Claim Barred by Policy Terms: Uttarakhand State Commission Sets Aside Order Against Oriental Insurance
Pranav B Prem
The Uttarakhand State Consumer Disputes Redressal Commission, presided over by Ms. Kumkum Rani and Mr. C.M. Singh, allowed the appeal filed by Oriental Insurance Company Ltd., thereby setting aside the order of the District Consumer Forum, Haridwar. The State Commission held that the complainant’s insurance claim was clearly barred by the exclusion clause in the policy and did not fall within the scope of the insurer’s liability.
The matter arose from a mediclaim dispute concerning a "Happy Family Floater Policy" purchased by the complainant, Late Shri Shivnath Chaturvedi, from Oriental Insurance Company. The policy, originally taken on 16.10.2009, covered the complainant, his parents, and his daughter, and was renewed for a further period from 16.10.2010 to 15.10.2011. During the second year of coverage, the complainant’s mother was admitted to Mahant Indresh Hospital, Dehradun on 30.12.2010 with complaints of anxiety, nausea, breathlessness, and fever. She was diagnosed with Type-2 Diabetes Mellitus, Urinary Tract Infection, and acute chronic renal failure, and was treated till 09.01.2011, incurring an expense of ₹54,096.
The complainant paid the hospital expenses and later submitted a claim to the insurance company. However, the insurer repudiated the claim on the ground that the treatment fell within the two-year exclusion clause relating to diabetes and associated complications. A legal notice issued by the complainant yielded no resolution, following which a complaint was filed before the District Commission, Haridwar.
The District Forum had allowed the complaint, holding that the policy was valid at the time of treatment and that the insurer’s denial was not justified. It directed the insurance company to pay ₹60,000, which included the cost of treatment and compensation.
Challenging this, Oriental Insurance filed an appeal before the State Commission. The insurer argued that the complainant’s mother was diagnosed with Type-2 diabetes during the second year of the policy and that Clause 4.3 of the policy terms excluded coverage for diabetes and related complications for the first two years after the inception of the policy. Since the mother received treatment for a condition explicitly excluded within the waiting period, the insurer maintained that it had acted within the contractual terms and that there was no deficiency in service.
The State Commission examined the policy documents, particularly Clause 4.3 of the general exclusions, which clearly stated that expenses for treatment of diabetes were not payable within the two-year waiting period. The Commission noted that the complainant’s mother’s treatment occurred during the second policy year, which was still within the waiting period for diabetes-related claims. The Commission observed, “The respondent No. 1’s mother has undergone the treatment of diabetes during the second year of insurance policy... and as the ailment of diabetes was excluded from the coverage of policy, the Insurance Company has rightly repudiated the claim.”
The complainant’s reliance on an NCDRC judgment in M/s Jindal & Co. v. Universal Sompo General Insurance Co.Ltd. [First Appeal No. 176 of 2015] was found to be irrelevant by the Commission as the cited decision involved a stock insurance policy and not a mediclaim health policy, making it factually distinguishable.
Accordingly, the State Commission held that the District Commission had erred in granting the relief without considering the specific exclusions under the policy. It concluded that the claim did not fall within the four corners of the policy contract and that the insurer’s repudiation of the claim was legally valid. The Commission therefore allowed the appeal, set aside the District Commission's order dated 11.07.2013, and dismissed the complaint. It did not award any costs of appeal. The statutory amount, if any, deposited by the appellants was directed to be released in their favour.
Appearance
For Appellants: Sh. S.P. Singh, Advocate
For Respondents: Sh. Shivam Sharma, Advocate
Cause Title: The Oriental Insurance Co. Ltd. & Anr. V. Sh. Shivnath Chaturvedi
Case No: SC/5/A/13/246
Coram: Ms. Kumkum Rani [President], Mr. C.M. Singh [Member]
