000/- along with interest at the rate of 9% per annum to the claimant. Naresh Sharma-respondent No. 1 had taken a mediclaim policy bearing No. 215300/48/2011/5248 for the period from 25.01.2010 to 24.01.2011 (Annexure P-2) from the petitioner-company and assured a sum of Rs. 2,00,000/-. This policy was subsequently renewed to be valid from 25.01.2011 to 24.01.2012. Respondent No. 1 suffered from headache, giddiness and hypertension on 03.01.2012, due to which, he was got admitted in Madanta Hospital, Gurgaon, from where he was discharged on 07.01.2012. He was treated by Dr. Achint Malhotra. During this period, he incurred a sum of Rs. 3,33,877/- on his treatment. Thereafter, he made a claim to the petitioner-insurance company for reimbursement of the amount, which was incurred by him on his treatment. But, his claim was not entertained by the petitioner. Therefore, he filed an application before the Permanent Lok Adalat-respondent No. 3.
2. Before the Permanent Lok Adalat, the stand of the petitioner-company was that vide letter dated 06.02.2012, the applicant-respondent No. 1 had been informed that necessary documents had not been received despite three query letters. On this account, the benefit had been denied. The claim was denied on the ground that charges relating to the treatment of the disease were not payable in the first two years of the policy period and it was explained to claimant-respondent No. 1 at the time of granting the aforesaid policy.
3. The Permanent Lok Adalat, after making attempts for reconciliation, decided the claim of respondent No. 1 in view of the Division Bench judgment delivered in Iffco Tokio General Insurance Company Ltd. Vs. Permanent Lok Adalat (Public Utility Services), Gurgaon and Others, (2013) ACJ 1478.
4. Learned counsel for the petitioner-company has argued that the aforesaid judgment, relied upon by the Permanent Lok Adalat, would not be applicable to the facts of the present case. Naresh Sharma-applicant was suffering from headache, giddiness and hypertension, due to which, he was admitted in Madanta Hospital, Gurgaon on 03.01.2012 and remained admitted till 07.01.2012. He incurred a sum of Rs. 3,33,877/- on his treatment. As per exclusion clause of policy (Annexure P-2), disease of hypertension, on account of which claimant-respondent No. 1 had got himself admitted in the hospital, was excluded in the first two years of policy period. Claimant was in the second year of the policy, which had been renewed on 25.01.2011. Therefore, he was not entitled for the facility of cashless treatment. There was no breach of any term of the policy on the part of the petitioner-company. Hence, the claim has been wrongly accepted by the Permanent Lok Adalat.
5. A perusal of the policy (Annexure P-2) does not show any of the exclusion clauses. The other ground for rejecting the claim of applicant-respondent No. 1 was that necessary papers have not been supplied to the company. However, during the course of proceedings before the Permanent Lok Adalat, the bills were produced and effort was made to amicably resolve the dispute. As per clause 4.3 of the policy (Annexure P-2), the applicant-respondent No. 1 could not be reimbursed the charges during the currency of the policy. Clause 4.3 is reproduced as under:-
"4.3 The expenses on treatment of following ailment/diseases/surgeries for the specified period are not payable if contracted and/or manifested during the currency of the policy. If these diseases are pre-existing at the time of proposal, the exclusion No. 4.1 for pre-existing condition SHALL be applicable in such cases.
6. At serial No. XVII of the above table, the exclusion clause relates to hypertension, as per which, for a pe
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