Insurance policy clauses limiting claim submission to fixed periods (e.g., 90 days max) that extinguish insured's rights are void under Section 28(b) of Indian Contract Act, 1872.

JUDGMENT :

[PER BHARATI DANGRE, J.]

1. In availing the benefit of Group Health Insurance, the Petitioner placed his claim before his employer i.e. Export Import Bank of India through his communication dated 24/05/2022.

The four claims for distinct period on behalf of the Petitioner himself and in respect of his spouse, aggregated to Rs.1,13,487.49/-.The communication also requested processing by the TPA/Insurance Company. Since this claim is turned down by United India Insurance Co. Ltd., by relying upon the time-lines set out in the insurance policy, the Petitioner is before us, seeking the relief of quashing and setting aside of the decision of the Insurance Company, rejecting the claim of the Petitioner on the ground that it is time barred.

2. By consent of the parties, we issue Rule, which is made returnable forthwith.

The Petitioner purchased a Group Health Policy from United India Insurance Co. Ltd. for a period covering from 01/04/2021 and ending in the midnight of 31/03/2022. The insurance policy, with the type ‘family floater basis’, stipulated the terms and conditions and the policy stipulated various expenses to be covered, by setting out the eligibility criteria as well as the claim procedure.

Clause 7.2 of the said policy under the caption, ‘procedure for reimbursement of claims’, made it imperative for the insured person to submit necessary documents to TPA/the company within the prescribed time-limit as specified thereunder and the relevant portion of the said policy reads thus :-

3. Clause 7.4 of the policy provided for the documents to be submitted by the insured in support of the claim, which included the documents like the medical history of the patient; bills and payment receipts duly supported by the prescription from attending medical practitioner/hospital; discharge certificate/ summary from the hospital; cash-memo/bills/ invoices from the diagnostic centre/hospital/chemist; payment receipt from Doctors, Surgeons, Anaesthetist etc. The note appended to clause 7.4 also clearly stipulated thus :-

“(iii) Any delay in notification or submission may be condoned on merit where delay is proved to be for reasons beyond the control of the Insured Person”.

Similarly, in clause 8 of the policy, under caption “General terms and conditions”, clause 8.2 clearly stipulated thus :-

“The terms and conditions of the policy must be fulfilled by the Insured Person for the Company to make any payment for claim (s) arising under the policy.”

4. The claim set out by the insured on 24/05/2022 is summarized below :-

5. The Insurance Company refused to consider the claim and vide its e-mail, declined the claim to be entertained, apparently since it was beyond the period of limitation prescribed in the policy.

6. When the Insurance Company communicated with the Petitioner/insured, that the claim was beyond the prescribed period as set out in the policy, the Petitioner relied upon the decision of the Apex Court in the case of The Oriental Insurance Company Ltd. Vs. Sanjesh & Anr., 2022 SCC Online SC