Update - Notice sent to Royal Sundaram after the last review following this notice.
By Registered Post/Speed Post
FromSoumendra Nath Thakur, Certification: IC-33 Insurance Institute of India, Industrial & Marketing Management, SISI, GoI. 254, Madhyamgram Main Road, South Bankimpally, Madhyamgram, District - North 24 Parganas, Kolkata – 700129, Mobile No – 9067594470
Re: Policy No. HC00018224. Date: 28 June 2020
To,
(1) Royal Sundaram General Insurance Co. Limited.
The Millennium, Unit 4E, 4th Floor, 235/2A, A. J. C. Bose Road,
Kolkata - 700020, (2) Royal Sundaram General Insurance Co. Limited. Corporate Office: Vishranthi Melaram Towers,
No.2/319, Rajiv Gandhi Salai(OMR), Karapakkam, Chennai – 600 097
Sub: Notice for issuance of Renewal Advice for the Policy No. HC00018224, between the period of 23/08/2020 & 22/08/2021, Notice under item E.(5) of the contract of Health Forever policy.
Dear Sir/s,
The above captioned notice is served upon you on behalf of your above mentioned customer Soumendra Nath Thakur based on the foundations as mentioned in the following averments. You are therefore requested to issue asked renewal advice to your customer immediately from the date of receipt of this notice, for the period and Policy number respectively mentioned in the above caption.
1) That your customer, said Soumendra Nath Thakur, and your company – former name “Royal Sundaram Alliance Insurance Company Limited” have entered into a contractual agreement and conditions for the instant health insurance policy named “Health Forever, ” insured by your company, and your customer has agreed and signed the mutual agreement at his present residence in the year 2006. This mutual agreement legally binds both the customer and the insurer and determines respective rights and responsibilities of the insurer and the customer concerned.
a) That the sales brochure of the health policy was provided to your customer by your representative that stipulates the policy’s Key benefits, Features, Other terms & conditions, and Premium rates of five different plans based on Sum Assured of 1, 2, 3, 4 and 5 lakhs respectively and your customer has opted plan-1 said for a Sum Assured of 1 Lakh, having a policy number HC0001822400100 that was commenced about 14 years ago on dated 23-August-2006.
b) That in a later occasion, your company was renamed as “Royal Sundaram General Insurance Company Limited” and a new policy No HC00018224 with new membership No HC00018224A was reassigned to your customer by your company, and a new membership card was sent to your customer as a continuation of the same said policy that was commenced on dated 23-August-2006 said.
c) That instead of the fixed premiums payable as per the age of the customer under Plan-1 as per the prevailing agreement, your company did not withdraw ‘Health Forever’ policy even though unviability of the product, rather contrary to item E(11) in the conditions of the contract, your company has increased 22.50% on the payable premiums from dated 01-08-2015 for said policy and deducted a higher premium amount from the customer even by going against the agreement said, accordingly a dispute was escalated before Integrated Grievance Management System(IGMS) with IRDA Token Number 09-15-021689 which you company has rejected. d) That a complaint was made before the Ld. Office of the Insurance Ombudsman, Kolkata involving policy no. HC00018224000109 and on dated 15-10-2015, Ld. Insurance Ombudsman has dismissed the complaint of your customer stating the reason, “matters related to deduction or non deduction of premiums” cannot be considered by the forum. Therefore your customer was made to pay higher premiums and continued in paying the same even till last premium payment date, as your company did not withdraw ‘Health Forever’ policy even though said unviability of the product rather made to pay higher premiums to this customer.
e) That since last fourteen years(14) and till last premium paying date, your customer has been paying annual premiums to your company on time and without any claim and without any break. Your customer needs to continue the same policy in his increased age and his legal financial status. Reasonably, here should be no constraint if a “similar alternative product”, having similarity in the payable premium and policy character with the existing policy, is being offered by your company to your customer but there is no such offer from your company as on date. The conditions of the existing policy remained violated by your company as on date, under item nos. E.(5), (11) &(20) of the contract of the Health Forever policy. f) That even after maintaining the existing health policy by your customer continuously for 14 years with your company, now a “similar alternative option” is not available to your customer to port it out to other insurers, except availability of dissimilar health policies with much higher financial consequences due to his increased age, resulting this policyholders’ interests unprotected. A new “similar alternative policy” is though available in similar premium category it is not available for porting out but available without the pre existing conditions – without credit gained by the insured for waiting period and accumulated bonus. Such a new similar alternative policy from other insurers unprotects your customer from the policyholders’ interests - contrary to application of the section under 14(1) of the IRDA Act, 1999.
2) That the contractual agreement for the withdrawal condition of the policy under the item E.(11) of the contract stipulates, “The product/plan may be withdrawn at any time, by giving a notice of 3 months to the Proposer at the address recorded/updated in the policy. When the policy is withdrawn, the product/plan shall not be available for renewal at the due date. However, the cover under such policy shall continue till the expiry date shown in the Schedule of the policy. In the event of withdrawal of a product, Company shall offer similar alternative product from its currently marketed product suites.
a) That much before 3 months(90 days) from the forthcoming renewal date of the policy on 22 August 2020, there was a 14-hour voluntary public curfew on 22 March 2020, followed the order of 24th March 2020 by the Government of India for a nationwide lockdown extended till 30 June 2020, limiting movement of the entire population of India, whereas the Courts, post offices, offices and business establishments were put to shutdown through out India, in such a condition issuing and sending a legal notice from your company must be considered bad in law, even if such a notice was sent by your company that action would be contrary to the order of 24th March 2020 by the Government of India and also would be invalid and inapplicable, contrary to the item no. E.(5) in the conditions of the policy contract. Therefore, the question of sending a valid legal notice to the customer during said lockdown period cannot or does not arise. Such action by your company would be contrary to the applicability of the sections under 14(1) of the IRDA Act, 1999 and Regulation 4(6) of IRDA(Protection of policyholders’ interests) Regulations, 2002.
b) That the customer cannot receive, nor had received a valid notice of 3 months(90 days) from your company at the address recorded/updated in the policy with the insurer during the said lockdown order of 24th March 2020 extended till 30 June 2020 – either by post or by courier service, – if at all a notice ever issued and sent by your company to the customer, such a notice cannot be considered valid and should be ineffective, unless a complete fulfillment of the policy agreement as mentioned in the item no. E.(11) of the policy conditions that stipulates, “…company shall offer similar alternative product.” Also such action by your company would be contrary to the applicability under section 14(1) of the IRDA Act, 1999 and Regulation 4(6) of IRDA(Protection of policyholders’ interests) Regulations, 2002. So that a similar alternative product was never offered by your company to this customer till date, for the reasons a similar alternative product would mean similar to the existing plan-1(out of the five different plans) of “Health Forever” policy, also “similar” in its feature/character - only such an alternative product can be considered similar and not all alternative products are similar. As it is legally established that ‘similar’ is not a restrictive word, so that your offer cannot restrict ‘premium amounts’ of the Health Forever policy only by considering its ‘feature/character’ as ‘similar’ by offering any alternative product as a similar alternative offer, rather a similar alternative would mean similar both in plans/premium amounts as well as in its feature/character, but it was never the same. Such action by your company not only violative to the item no. E.(11) of the policy conditions, also violative to the applicability of the section under 14(1) of the IRDA Act, 1999 and Regulation 4(6) of IRDA(Protection of policyholders’ interests) Regulations, 2002.
c) That the original Health Forever policy agreement was signed by the customer in physical/hard copy documents, at his residence, so the procedure naturally demands that such a notice for withdrawal should be made through physical/hard copy document to the customer, but there was not any, as such there is no such offer ever was made to this customer and sent to the recorded address of the customer by post or by courier through a notice of 3 months(90 days). Such action by your company is violative in the applicability to item no. E.(5) in the conditions of the policy contract and Regulation 4(6) of IRDA(Protection of policyholders’ interests) Regulations, 2002.
d) That as per availability of free legal aid from the State Legal Services Authority, West Bengal and Calcutta High Court Legal Services Committee; under The Legal Services Authorities Act 1987. And the pending cases before the Appropriate Courts involving adequate means of livelihood of your customer, annual income of your customer does not exceed the limit of prescribed amount, as such the legal income of your customer is low, so that, if premium of such an essential health policy is made excessively high compared to the existing budget of your customer, it would escalate violation of his fundamental rights and also his consumer rights being a customer of your company.
e) That your customer is completely absorbed with the existing payment of premiums for all of his existing policies, as such an untoward, excessive increment in the payments of premium for any of his policies would be detrimental to him.
Therefore, considering the above stated facts, circumstances & foundations, as mentioned in the averments(1) and(2) and in their sub-paragraphs, your customer request
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20 May 2020 last inappropriate reply of Royal Sundaram General Insurance Co.,
"Dear Mr. Thakur, Greetings from Royal Sundaram General Insurance Co. Limited and Thank you for writing to us. As requested we enclose herewith the features of the new product offered for your reference."
The enclosure said is nothing but an inappropriate, extraneous, new policy document, irrelevant to the existing policy, but Royal Sundaram evades specific questions, raised by the customer, in his initial email as mentioned below.
Dated: 19th May 2020
To, (1) The Royal Sundaram General Insurance Co. Limited,
Registered Office: 21, Patullos Road, Chennai 600 002
(2) Vishranthi Melaram Towers, No.2/319, Rajiv Gandhi Salai(OMR), Karapakkam, Chennai - 600097.
Dear Sirs,
Refer: Your Renewal Advice- Notice for Withdrawal dated 18/05/2020 regarding Policy No. HC00018224000113.
I, Soumendra Nath Thakur, received the above referred notice through email, attached file named HC00018224000113.pdf, therefore please reply the following within seven days from today, as per following item nos.(1)(i), (ii) &(iii), (2) and(3).
In your "Renewal Advice-Notice for Withdrawal" dated 18/05/2020, you have confirmed that in line with regulation, you are providing this customer with suitable alternative product viz; Lifeline - which is significant upgradation from this customer’s expiring product i.e. Health Forever. You have also confirmed that the alternative product Lifeline is being offered to this customer with full portability benefit such as carry forward of waiting periods, preexisting, No Claim Bonus, etc. to the extent of the customer’s expiring Sum Insured(SI) and Cumulative Bonus(CB).
However though you have confirmed a suitable alternative product viz; Lifeline, as it appears with full portability benefit and to the extent of the customer’s expiring Sum Insured(SI) and Cumulative Bonus(CB) of the existing policy in line with IRDAI regulation, but this customer finds discrepancies in your said offer on the following points –
Your said notice does not contain a product brochure and also sales brochure of the offered alternative product viz; Lifeline – which is required by this customer for self-evaluation.
You said notice does not mention amounts of respective premiums(age-wise) payable under the alternative product viz; Lifeline, required for the self-evaluation and also deciding acceptance by this customer.
Your offer of Lifeline to this customer does not fully correspond to the full portability benefit of the existing policy in line with IRDAI regulation, as under the existing policy# HC00018224000113 the Sum Insured(SI) is INR 100000 but under the offered Lifeline Sum Insured(SI) is INR 200000, (which is double the SI of the existing policy) along with carried forward Cumulative Bonus of the existing policy.
Therefore, the offer of Lifeline policy seems to contradict in line with IRDAI regulation and also likely to cause untoward consequences to this customer, even for maintaining the exiting policy for fourteen(14) years with your company, never claimed, and for no fault of this customer. So please reasonably address how to resolve these issues.
Please resolve the above as per requirement of the customer as mentioned in the above items Nos.(1)(i), (ii) &(iii).
Considering the facts and circumstances that existing health insurance policy is in the nature of fundamental right of this customer and the relationship between your company and this customer is based in contractual nature. So, it should be the natural obligation legal duty of your company to market Health Insurance product only after its technical feasibility and financial viability has been properly ascertained, any cost for likely inflation adequately calculated so that declared renewal premiums of such policies necessarily remains stable during its lifetime as mentioned in the renewal chart. The onus to ascertain such viability of completely rests on the shoulder of your company but not on the customer. The customer rather subject to make renewal payments as per the contract of the policy.
Moreover, in earlier occasion too, your company has failed to maintain contractual policy and on 1st August 2015 increased the premium by 17.50% and 22.50% for up to 45 years and more than 45 years respectively, claimed to be due to medical inflation in India, and now your company, with new excuse of unviability, has withdrawn said product completely from market with effect from 1st October 2019 that too without prior intimation to the customer and for getting acceptance for such withdrawal before its withdrawal.
Therefore, on the basis of above stated grounds, your company can't really make this customer liable for the outcome of said unviability of the product. The customer is rather responsible to make the renewal payments as stipulated in the renewal chart(age-wise) - for which he has entered into the policy through his agreement and acceptance in the policy’s terms and further accepted increased renewal payments. Such decision of the customer in make said premium payments was based on his financial capacity, affordability, and maintainability of the policy but certainly not on external matters such as said unavailability, nor even for medical inflation. The customer already suffered hard for the earlier increment in the premium by 17.50% or 22.50% since 1st August 2015.
The customer demands reasonable answer for the above said.
That the Health Forever Policy No. HC00018224000113 of this customer is effective till 21/08/2020 and he is a loyal customer of said product for last fourteen(14) years, since 23/08/2006 and there is no claim in the policy as on date. Whereas, your "Renewal Advice-Notice for Withdrawal" dated 18/05/2020 sent through email to this customer on dated 18 May 2020 confirms that said product is no longer financially viable, according to your company, and therefore you are withdrawing said product with effect from 1st October 2019 completely from market.
However, it is not convincing to this customer that without providing prior intimation and getting his acceptance for such withdrawal, how can you at all withdraw said product from market completely with effect from 1st October 2019, which is more than ten(10) months in advance from the date of future expiry of said Policy No. HC00018224000113 and said policy is still effective till 21/08/2020?
The customer demands a reasonable answer for the above said.
Please treat this communication as a demand for natural justice
Thanks & regards
Soumendra Nath Thakur
Mob:+91-9067594470
Attachment: Your above said Notice with file name "HC00018224000113.JPG"
The customer finally replied on.
Dated: 21 May 2020
(Please refer this email to the appropriate authority as per the following address)
To, (1) The Royal Sundaram General Insurance Co. Limited,
Registered Office: 21, Patullos Road, Chennai 600 002
And(2) No.2/319, Rajiv Gandhi Salai(OMR), Chennai - 600097.(3) Copy for Information to: @irda.gov.in(4) To the sender.
Dear Sir/s,
Your following reply email dated 20 May 2020, 1:13 PM received by the undermentioned customer but he finds none only an inappropriate attachment in your reply, in consideration of the most relevant policy# HC00018224000113.
However, since your said reply does not address any of the specific queries/questions raised by this customer in his last email to you dated 19th May 2020 - in response to your Renewal Advice - Notice for Withdrawal dated 18/05/2020 involving the existing policy No. HC00018224000113 of the customer, you are therefore, reminded to reply last email of this customer sent to you dated 19th May 2020.
Queries/questions in said email may be summaries as -
1(i) product brochure and sales brochure of the offered alternative product viz; Lifeline.
(Ii) mention amounts of respective premiums(age-wise) payable under the alternative product viz; Lifeline.
(Iii) in line with IRDAI regulation, how the Sum Insured(SI) of INR 100000 under the existing policy HC00018224000113 can fully correspond to the portability under the offered new policy viz. Lifeline whose Sum Insured(SI) is INR 200000(I.e. double the SI of the existing policy)?
How this customer reasonably liable or responsible for the outcome of said unviability of the product Health forever(HF)(Policy No.HC00018224000113)?
This customer requires reasonable clarification that how can your company, without providing prior intimation/notice to this customer and getting acceptance for said withdrawal from this customer, completely withdraw said product from market with effect from 1st October 2019, i.e. more than ten(10) months in advance from the date of future expiry of said Policy No. HC00018224000113 when said policy is still effective till 21/08/2020?Therefore, please address above summ
