MADHU JAIN vs National Insurance Co. Ltd.

-THE appellant obtained a medi-claim insurance policy for a sum of Rs.1,00,000 for the period 10.3.2001 to 9.3.2002. She was admitted in Sir Ganga Ram Hospital during the subsistence of the policy on 11.10.2001 and was discharged on 19.10.2001. She raised claim as to the medical expenses on 7.11.2001. THE claim was repudiated by the respondent by invoking Clause 5.3 of the terms of the condition of the policy which is to the following effect: 5.3: Upon the happening of any event which may give rise to a claim under this policy notice with full particulars shall be sent to the Company within 7 days from the date of death, injury, hospitalisation domiciliary hospitalisation.

CONSEQUENTLY the appellant filed the instant complaint before District Forum. Vide impugned order dated 31.7.2002, the District Forum dismissed the complaint of the appellant justifying the repudiation of the claim by the Insurance Company. Feeling aggrieved the appellant has preferred this appeal.

Explanation of the appellant for not informing the happening of the event of hospitalization within seven days, was that she being very old and her only son being busy in looking after her, the necessary notice or intimation could not be given within seven days of the discharge from the hospital. However, the said explanation did not find favour with the respondent.

THERE is another clause in the insurance policy which is Clause 5.4. Under this clause, the period of seven days notice can be waived off in extreme case of hardship. It is settled law that any contract or for that purpose any law i.e. statute has to be read as a whole and not in isolation. There is no pick and choose. Service provider cannot take advantage of one clause to himself and cannot deny the same available by another clause to the consumer. Every case has to be judged on its own facts and circumstances and no rule of thumb can be applied by any service provider. Contract of insurance is for the benefit of the insured and if there is such circumstance which has even an element of plausibility of an explanation of any delay, the benefit of the clause wanting certain directory requirements should always be given to the consumer. By no stretch of imagination the nature of Clause 5.3 can be held as mandatory. At the most it is directory to be interpreted in the given facts and circumstances of the case.

LEARNED Counsel for the respondent has tried to take support of a judgment of the Supreme Court in Oriental Insurance v. Soni Cherrian, for justifying the repudiation wherein it was held that insurance policy between the insurer and the insured represents a contract between the parties and since the insurer undertakes to compensate the loss suffered by the insured on account of risk covered by the policy, the term of the agreement has to be strictly construed to determine the extent of liability of the insurer, the insured cannot claim anything more than what is covered under the policy. In our view the ratio of the aforesaid judgment is not applicable at all in the facts of this case as it was not a case of damage to the vehicle or goods limiting the extent of indemnification of loss. Aforesaid view was expressed by the Supreme Court in the particular circumstances of the case where respondent''s truck which was insured with the Insurance Company caught fire while carrying 15 barrels of ether solvent and the contention of the respondent was that although ether solvent has been described in Table III to Rule 137 of Central Motor Vehicles Act as a hazardous and highly flammable article and as per permit granted to the respondent he could transport only non-hazardous articles and the insurance policy covered only those goods which were permissible under the Motor Vehicles Act, to be carried out by the respondent the judgment passed by the State and National Commission are incorrect.

THE instant case is that of a human being. THE interpretation of Clause 5.3 given by the respondent was wholly erroneous. This clause was not at all applicable in the given facts and circumstances of the case as it says that it is only upon happening of the event which may give rise to the claim under this policy the notice with full particulars will be sent to the company within seven days of the date of death, hospitalization but the explanation of the appellant that she being very ill and her only son was looking after her was sufficient to give benefit of Clause 5.4 of the policy to the appellant.

IT is universal law of interpretation of statute or term of contract particularly the contract of insurance that if there are two possible interpretations of any term of the contract or statute and even more than two interpretations are possible, the interpretation which protects the interests of the consumer or is in favour of the consumer should be acted upon and accepted and no other interpretation. Here the claim of the appellant was repudiated with a sledge of hammer without going into facts as to what was the condition of the patient who remained in the hospital for more than 8-9 days and thereafter was being looked after by her only son and to expect in such an eventuality to immediately inform or give intimation to the insurance Company is too much. Merely because the respondent was discharged from the hospital does not mean that she was fit enough to go for work. There is convalesce period also. Life is more important than ay claim of insurance as to the medical expenses.

The instant case in our view was case of extreme hardship and therefore benefit of Clause 5.4 should have been given by the officer of the respondent Insurance Company who appears to have taken decision without any application of mind.

FOREGOING reasons persuade us to allow the appeal, set aside the impugned order with the direction to the respondent to pay Rs. 1,00,000 insurance amount though expenses were shown as Rs. 1,90,000. We also award Rs. 25,000 as compensation for mental agony and harassment suffered by the appellant, which shall include the cost of litigation. The payment shall be made within one month from the date of receipt of this order. Bank Guarantee/FDR, if any, furnished by the appellant be returned forthwith.

A copy of this order as per the statutory requirements be forwarded to the parties free of charge and also to the concerned District Forum and thereafter the file be consigned to Record Room. Copy be sent to Presidents of all the District Forums. Appeal allowed.