BEFORE THE   A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD

F.A.No.56 of 2013  AGAINST C.C.No.98 of 2012, DISTRICT FORUM, Kadapa Y.S. R. District

Between                                          

 M/s Cholamandalam MS General Insurance Co. Ltd.,

 Rep. by its General Manager, II Floor 163,

 Thambu Chetty Street,

 Paris Corner, Chennai – 600 001          ….. Appellant/OP No.2

And

01     Boyapati Durga Kumari,

W/o Alaparti Pitchaiah Choudary,

Residing at D.No. 42/169, NGO Colony,

Kadapa – 516 002.                              …..Respondent/ Complainant.

02.    M/s Indus Ind Bank Ltd.,

Rep. by its Branch Manager,

1^st floor, Sairam Towers,

Srihari Rao Street,

Nagarajupet, Kadapa  ..516 001..  .. Respondent/opposite party No.1

Counsel for the Appellant      :               M/s. A. Ramakrishna Reddy

Counsel for the Respondents   :             Sri V. Sreenivasa Rao for R-1      

                                                        M/s. V. V.S. N. Raju for R-2

   QUORUM:       

HON’BLE SRI JUSTICE GOPALA KRISHNA TAMADA,

     HON’BLE PRESIDENT

AND

SRI  R. LAKSHMINARASIMHA RAO, HON’BLE MEMBER        

Tuesday, the Seventeenth Day of June

TWO THOUSAND FOURTEEN

                Oral Order ( As per R.Lakshminarasimha Rao, Hon’ble Member)
                                                  ***

01.            The second opposite party is the appellant.  The appeal arises out of order passed by  the District Forum, Kadapa passed on 04.10.2012 in CC No. 98 of 2012.

02.            The facts of the case as seen from the averments of the complaint are that the first respondent joined as a member and obtained the following three insurance policies from respondent no. 2  and paid onetime payment of premium. 

And the second respondent issued a membership card for third policy with membership no. A512769A. On  22.11.2011, she  joined in Apollo Hospital in Hyderabad  for pain in both knees and it was diagnosed as Osteoarthritis and the complainant underwent TKR of both knees with Zimmer Prosthesis on 23-11-2011.

03             The respondent no.1 submitted that the officer of the appellant insurance company  assured her that the 3^rd policy would come into operation and the entire amount should be paid  on “cashless basis”.   On  22-11-2011 the doctors informed the respondent no.1  that cashless treatment was declined by the appellant  and hence, they insisted for payment of Rs. 4,00,000/- and with great difficulty she  arranged for the amounts.   On 26-11-2011 she was discharged after payment of total amount of Rs. 4,12,982/-.  The surgery was successful.  She  suffered a lot on account of mental stress and agony even after discharge due to hostile attitude of both the respondents.  After discharge from the hospital, the respondent no. 1 made attempt to contact the officer of the appellant insurance company who gave reluctant replies.

4.                On 12-12-2011 the complainant submitted claim form to the appellant  for a sum of   Rs. 4,12,982/-.  The appellant   repudiated the claim vide letter dt. 19-12-2011 on the ground  that the 3^rd policy was treated as a fresh policy in view of six months break for renewal period and further treatment was for pre-existing disease and as such  the claim would fall under exclusion clause.   The appellant  did not raise any objection while issuing 2^nd policy though it was obtained much earlier to the expiry period of 1^st policy and there were no objection or special conditions while issuing the 3^rd policy.  So the exclusion clause would not attract as mentioned in the repudiation letter. 

5.             The membership card was an evidence regarding acceptance to perform their part of contract of insurance.  The  doctors who treated at Apollo Hospitals, Hyderabad issued certificates showing   that knee ailment was not pre-existing disease. Repudiation of the claim on flimsy grounds amounts to deficiency in service and unfair trade practice. Hence the complaint to direct the respondents to pay Rs. 4,00,000/- together with interest @ 18% p.a. from 26-11-2011 till the date of realization, Rs. 4,00,000/- towards compensation for mental agony and financial inconvenience and Rs. 2,00,000/- against R1 for deficiency of service and unfair trade practice and Rs. 5,000/- towards costs and discontinue unfair trade practice.

6.             The appellant resisted the claim on the premise  that on receipt of the claim intimation the appellant called for consultation.  As per consultation paper dt. 19-11-2011 the respondent no. 1 came to hospital with history of pain in the knee since six months which gradually increased since one month and since six months she was taking self medication.  The duration of the symptoms of the present ailment was for six months which was prior to inception of the policy dt. 14-10-2011.    As such  the present ailment was a pre-existing disease and hence, it was repudiated on the ground that “no indemnity is available or payable for clams directly or indirectly caused by arising out of or connected in the following any pre-existing condition  benefits will not be payable for any conditions as defined in the policy, until 24 consecutive months of coverage for the insured person have elapsed, since inception of the first policy with the insurer”.

07                The earlier policy of the first respondent  was expired on 21-4-2011 and the complainant would be eligible for continued benefit, if the policy would be renewed within 15 days of the expiry the policy was  renewed after break of five months and hence, she was not eligible for continued benefit as per terms and conditions of the policy.  Since there was break of six months in 2^nd and 3^rd policies, the current policy was considered also as a fresh policy.   As the respondent no.1  had not availed 24 months consecutive coverage the current policy was considered as fresh and she was not eligible for the  benefit under the policy.   Therefore, the claim was repudiated.  There was no deficiency of service and unfair trade practice on the part of the Respondent.  There was no cause of action and hence, the complaint may be dismissed with costs.

08.             Though the notice was served on the respondent no.2  there was no representation for it, respondent no. 2 was set exparte.

09.            The District Forum allowed the complaint directing the appellant  to pay Rs.4,00,000/- with interest @ 9% pa from 26.11.2011 till the date of realization, Rs.2,00,0000/- for mental stress, agony and financial inconvenience and Rs.1,000/-towards costs and it directed the respondent no. 2 to pay Rs.2,00,000/- for deficiency in service and unfair trade practice and Rs.1,000/- towards costs within 45 days.

10.            Feeling aggrieved by the order of the District Forum, the second opposite party preferred this appeal contending that the District Forum failed to appreciate the fact that the first respondent  has  suppressed her  pre-existing disease of pains at knee points suffering from more than six months. The third policy was taken after five months of the expiry of the second policy on 21.04.2011. It should be renewed within 15 days and  it was renewed only  after five months and hence it has to be treated as fresh policy. Since the first respondent is suffering from pre existing disease and that the third policy was not in force, hence her claim was repudiated as per the terms and conditions of the policy and hence prayed for setting aside the impugned order and dismiss the complaint against it.  
 

11.            The learned counsel for the respondent has filed written arguments.

12.            The point for consideration is whether the order of the District Forum is vitiated by mis-appreciation of facts or law ?

13.            The facts beyond any dispute are that the respondent obtained Indus Family health silver plan policy bearing No. IBL – silver 000520 for an assured sum of Rs. 2 lakhs for the period commencing from 15.06.2009 till 14.06.2010. She had also obtained Health Master Policy on 07.07.2009. besides the two insurance policies, the respondent obtained Indus Family Health Platinum Plan Insurance policy for the period from 22.4.010 to 21.4.2011.  There is no dispute between the parties in regard to payment of the premium and  the operation of the Insurance policies.

14             The respondent submitted claim for Rs.4 lakhs in respect of Indus Family Health Platinum Plan Insurance policy and the appellant repudiated the claim on 19.12.2011 on the premise that the insurance policy was treated as fresh policy on account of six months break in getting it renewed and on the ground that the illness for cure of which she had undergone treatment is a preexisting disease.  The respondent, as seen from discharge summary of Apollo hospital, Hyderabad was admitted on 27.11.2011 with complaint of pain in her both knees,  difficulty in climbing stairs, squatting and sitting cross legged position and she was diagnosed with suffering from osteoarthritis in both the knees and she had undergone total knee replacement of both knees on 23.11.2011 and she was discharged from the hospital on 26.11.2011.

15             The appellant repudiated the claim on the premise that the signs and symptoms of the knee ailment was existing since six months i.e., prior to inception of the policy and as such the ailment was considered as preexisting ailment.  It is true that there has been break of six months for renewal of the insurance policy in question and fresh policy does not cover any  preexisting ailment.  The obligation is cast on the appellant insurance company would show that the knee ailment that the respondent suffered is a preexisting ailment.  The appellant has not produced any documents in support of its contention and in order to show that repudiation of the claim is not arbitrary nor against any documentary evidence.

16             The  first  respondent has brought on record certificate issued by the doctor of Apollo Hospitals.  The certificate was issued on the request made by the appellant and it goes to show that the respondent was suffering from the knee ailment for about six months which was gradually onset and increased a month prior to the respondent’ admission to the hospital.  There is no contra evidence to the certificate issued by Apollo hospital. The Certificate was issued to the Medical incharge of Insurance company and not at the request of the respondent no.1 and thus the  certificate carries much weight in the back drop of its issuance on the request of the appellant insurance company and in absence of any oral or documentary evidence in contradiction of the observation made therein.  As such, we do not find any justification of  the repudiation of the claim on the premise of the knee ailment as a preexisting disease.

17             The learned counsel for the respondent has placed reliance on the decision of the Hon’ble National Commission in “  HDFC Ergo General Insurance Company Ltd Vs. Rachhpal Singh “ I (2013) CPJ 644  and             “ Praveen Damani Vs oriental Insurance Company Ltd “ in RP No. 1696 of 2005 decided on 03.10.2006.   In Rachhalpal Singh (supra),  the Hon’ble National Commission while dismissing the petition to condone delay, held “ Insurance company is duty bound to supply the terms and conditions of the insurance policy to the respondent. The decision is  of  not much assistance to the case of the appellant as it is not her case that immediately after receiving the insurance policy she had raised objection as to non supply of terms and conditions of insurance policy more so in the back drop of her  rendering service as member of District Forum.

18              The other decision viz., Praveen Damani dealt with a case where the insurance policy had a clause stating that it is not material whether the insured had knowledge or not and even existing of symptoms of the disease prior to the effective date of insurance enabling the insurance company to disown its liability is not valid and the insured was unaware of the disease at the time of taking the policy.  The Hon’ ble National Commission allowed the revision filed by the insured with the following observations :

“most of the people are totally unaware of the symptoms of the disease that they suffer and hence they cannot be made liable to suffer because the Insurance company relies on their Clause 4.1 of the policy in a mala fide manner to repudiate all the claims.  No claim is payable under the mediclaim policy as every human being is born to die and diseases are perhaps preexisting in the system totally unknown to him  which he is genuinely unaware of them. Hindsight everyone relies much later that he should have known from some symptom.  If this is so every person should do medical studies and further not  take any insurance policy “.

19             In the aforementioned decision the  National Commission  held that the Insurance company failed to bring any material on record to show that the insured had symptoms at the relevant time.  In the case on hand, the respondent had no such symptoms relating to knee ailment which can be described as a preexisting symptom.  The appellant has failed to support it repudiation of the claim.  We do not see any reason to interfere with the order of the District Forum in regard to the deficiency in service on the part of the appellant insurance company.

20             The District Forum has awarded an amount of Rs.4 lakhs towards the sum assured under the Insurance policy with interest @ 9% pa from the date of discharge of the respondent from Apollo Hospital.  The District Forum has awarded an amount of Rs. Two lakhs for mental stress, agony and  financial inconvenience suffered by the respondent no.1. Besides the amount, the District Forum has also awarded a sum of Rs. Two lakhs against the respondent no.2-bank towards deficiency in service and unfair trade practice on the part of the appellant.  We do not see any reason in awarding Rs.2 lakhs each against the appellant and the respondent no.2 towards compensation.  In absence of any appeal preferred by the respondent no.2-bank, we do not intend to interfere with the award of Rs.2,00,000/- granted as compensation against the respondent no.2.   Therefore,  the relief for Rs. Two lakhs granted as compensation against the appellant is liable to be set aside. 

21             In the result, the appeal is partly allowed. The order of the District Forum is modified. The relief for compensation of Rs.2,00,000/- granted against the appellant/2^nd opposite party is set aside. The rest of the order is confirmed. There shall be no separate order as to costs. Time for compliance four weeks.

                                                                PRESIDENT

                                                                MEMBER

                                                                DATED :  17.06.2014.