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REPORTABLE  

IN THE SUPREME COURT OF INDIA  

CIVIL APPELLATE JURISDICTION  

CIVIL APPEAL NO. 6255 OF 2019  

KANWALJIT SINGH        ..….APPELLANT  

              VERSUS  

NATIONAL INSURANCE COMPANY LTD    …RESPONDENT  

J U D G M E N T  

VINEET SARAN, J  

The question involved in this appeal is with regard to the  

extent of the liability of the Insurance Company with regard to  

individual claim under “Parivar - Mediclaim for Family Policy” (for  

short “Family Mediclaim Policy”).  

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2. The admitted facts of this case are that since 2007-2008, the  

appellant had been taking individual Mediclaim Policies for his  

individual family members.  The dispute in the present appeal  

pertains to the medical claim for the year 2014-15, with regard to  

son of the appellant, namely Master Jasnoor Singh. The individual  

Mediclaim Policies of the said Master Jasnoor Singh from  

2007-2008 to 2013-2014 was for different sum insured, varying  

from Rs.50,000 in 2007-2008 to Rs.2,54,000/- in 2013-2014.  In  

the year 2014-2015, the appellant took Family Mediclaim Policy for  

a sum insured of Rs.5,00,000/- for the period 07.02.2014 to  

06.02.2015, which was for the appellant himself and his family  

members, namely, his wife, son Master Jasnoor Singh and  

daughter.  

3.  It was during the validity of the Family Mediclaim Policy  

2014-15, that in the year 2014 Master Jasnoor Singh fell sick and  

had to undergo treatment in Post Graduate Institute (PGI),  

Chandigarh. He was initially hospitalized from 24.05.2014 to  

19.07.2014 for which the medical bill was for an amount of  

Rs.5,40,741/-.  He was again hospitalized from 31.08.2014 to

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17.10.2014, for which the medical bill was for Rs.3,14,485/-.     

The total amount of medical bill thus came to Rs.8,55,226/-.     

The appellant lodged a claim for the said amount with the  

respondent–National Insurance Company Ltd (for short “Insurance  

Company”), which was initially repudiated by the Insurance  

Company without assigning any reason.  However, later  

considering that the said Master Jasnoor Singh had an individual  

medical claim policy in the year 2009-2010 for Rs.55,000/-, the  

respondent - Insurance Company deposited a sum of Rs.27,550/-  

in the account of the appellant towards final payment of the claim.  

4. Since the remaining claim was not paid, the appellant filed a  

complaint before the District Consumer Disputes Redressal Forum  

(for short “District Forum”) claiming an amount of Rs.5,00,000/-,  

which was the sum insured under the Family Mediclaim Policy for  

the relevant year 2014-2015.  Before the District Forum, the  

respondent – Insurance Company raised various preliminary  

objections but had mainly claimed that since the said Master  

Jasnoor Singh was having pre-existing disease, hence the claim was  

not payable under the terms of the Policy.  The District Forum,

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however, held that since the sum insured under the individual  

Mediclaim Policy of Master Jasnoor Singh for the year 2010-2011  

(four years prior to his hospitalisation) was Rs.1,07,500/-, the  

amount payable would be 50% of such sum insured for the year  

2010-2011, which comes to Rs.53,750/- and not 50% of the sum  

insured in the year 2009-2010, according to which Insurance  

Company had paid Rs.27,550/-.  Thus, District Forum directed  

that the balance amount of Rs.26,200/- would be payable to the  

appellant, along with Rs.5000/- towards harassment and mental  

agony, plus Rs.2000/- on account of litigation expenses, along with  

interest @ 9% p.a.  

5. Challenging the said order, the appellant herein filed an  

appeal before the State Consumer Disputes Redressal Commission  

(for short “State Commission”), which allowed the appeal of the  

claimant in toto, and directed payment of the entire sum insured  

i.e. Rs.5,00,000/-, minus the amount already paid by the Insurance  

Company.  Besides this, the Insurance Company was also directed  

to pay Rs.30,000/- as compensation for mental agony and  

harassment, plus Rs.10,000/- as litigation cost.

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6. Aggrieved by the said order of the State Commission, the  

respondent–Insurance Company filed a Revision Petition No. 2295  

of 2017 before the National Consumer Disputes Redressal  

Commission (for short “National Commission”).  By its order dated  

20.07.2017, the National Commission upheld the order of the  

District Forum.  After holding that the said Master Jasnoor Singh  

had pre-existing disease which was symptomatic in the year 2009,  

the National Commission held that the appellant herein would be  

entitled to 50% of the sum insured under the individual Mediclaim  

Policy of Master Jasnoor Singh for the year 2010-2011. Challenging  

the said order of the National Commission, this appeal has been  

filed by way of Special Leave Petition.  

7. The submission of learned counsel for the appellant is that  

since the individual Mediclaim Policy of Master Jasnoor Singh was  

continuously held since 2007-2008 till the year 2014-2015 and it  

not being the case of the Insurance Company that at the time of  

taking initial individual Mediclaim Policy in the year 2007, the said  

Master Jasnoor Singh had any such disease, hence, the repudiation  

or scaling down of the claim of the appellant could not be justified.  

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It was contended that the entire amount, as awarded by the State  

Commission, should be restored and this appeal be allowed.  

8. Per contra, learned counsel for the respondent – Insurance  

Company has justified the order of the National Commission in  

awarding the compensation of 50% of the sum insured for the year  

2010-2011, as had been awarded by the District Forum and has  

prayed that the present appeal be dismissed.  

9. We have heard learned counsel for the parties at length and  

have perused the record.  

10. The fact that Mediclaim Policy of Master Jasnoor Singh was  

continuously taken by the appellant for varying sum insured since  

2007-2008 till 2014-2015 is admitted by the insurance company.   

It is also not disputed that at the time of taking the initial  

Mediclaim Policy for the year 2007-2008, the said Master Jasnoor  

Singh did not have any pre-existing disease.  In fact, it is admitted  

that prior to the year 2014-2015, the appellant had been taking  

individual Mediclaim Policies for his family members and it was  

only in the year 2014-2015,  at the time of renewal of the  

individual Mediclaim Policies, that the appellant had taken the

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Family Mediclaim Policy, which was effective from 07.02.2014 to  

06.02.2015.  It is also admitted that the said Family Mediclaim  

Policy was for a total sum insured amount of Rs.5,00,000/-.   

Under the terms of the Policy, the total expenses incurred for any  

one illness would be limited to 50% of the sum insured for the  

family.  The relevant Clause under the Policy is re-produced  

hereunder:  

“Company’s liability would, arise if the  treatment of disease or injury  contracted/suffered is incepted during the  policy period. Total expenses incurred for any  one illness is limited to 50% of Sum Insured per  family. Company’s liability in respect of all  claims admitted during the period of insurance  shall not exceed the Sum Insured mentioned in  the Schedule”.    (emphasis supplied)  

11.  It is not disputed that the sum insured under the Family  

Mediclaim Policy, was Rs.5,00,000/-.  From the above, it would be  

clear that the total medical claim for all the four members of the   

family during the period of commencement of the Insurance Policy  

(i.e. 07.02.2014 to 06.02.2015) would be Rs.5,00,000/- and for any  

individual claim or illness for any one member of the family, the  

limit would be 50% of the sum insured, which in the present case

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would come to Rs.2,50,000/-.  Thus, at best the maximum claim  

which could be payable in the present case would be 50% of the  

sum insured under the Family Mediclaim Policy for the medical  

treatment of one member of the family, which was Master Jasnoor  

Singh.    

12.  It may be noticed that the claim could not have been  

repudiated by the Insurance Company as there was no pre-existing  

disease when the initial individual Mediclaim Policy of Master  

Jasnoor Singh was taken in the year 2007-2008. Since then the  

policy was regularly renewed up to the year 2014-2015. Thus in the  

facts of the present case, the respondent – Insurance Company  

cannot take the plea of any pre-existing disease of Master Jasnoor  

Singh.  Even otherwise, after having initially repudiated the claim  

of the appellant, the Insurance Company had itself allowed the  

claim to the extent of Rs.27,550/-, which amount was deposited in  

the account of the appellant, meaning thereby that the question of  

pre-existing disease in the case of the claimant was not considered  

to be material by the Insurance Company.

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13.  As we have already observed herein above, the total  

medical expense or claim for any one illness for any individual  

member of the family would be limited to 50% of the sum insured  

for the family.  In the present case, the sum insured for the family  

under the Family Mediclaim Policy was Rs.5,00,000/-. Thus, in our  

considered view, the amount payable against the medical claim of  

Master Jasnoor Singh, under the policy, would be limited to the  

extent of Rs.2,50,000/-.  Undisputedly, the medical expense  

incurred and claimed by the appellant for the treatment of Master  

Jasnoor Singh within the effective period of the policy was over  

Rs.8,00,000/-. As such the appellant would be entitled to a sum of  

Rs.2,50,000/- minus the amount already paid by the Insurance  

Company under the orders of the District Forum.   

14.  Accordingly, we allow this appeal to the extent that the  

respondent – Insurance Company shall pay to the appellant a sum  

of Rs.2,50,000/- (two lakh fifty thousand) minus the amount  

already paid, towards final settlement of the medical insurance  

claim of the appellant. The appellant would also be entitled to an  

amount of Rs.50,000/- towards mental agony and harassment,

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plus Rs.30,000/- towards costs of litigation. The Insurance  

Company would also be liable to pay interest @ 7.5% p.a. on the  

balance amount payable, from the date of the complaint filed before  

the District Forum, till the date of actual payment of the balance  

amount.  

………………………………..J                                      (UDAY UMESH LALIT)  

               ………………………………J              (VINEET SARAN)  New Delhi  August 14, 2019