Contract of Indemnity and Mental Health Care in India written by Mohammad Shuja Uzair student of NMIMS Kirit P. Mehta School of Law, Mumbai
Contract of Indemnity
The Indian Contract Act, 1872 provides for “specific contracts” from Sections 124 — 238. Among them is the Contract of indemnity under Sec. 124 according to which:
“A contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person, is called a contract of indemnity.”
E.g., K agrees to indemnify H counter to the costs of any events which say G may take against H with regards to a certain amount of money.
In simpler words indemnity means refuge or safety against compensation or loss and the aim of entering into an indemnity contract is to guard the indemnity holder against unanticipated losses.
Section 125 of the Act also provides certain rights to the indemnity-holder against the indemnifier given that the indemnity-holder acted within the scope of their authority. These include the right to:
• recover damages paid in a lawsuit
• recover costs suffered in defending such a lawsuit
• recover any amount paid under a negotiation
Almost every insurance other than that of the personal accident and life insurance are contracts of indemnity. A case can be filed right away upon non-fulfillment of performance, regardless of any actual loss. If the indemnity holder suffered any liability and it was absolute, he would be permitted to call upon the indemnifier to safeguard him from the liability by paying it off.
The study of the principle of indemnity in relation to insurance is of much significance as insurance is a means of social security and indemnity in this case reimburses the beneficiaries of the policies for their actual economic losses, within the limit of the policy’s amount.
Insurance cover and its need are growing with the growing complexity of life, and as a consequence, there is now a variety of insurance covers. One such insurance is for Mental health care.
Mental health issues have been disregarded in Indian society for the longest time. To date, the masses do sympathize when a famous personality speaks out with regards to their mental health, but it still is a stigma that is yet to be normalized through awareness and education. Or even when it is normalized, all they receive is unsolicited advice from their acquaintances on their issues rather than being referred to a professional. Thus it is very evident that mental ailments, unlike physical illnesses, are complex and are not very easily diagnosable. So, how does the law provide recourse for the affected? How does it play a vital role and guides treatment in an appropriate direction?
Mental illnesses and treatments have been speculated throughout history, and there were instances where some of them were treated with compassion but generally just with stigma, marginalization, and injustice. In India, different legislations regarding mental health were shaped by the British. Pre-independence, many parts of legislations were combined to form the Indian Lunacy Act, 1912, which borrowed a lot of its components from the English Lunatics Act, 1845. Post-independence, there was an aim to draft an updated mental health care act, but there was a delay and the statute took many years to be embraced. Conclusively, the Mental Health Act (MHA), 1987 came into force. Due to the lapse in the passage of the Act had a lot of loopholes in its provisions.
The Convention on the Rights of Persons with Disabilities (CRPD) was approved by UNGA in 2006 which India signed and ratified in the year 2007. The CPRD demanded the existing legislation be revised and replaced. This was eventually responsible for the passing of the Rights of Persons with Disabilities Act, 2016 and Mental Health Care (MHC) Act, 2017, respectively.
The National Mental Health Survey of India, 2015-16
Another key reason that the MHC Act, 2017 came into force is the National Mental Health Survey of India. This was executed by the National Institute of Mental Health and Neuro Sciences (NIMHANS), Bengaluru. The National Mental Health Survey of India-2016 was conducted on persons who were a part of 12 states of India. It included 34802 individuals and the response rate at households was 91.9%. The age distribution was akin to that of India’s 2011 Census. The objectives were to assess the occurrence and pattern of mental disorders, recognize the gap in treatment, and assess the effectiveness of the current mental health services.
The key takeaways were:
• Mental health issues were associated with a residence with the case in urban metros was more than in urban non-metro and rural areas.
• 1 out of 20 people in India suffers from depression.
• 1% of the population shows a high risk of suicide.
• The ones common among men were bipolar disorders and alcohol use disorders; meanwhile, depressive, stress-related, and neurotic disorders were common among women.
• Despite the works in providing mental health care, the research showed that a massive gap in treatment exists for all kinds of psychological problems. It ranges from 28% to 83% for mental health disorders and around 86% for alcohol use disorders.
• Despite the illness being present for more than 12 months, individuals suffering from such mental illnesses had not obtained any treatment. This was reported at 80%.
The stigma towards the mentally affected persons affects their access to work, education, and marriage and also affects their family members. Thus, the survey posed as a wakeup call and which needed immediate attention from the socio, political and legal spheres.
Mental Health Care (MHC) Act, 2017
The MHC Act received President’s assent on 7 April 2017 and initiated on 29 May 2018. The aim is to provide healthcare for individuals who suffer from mental illness and also to see that they have the right to live their life without being discriminated against.
Section 2(s) of the Act defines mental illness as “a substantial disorder of thinking, mood, perception, orientation or memory that grossly impairs judgment, behavior, capacity to recognize reality or ability to meet the ordinary demands of life, mental conditions associated with the abuse of alcohol and drugs, but does not include mental retardation which is a condition of arrested or incomplete development of mind of a person, especially characterized by subnormality of intelligence”.’
• Human Rights of people suffering from mental illness
Chapter V of the MHC Act, 2017, consists of the rights of those with mental affliction. Firstly, it ensures every individual has the right that enables them to access mental health treatment. The Act secures free treatment for persons who are Below Poverty Line or homeless. Every person with mental illness is guaranteed the right to live with dignity, equality, and non-discrimination. They shall also have the right to legal aid, right to information, right to privacy in terms of their mental healthcare, mental health, and treatment
• Advance Directive
Section 5, talks about an Advance Directive where an individual with mental ailment has the right to make a directive in advance, in writing that expresses how the person wants to be/not to be treated for the disease. It also states whom do they appoint as their nominated representative. The directive demands to be qualified by a medical practitioner or a professional listed with the Mental Health Board.
• Mental Health treatment
The Act requires the method to be adhered to for admission and treatment of mentally affected patients. For example, individuals suffering from mental illness cannot be endangered to electro-convulsive therapy without using anesthesia muscle relaxants. This therapy can also not be performed on minors. Anybody with mental illness cannot be chained in any manner under any instance, nor can they be put to solitary confinement.
The Insurance Regulatory and Development Authority of India (IRDAI) protects the interest and ensure impartial dealing to policyholders of the country. It also steps in to take action where insurance standards are ineffective or inadequate.
Thus, in 2018 the IRDAI ordered all insurers to conform with the MHCA, 2017’s provisions. Again, on 27 September 2019, the IRDAI issued a guiding principle and highlighted that the “treatment of mental illness, stress or psychological disorders and neurodegenerative disorders” are not allowed to be excluded in Health Insurance Policies.
On the surface level, few insurers have acted in accordance with the IRDAI procedures.
Recently, a PIL was filed in the Supreme Court on insurance coverage for mental illness treatment. The petitioner, Adv. Gaurav Kumar Bansal claimed that the delay of the IRDA to implement the provisions of the Act has hindered the rehabilitation process of thousands of persons with mental illness. The apex court asked insurance regulator IRDA to explain why insurers do not cover mental health under their regular schemes.
Mental Health Care Gap
There are a few explanations as to why the concept of Mental Health Insurance is very non-compliant regardless of legislation and guidelines.
• Assessment of risk — the concept of mental health insurance is very nascent and so the insurers struggle with guaranteeing and actuarial problems. The confusion is here is a loop, insurers have no idea about the costs involved and unless they don’t start providing it and people avail the same, they would remain not knowing the price and the process. Even though they cannot deny coverage, due to the guidelines, they haven’t standardized such policies yet.
• No standalone plans — the other reason is that there are no specific plans for specific mental illnesses, only exceptions.
Mental health issues, as said before, are really sensitive, and especially during unprecedented times like now, they cannot be side-lined. Living through a global pandemic can be very demanding. The coronavirus disease 2019 (COVID-19) epidemic may cause fear and anxiety due to the uncertainty about a novel disease. The thought about what can happen can be overwhelming for everyone. Public health measures, like social distancing, can make folks feel detached and lonely and can intensify stress. Ultimately these acts are obligatory to reduce the spread of COVID-19. But for one to reach out, they should be in a self-diagnosable situation where they realize they’re not alright. This is not the case with every mentally affected person, and the 2016 survey proves the same. India’s increasing mental health crisis can no longer be denied.
The ignorance towards mental health care is very evident as it is rarely mentioned in any election manifestos of political parties in India. On the other hand, ensuring the good health of citizens is a fundamental right guaranteed by the constitution.
The current need of the hour is to aggravate the common people to understand mental health. They need to know that they can insure themselves when it comes to mental illnesses as well.
The way forward
• Law reforms should go beyond papers and should provide actionable ideas that make the mental health care system all-inclusive within the public health care system umbrella. The mental health care gap should be filled. Until then, it can only be relied upon a time to tell the long-standing outcome of this MHC Act, 2017 and its functioning.
• There should be evidence-based tailoring for the next set of mental health policies, not leaving any kind of illness unnoticed.
• There should be a well accessible one-stop portal for mental healthcare so that people are well aware of their rights.
• Development in Health Information technology will provide for a decent scope for mental health policies in the country.
In order to do all the above, there is a need for a constant stream of funds. These will be used for enlightening, educating, and establishing awareness on matters concerning mental health and its long-lasting issues. The accessibility of professional help and timely intervention is very important. This demands a collaborative effort from all branches of the functioning society to change things over time.