Date of Filing:16/07/2021

Date of Order:16/06/2022

BEFORE THE BANGALORE I ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SHANTHINAGAR BANGALORE -  27.

Dated:16^th DAY OF JUNE 2022

PRESENT

SRI.H.R. SRINIVAS, B.Sc., LL.B. Rtd. Prl. District & Sessions Judge And PRESIDENT

SRI. Y.S. THAMMANNA, B.Sc, LL.B., MEMBER

SMT.SHARAVATHI S.M, B.A, LL.B., MEMBER

COMPLAINT NO.326/2021

Vs

ORDER

BY SRI.H.R. SRINIVAS, PRESIDENT.

1.     This Complaint is filed by the Complainant U/S Section 12 of Consumer Protection Act 1986, against the Opposite Party  (herein referred in short as OP) alleging the deficiency in service in repudiating the claim of the complainant regarding replacement of mitral valve in the heart to the extent of the sum assured i.e. Rs.5,00,000/- and for payment of the said amount and along with interest at 18% per annum on the same and Rs.5,00,000/- as compensation for the inconvenience, loss and mental agony caused to her and for other reliefs as this Hon’ble Commission deems fit. 

2.      The brief facts of the complaint are that: she purchased health insurance policy from OP on 18.07.2016 and the same has been renewed up to 08.08.2021 without any break. The sum insured under the said policy was for Rs.5,00,000/- the said policy covers for “11 critical illness mentioned in the policy and further the baseline cover includes a 48 months waiting period for preexisting conditions and 30 days initial waiting period from the inception.” On 20.01.2021 she got admitted to the CMI hospital for the surgery i.e. “redo sternotomy with mitral valve replacement mechanical prosthetic valve” and discharged on 29.01.2021.  In the hospital records the reason mentioned for admission is as “known case of rheumatic heart disease, S/P Mitral Valve replacement admitted for future management.  She was diagnosed for rheumatic heart disease, S/P Mitral Valve replacement, severe prosthetic valve stenosis, severe pulmonary hypertension, normal sinus rhythm, normal biventricular function and NYHA Class-III the surgery” was conducted and was discharged on 29.01.2021.

3.     It is contended that at the time of treatment, she sought for cashless facility in the said hospital. The hospital denied the request of the complainant for cashless facility on the ground that the insurance company has not cleared the dues of the hospital. She made the payment in respect of the bill raised by the CMH hospital to the extent of Rs.6,62,273/- and Rs.15,040/- being the amount of treatment.  She paid the said amount in cash and also by using her credit card.  After discharge, she made a claim with the OP whereas instead of settling the claim, OP rejected/repudiated her claim under letter dated 27.03.2021 stating that as per the submitted document “It was found incorrect good health declaration history, mitral valve replacement during 2010. It was found that you have not disclosed the same at the time of taking the policy and hence as per the policy terms and conditions this falls under non-disclosure and hence the claim stands repudiated in terms and conditions definition 12.  Hence she had to issue a legal notice demanding to pay the said claim.  OP after receiving the notice has sent an untenable reply reiterating that the claim is not payable”.  

4.     She has not at all got any treatment for mitral valve replacement either in 2010 or, prior or afterwards. It is not at all mentioned anywhere in the medical records that she has undergone Mitral valve replacement in the year 2010. On what basis, OP has incorporated the said reason to repudiate the legitimate and legal claim, is not forthcoming which shows the careless attitude and lethargic attitude of the OP in not settling the claim. Hence there is deficiency in service on its part.

5.     Further as per the policy terms 11 types of critical illness are covered and out of the said list, Open heart replacement or repair of heart valves also included. Hence she took treatment with CMI hospital and made the claim which is legal and OP liable to pay the said amount under the terms and conditions of the policy. Hence there is deficiency in service and unfair trade practice on the part of OP and prayed the commission to allow the complaint.

6.     Upon the service of notice, OP appeared before the forum through advocate one Dwaraka and filed the version. In the version it is contended that the complaint is not maintainable under the provisions of the Consumer Protection Act on the sole ground that the complainant do not fall within the meaning of Section 2(33) and 2(34) of the Consumer Protection Act, and further the claim of the complainant is on the false, frivolous and vexatious grounds. 

7.     It is contended that, the terms and conditions under which the insurance policy issued to the complainant was made known and adequately informed and the same has been acted strictly by the OP. 

8.     Further it is contended that a group health insurance policy bearing No.00215200202003 issued in the name of bank of Baroda and the complainant is the member of the policy under certificate No.120017866 for the time period from 09.08.2020 to 08.08.2021 for the sum insured of Rs.5 lakhs. At the time of obtaining the policy, the complainant failed to disclose the material fact in respect of the medical history of Mitral valve replacement during 2010 and this further substantiated by the blank questionnaire form submitted by the complainant at the time of processing the application to the OP.  That they have filed the screenshot of the questionnaire submitted online as per its Annexure-A. 

9.     When the information specifically asked for, not furnished, it is the obligation of the maker to provide true and full disclosure of the information.  The progress note dated 21.01.2021 issued by Manipal hospital, Discharge summary of Aster hospital for reasons for admission, and the outpatient record of Manipal hospital amplifies that she was having mitral valve problem 10 years ago, and the same was not disclosed.  As per the policy document clause 4, which provides for exclusions, in which, OP shall not be liable for any claim in connection with or in respect of the preexisting diseases and clause 5€ provide that if there is fraudulent declaration on the part of insured person, and policy shall void process fortified. The policy defines disclosure to information norm under clause 12 which means the policy shall paid and all premium paid thereon shall be forfeited to the company in the event of misrepresentation or misdescriptions of the material fact. Hence as there is nondisclosure of the mitral valves problem in 2010 itself by the complainant, while enrolling herself in the group health insurance, OP has repudiated the claim bearing No.624230 as per clause 4, 5 and 12 of the policy. Further the claim under No.624232 was also disallowed on account that inpatient hospitalization package charges are not covered under the terms and conditions of the policy.

10.   Since the complainant has violated the terms and conditions of the medical policy regarding non-disclosure of the pre medical condition, and as patient hospitalization package charges are not covered to the members, it repudiated the claim and prayed to dismiss the complaint by denying each and every allegations made against it in the complaint. 

11.   In order to prove the case, both parties have filed their affidavit evidence and produced documents. Arguments Heard. The following points arise for our consideration:-

1) Whether the complainant has proved deficiency in service on the part of the Opposite Parties?

2) Whether the complainant is entitled to the relief prayed for in the complaint?

12.   Our answers to the above points are:-

POINT NO.1  : IN THE AFFIRMATIVE.

POINT NO.2 :  PARTLY IN THE AFFIRMATIVE.

                       For the following.

REASONS

POINT No.1:-

13.   On perusal of the complaint, version, documents and evidences of both sides, it is an undisputed fact that the complainant obtained health insurance from OP in the year 2016 and has renewed from time to time up to 08.08.2021 by paying the premium prescribed by the OP. The said insurance covers 11 critical illness as mentioned therein with base line cover of 48 months waiting period for preexisting condition and 30 days initial waiting period from inception. 

14.   It is  not in dispute that the complainant was admitted to Aster CMI hospital  on 20.01.2021 for rheumatic heart disease, S/P Mitral Valve replacement, severe prosthetic valve stenosis severe pulmonary hypertension, normal sinus rhythem, normal biventricular function and NYHA class III she paid a bill of Rs.6,62,273/- and Rs.15,040/- towards here treatment.

15.   It is her case that the hospital refused to provide cash less entry and treatment as the Ops were due to the hospital in some other cases. After the operation and discharge, she made a claim with OP in respect of the amount spent by her for her treatment in the hospital, which was rejected /repudiated on the ground that she did not disclose the preexisting health condition i.e. the problem with mitral valve of her heart at the time of obtaining the insurance and hence has suppressed material facts which is violative of clause 4 and 5 and 12 of the policy, and further it is the case of the OP that complainant had a rheumatic heart disease, S/P Mitral Valve replacement 10 years back as per the progress note dated 21.01.2021 issued by Manipal Hospital in the year 2010 and hence not entitle for the insurance claim. 

16.   As stated above, the contention of the OPs are that complainant was having SP/MVR (Mitral valve replacement) 10 years back which was disclosed or came to its knowledge in the progress note mentioned by Manipal hospital dated 21.01.2021. We have gone through the entire documents filed and marked on behalf of OP i.e. Ex. R1 to R11 wherein, the said document dated 21.01.2021 of Manipal hospital referred to by the OP in the version is not forthcoming. Further there is no document worth believing is filed by OP to show that the complainant was  having mitral valves replacement /heart disease prior to obtaining the insurance policy in the year 2016 or on the date of filing of the proposal form to get the insurance.  Only the medical documents of Manipal hospital, the Sakra Hospital and Aster CMI hospital says that the complainant is a known case of rheumatic heart disease, S/P Mitral Valve replacement admitted for further management. There is no mention whatsoever regarding the time from which she was having the heart problem SP/MVR as contended by the OP.  OP have not made clear as to from what document it has come to conclusion that the complainant was operated SP/MVR in the year 2010. When such being the case, we have to hold that the repudiation of the insurance claim of Rs.5,00,000/- i.e. the insured amount in respect of the operation/surgery which complainant has undergone with Aster CMI hospital is on only on an assumption basis without any documentary proof.

17.   Even assuming for the moment that the complainant was having the heart problem prior to putting her proposal paper to get the insurance and as per the insurance policy, issued in the year 2016 itself, after 48 months of issuing the policy, even the preexisting diseases, health conditions are covered under the said insurance. And further the policy issued to the complainant also covers 11 critical illness mentioned therein and further the surgery which the complainant has undergone also falls within the said critical illness list. Under Section 45 of the Insurance Act OP cannot repudiate/objection the insurance policy after two years from the date of issue. The complainant admitted to the hospital on 20.01.2021 and got discharged on 29.01.2021 which is within the policy period. Hence we are of the firm opinion that the repudiation of the claim of the complainant amounts to deficiency in service besides unlawful, illegal and also amounts to unfair trade practice and  on the reason which is not at all exiting has been made for unlawful gain. Hence we answer POINT NO.1 IN THE AFFIRMATIVE.

POINT NO.2:

18.   In the result though the complainant has produced medical bill to the extent of Rs.6,62,273/- and Rs.15,040/-, since the cover under the insurance is only up to Rs.5,00,000/-, the complainant is entitle for the said amount, and interest at 12% per annum on the said amount  from the date of claim i.e. 29.01.2021 till the payment of the entire amount. Act of OPs put the complainant to mental tension, physical hardship and financial loss for which we direct OPs to pay Rs.50,000/- towards damages and Rs.15,000/- towards litigation expenses. If the damages and the litigation expenses of Rs.65,000/- in all not paid within 3 months, OP is further directed to pay interest at the rate of 12% per annum on the said amount.  Hence we answer POINT NO.2 PARTLY IN THE AFFIRMATIVE and pass the following:-

ORDER

1. The complaint is allowed in part with cost.
2. OP-1 and 2 are jointly and severally hereby directed to pay a   sum of Rs.5,00,000/- to the complainant along with interest at 12% per annum on the said amount  from the date of claim i.e. 29.01.2021 till the payment of the entire amount.
3. Further OPs are directed to pay Rs.50,000/- towards damage and Rs.15,000/- towards litigation expenses. If the damage and the litigation expenses of Rs.65,000/- in all not paid within 3 months OP is further directed to pay interest at the rate of 12% per annum on the said amount
4. OPs are hereby directed to comply the above order within 30 days from the date of receipt of this order and submit the compliance report to this commission within 15 days thereafter.

5. Send a copy of this order to both parties free of cost.

Note: You are hereby directed to take back the extra copies of the Complaints/version, documents and records filed by you within one month from the date of receipt of this order.

(Dictated to the Stenographer over the computer, typed by him, corrected and then pronounced by us in the Open Commission on this day the 16^th day of JUNE 2022)

MEMBER         MEMBER       PRESIDENT

ANNEXURES

1. Witness examined on behalf of the Complainant/s by way of affidavit:

Copies of Documents produced on behalf of Complainant/s:

Ex P1: Copy of the Aadhar card.

Ex P2: Copy of the Group health insurance policy with terms and conditions.

Ex P3: Copy of the Discharge summary.

Ex P4: Copy of the Hospital receipts.

Ex P5: Copy of the claim form.

Ex P6: Copy of the repudiation.

Ex P7: Copy of the legal notice.

Ex P8: Copy of the rejoinder.

Ex P9: Copy of the reply.

Ex P10: Copy of the renewed policy.

2. Witness examined on behalf of the Opposite party/s by way of affidavit:

RW-1: Shivakumar, Manager of OP.

Copies of Documents produced on behalf of Opposite Party/s

Ex R1: Copy of the Authorisation letter.

Ex R2: Copy of the policy and terms and conditions

Ex R3: Copy of applicant information proposer

Ex R4: Copy of  the claim form

Ex R5: Copy of Manipal Hospital report.

Ex R6: Copy of Manipal Hospital out patient record with bills.

Ex R7: Copy of  the Sakra World Hospital records and medical bills.

Ex R8: Copy of the Aster CMI Hospital record with medial bills.

Ex R9: Copy of the Discharge summary issued from Aster CMI Hospital.

Ex R10: Copy of the claims reimbursement check list.

Ex R11: Copy of the Member reimbursement statement form claim.

MEMBER         MEMBER       PRESIDENT

RAK*