Letter received from Shri R K Pathak , our google group member , on the above subject is reproduced below.
Quote
Health Insurance – For protection of Health but of WHOM – BANK OR UIIC ????
Recently, IBA has issued communication No.
[ORDINANCE]
No.
CIR/HR&IR/J/2015-16/1169 dated October
1, 2016 to its Member Bank intimating the adamant attitude of UIIC
for not extending the policy for 30 days to enable IBA to discuss in its
Managing Committee & with Member Banks. IBA further advised to pay renewal
premium which is 112% higher and threatened Member Banks in the said
communication as “In the absence of renewal of the policy,
liability on account of hospitalization claims by employees post 30.09.2016
will have to be honored by banks.” [Ex-A]
In the communication of IBA, it is also mentioned that 15 banks have remitted
the premium for renewal as demanded by Insurer i.e. UIIC.
The efforts of IBA were supported by the workman Union
by advising their units on 1/10/2016 “ Our units in other Banks should immediately pursue the matter
with their management to ensure that the policy is not allowed to lapse
and employees do not get uncovered by the benefits of the policy.”[Ex-B] In the circular
of Workmen Union, it is reported that 18 Banks have paid the premium. i.e. 15
reported by IBA and 3 more, Federal, UCo and Vijaya Bank. This facts itself
reveals the role of Union to safe guard the Bank Employees to have continued
cover.
The Officer Organization too issued
communication to IBA on 1/10/2016 to get” renewal of the Insurance Policy as per the original terms
negotiated “and in the absence of which, IBA must decide
taking a legal recourse against the Insurance Company or approaching Consumer
Forum and also member Banks may immediately be
advised to honour the claims of the employees to the debit of their
establishment expenses. [Ex-C]
Let
us examine the facts from Insurance Company’s angle:-
S.NO.
|
NAME OF
BANK
|
ANNUAL
PREMIUM PAID IN 2015 RS.
|
CLAIMS PAID +
CLAIMS OUTSTANDING (INC.
DOMICILIARY) RS.
|
|
PUNJAB NATIONAL BANK
|
40,37,65,216
|
67,65,13,888
|
|
CANARA BANK
|
31,06,24,387
|
51,79,83,971
|
|
BANK OF BARODA
|
29,88,93,275
|
58,61,81,248
|
|
CENTRAL BANK OF INDIA
|
22,09,56,516
|
40,31,58,983
|
|
UNION BANK OF INDIA
|
21,31,98,633
|
33,90,46,777
|
|
INDIAN OVERSEAS BANK
|
18,92,47,347
|
38,27,57,998
|
|
BANK OF INDIA
|
18,63,19,972
|
28,70,16,534
|
|
SYNDICATE BANK
|
18,47,99,781
|
28,63,29,127
|
|
UCO BANK
|
14,39,94,675
|
24,06,62,496
|
|
ALLAHABAD BANK
|
14,38,72,601
|
22,94,43,092
|
|
OBC
|
12,58,39,603
|
23,9937,141
|
|
INDIAN BANK
|
11,98,10,828
|
21,25,38,425
|
|
ANDHRA BANK
|
11,95,38,950
|
18,74,82,060
|
|
CORPORATION BANK
|
11,02,76,098
|
19,01,51,540
|
|
SBH
|
10,75,34,013
|
20,32,98,907
|
|
UNITED BANK OF INDIA
|
9,75,40,012
|
14,84,61,564
|
|
BANK OF MAHARASHTRA
|
8,76,20,334
|
19,03,81,901
|
|
SBT
|
8,47,80,301
|
14,83,72,930
|
|
VIJAYA BANK
|
8,46,88,426
|
14,84,43,798
|
|
DENA BANK
|
8,24,41,180
|
15,88,05,543
|
|
SBP
|
7,55,84,531
|
10,58,07,890
|
|
FEDERAL BANK LTD.
|
6,81,15,359
|
12,48,61,938
|
|
SBBJ
|
6,72,32,061
|
9,62,45,240
|
|
PUNJAB & SIND BANK
|
6,63,97,355
|
11,35,35,087
|
|
SBM
|
5,36,43,675
|
11,51,67,889
|
|
SOUTH INDIAN BANK
|
4,49,34,101
|
5,65,21,669
|
|
KARNATAKA BANK LTD.
|
4,34,01,163
|
5,80,92,150
|
|
KARUR VYSYA BANK
|
4,10,87,795
|
5,48,09,199
|
|
THE J&K BANK LTD.
|
2,99,02,366
|
1,96,61,848
|
|
KOTAK MAHINDRA BANK
|
1,76,01,420
|
5,18,11,428
|
|
LAKSHMI VILAS BANK
|
1,65,63,348
|
2,93,35,849
|
|
DHANLAXMI BANK LTD.
|
1,34,55,536
|
3,28,62,400
|
|
CATHOLIC SYRIAN BANK
|
1,23,77,855
|
1,60,49,760
|
|
THE NAINITAL BANK LIMITED
|
46,01,214
|
94,39,643
|
|
THE RATNAKAR BANK LTD
|
28,42,889
|
85,84,845
|
|
CITI BANK
|
18,80,659
|
24,87,196
|
|
IBA
|
2,17,745
|
4,46,920
|
|
BNP PARIBAS
|
89,077
|
53,078
|
|
BANK OF AMERICA
|
62,625
|
1,26,875
|
Grand Total
|
3,87,57,31,924
|
6,67,28,68,825
| |
387 CRORES
|
667 CRORES
|
While reviewing the table, surprisingly at Sr.No.37, the employees of IBA (non registered organization) are also covered in the Health Insurance Policy. The Medical Insurance Scheme was negotiated during 10th Bipartite Settlement and is, therefore, a part of the same. The 10th Bipartite Settlement took place on 25/05/2015 between Trade Union o Banks & Voluntary Association of Management of Bank [IBA] and IBA signed this Settlement on having Mandate from the Bank.
In this context, it is not clear which Union / Officer Association represented IBA Employees in the settlement and which authority has given mandate to IBA to sign Settlement on behalf of IBA Management. Further signatures on the settlement, reveals signatures of Managements of Banks & Trade Union / Association, does not reflect even remotely that settlement also covers IBA Employees. Thus act of IBA to cover its own employees is not only ultravires but also in violation of IRDA guidelines on Group Health Insurance more particularly clause 7 A of Health Insurance Regulations 2016 [Ex-D] published in Government Gazette, which reads as under:-
“No Group Health Insurance Policy
shall be issued by any Insurer where a group is formed with the main purpose of
availing itself of insurance. There shall be clearly evident relationship as
specified by the Authority from time to time between the members of the group
and the group policy holder”.
The
above statement of premium and claim reveals the fact that Insurer has paid
claims 172.35% of the claim received amount. It is not clear how much amount is
contributed towards domiciliary treatment. Off course UIIC, which is in
business of Insurance since 1938, being commercial organization is not expected
to incur loss from the transaction and its act of increasing premium at renewal
seems to be obvious, though illegal, arbitrary and against not only terms of
contract [contract of
insurance] but IRDA directives too.
The
act of Insurer is illegal as it acts are violation of IRDA on following
counts:-
1]
Insurer cannot load premium more than 18% as agreed at clause 5.18 of the
Policy Issued by the Insurer.
2]
The act of the Insurer to revise premium upward with short notice is in
violation of policy term reflected at clause 8 which clearly states that “We
shall notify you of such changes at least three months before the revision are
to take effect”. Under
these circumstances the act of Insurer to deny extension of cover for 30 days
more to decide on renewal is absolutely illegal and arbitrary.
3] The act of the Insurer to enhance the
premium 112% at renewal is in violation of regulation 10 [C] of Health
Insurance Regulations 2016.
4]
The Act of Insurer to enhance the premium by 112% is in
violation of regulation 25 [ii] of Health Insurance
Regulations 2016.
Now
all the issue of enhanced premium of 112% has be raised at the time of renewal
without giving 3 months notice to policy Holder and dictating policy holder to
succumb to their illicit tactics.
Let
us now clear what Supreme Court Says about “Renewal” of policy:-
“A renewal of an insurance
policy means repetition of the original policy. When renewed, the policy is
extended and the renewed policy in the identical terms from a different date of
its expiration comes into force. In common parlance, by renewal, the old policy
is revived and it is sort of a substitution of obligations under the old policy
unless such policy provides otherwise. It may be that on renewal, a new
contract comes into being, but the said contract is on the same terms and
conditions as that of the original policy” [BIMAN
KRISHNA BOSE Vs. RESPONDENT: UNITED INDIA INSURANCE
CO.LTD. & ANR- Appeal (civil) 2296 of 2000]
The honorable J.
Khare & Patil further made it clear that “Where an insurance company under the provisions of the Act having
assumed monopoly in the business of general insurance in the country and thus
acquired the trappings of the State being other authorities under Article 12
of the Constitution, it requires to satisfy the requirement of
reasonableness and fairness while dealing with the customers. Even, in
an area of contractual relations, the State and its instrumentalities are
enjoined with the obligations to act with fairness and in doing so, can take
into consideration only the relevant materials. They must not take any
irrelevant and extraneous consideration while arriving to a decision.
Arbitrariness should not appear in their actions or decisions. In the
present case, what we find is that arbitrariness is writ large in the actions
of the respondent company when it refused to renew the mediclaim policy of the
insured on the ground of his past conduct i.e. having gone into litigation for
payment of his claim against the respondent company. We are, therefore, in
agreement with the view taken by the High Court that the order of the
respondent company refusing to renew the medi-claim policy of the appellant was
unfair and arbitrary”.
Further Apex court while allowing the civil
Appeal of Policy holder also allowed cost of Rs.5000/-. Incidentally, the
respondent in above Civil Appeal and Lead Insurer in IBA induced / Introduced
Health Insurance Scheme is UNITED INDIA INSURANCE only. Copy of the Judgment attached as
Ex- E.
On 19/06/2013, South Mumbai District
Forum ordered an Insurance Company [Pravin Shah Vs New India Assurance Company]
ordered to refund the excess premium charged through loading.
It is illegal to refuse renewal of policy. So
when an Insurance Company doesnot want to renew a policy that has become
onerous, it adopts the backdoor method of loading the premium excessively,
making it unaffordable for the insured, who may then voluntarily opt out. In
present case, UIIC is adopting the same route.
The IBA is
voluntary association of Management of Banks and is expected to act in the
Interest of Bank while dealing with the Insurer Company but on the contrary IBA
is compelling its member to renew the Health Insurance Policy and pay insurance
premium of Rs. 821 crores on renewal to UIIC .
IBA is so panic
for renewal of Health Insurance Policy and acting contrary to object for which
it is formed.
Enclosed Ex-F reveals that,
Insurer had paid claim 72 % of above premium but premium is loaded 112%. WHY
again 40% overloading???
·
BNP Paribas is eligible for 5 % discount but has to pay 112% more.
Click on the following links to view annexures referred above,
Unquote
Against High Court Orders for payment of 100% DA to pre 2002 pensioners, the Banks have moved Supreme Court to delay the payment. Why they not adopted the same standard to file a petition against the Insurance Company?
ReplyDeleteAgainst High Court Orders for payment of 100% DA to pre 2002 pensioners, the Banks have moved Supreme Court to delay the payment. Why they not adopted the same standard to file a petition against the Insurance Company?
ReplyDeleteIBA /Banks can still move to court against insurance company and make
ReplyDeleteInsurance company to reduce/ refund the excess insurance premium charged.
In case banks are not taking any steps apex retiree organisations have to take
this step.