SC Stays Order Directing Insurer to Pay Sreesanth’s Injury Compensation

A bench comprising Justices Vikram Nath and Sandeep Mehta ruled that United India Insurance Co. Ltd. while hearing the plea filed by the National Consumer Disputes Redressal Commission (NCDRC) against the April order.

“He (Sreesanth) did not play even a single day (in IPL 2012),” the bench observed.

While presenting the issue to the hearing, the court panel said, “Until a new order, the effect and operation of the disputed decision will be suspended.”

The NCDRC had passed the order on a complaint filed by Royal Multisport Pvt Ltd under the Consumer Protection Act, 1986, alleging that its insurance claim was wrongfully rejected by the company.

He stated that Royal Multisport Pvt Ltd had contracted the players of ‘Rajasthan Royals’ in the Indian Premier League (IPL) tournament in March 2012 and had taken a ‘special contingency insurance for player wage loss cover’ from the insurance firm for a total of ₹ 8.70 crore.

The NCDRC stated that under the policy, the insurance company is liable to pay Royal Multisport Pvt Ltd for loss of fees, wages and all other sums paid/payable to contracted players for their non-participation in IPL 2012, if such loss arises from circumstances covered under the policy, including injuries sustained during the policy period.

He also stated that the policy was implemented from March 28, 2012 to May 28, 2012.

The NCDRC noted that on March 28, 2012, Sreesanth suffered a knee injury in a friendly match in Jaipur and it was later concluded that he was unfit to play in IPL 2012 due to the injury.

Royal Multisport Pvt Ltd on April 23, 2012 requested the insurance company to process the claim for loss of player fees under the policy and filed a claim of Rs 82.80 lakh in September 2012.

The insurance company had appointed an adjuster to provide all medical reports and the adjuster’s report stated that the injury was caused by a ‘sudden, unforeseen and unexpected event’ and that the claim fell within the policy terms and conditions.

NCDRC stated that the claim was rejected by the insurance company on the grounds that Sreesanth had a pre-existing toe injury which was not disclosed by Royal Multisport Pvt Ltd (the insurance company).

The commission stated, “In case the fact of the knee injury is established by evidence such as x-rays, MRI reports and doctors’ expert opinion, denial based on pre-existing toe injury, which cannot be determined to have occurred/recurred within the insurance period, makes the denial a lack of service.” he said.

It directed the insurance company to pay Rs 82.80 lakh to Royal Multisport Pvt Ltd.