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Judgment
THESE two are cross-appeals against the common order of 8th October, 1992 recorded by the State Commission of Karnataka in Complaint No. 30/91. The State Commission had allowed the complaint in part and directed the Insurance Company to pay a sum of Rs. 25,000/- to the complainant towards cumulative bonus earned by him. In addition, he was allowed Rs. 500/-as costs.
WE shall hereinafter refer to the complainant before the District Forum as ''the Complainant, and the Opposite Party Insurance Company as the Respondent. The brief facts are that the Complainant had obtained a Personal Accident Insurance Policy from 24.4.1985 to 23.4.1986, then from 23.10.1986 to 22.10.1987 and lastly from 23.10.1987 to 22.10.1988. The sum insured in all the three policies was Rs.1 lakh. In addition he was entitled to a cumulative bonus of 5 % of the sum assured.
THE appellant suffered an accident on 20th September, 1988 during the currency of the last mentioned policy 23.10.1987 to 22.10.1988.
THE insurer paid him a sum of Rs.1 lakh towards the accident benefit and also a sum of Rs. 10,000/- towards the medical expenses but no cumulative bonus. The dispute is limited to the question of cumulative bonus said to have been earned by the insured. The relevant bonus clause reads as under: "Cumulative Bonus compensation payable under Clauses (a), (b), (c) and (d) of the policy viz., death, loss of limbs or sight and permanent total disablement arising out of accidental injuries shall be in creased by 5% thereof in respect of each completed year, during which the policy shall have been in force, prior to the occurrence of an accident for which capital becomes payable but amount of such increase shall not exceed 50% of the capital sum insured stated in the Schedule herein."
"The earned cumulative bonus will not be lost if the policy is renewed within 30 days after its expiry."
The Insurance Company has repudiated its liability for accident cumulative bonus on two grounds: (i) Cumulative bonus would become payable in case of accident resulting in death, loss of limb or sight or permanent total disablement. According to the Insurance Company the Complainant did not suffer permanent total disablement. According to the testimony of the Doctor produced by the Complainant "as at present the Complainant''s right leg is having total permanent disability. That may continue till the removal of the plates and screws. If that is done, there are good chances of the Complainant getting over this disability".
(i) It is worthy of note that this witness has deposed in cross-examination that the percentage of disability is only 40 and not total. As the Complainant is now able to move about with the help of crutches, he is able to do desk-work which is called clergymen''s job. (ii) The first policy in vogue from 24.4.1985 to 23.4.1986 was renewed only from 23rd October, 1986 i.e. not within a period of 30 days after the expiry of the policy. Therefore, the Complainant was not entitled to cumulative accident bonus.
AFTER considering the record we feel that there is merit in the contention of the Opposite Party-Insurance Company that there was no loss of limb or permanent disability suffered by the Appellant in the accident. In short, there is no permanent total disability arising out of the accidental injuries sustained by the Complainant. As such, the cumulative bonus clause of the policy is not attracted. It will be erroneous to treat the policy as effective from 23.10.1986 in renewal of the previous policy which expired on 23.4.1986. If it is to be treated as renewal, even after the 30 days gap, then it would have been due to be renewed from 23.4.1986 to 22.4.1987 and likewise the third policy would have been renewed from23.4.1987to 22.4.1988. In that case, the date of the accident viz. 22nd September, 1987 would fall beyond the third accident policy. In the result, the Appeal of the insurer is allowed and the appeal of the insured is dismissed. The Order of the State Commission is set aside. There is no order as to costs.