Date of Decision :  21.08.2014

First Appeal No.466/2011

(Arising out of the order dated 15.07.2011 passed by the District Consumer Dispute Redressal Forum (East), Convenient Shopping Centre, Saini Enclave, Delhi, in Complaint Case No. 820/2011)

National Insurance Co. Ltd.

(Through its Delhi Regional Office-II)

2E/9, Jhandewalan Extension,

New Delhi-110054                 ……Appellant

VERSUS

Smt. Babli Dhar

W/o Sh. A.K.Dhar

R/o Plot No. 200/06, Flat No. F-1,

Sector-3A, Vaishali

Distt. Ghaziabad U.P.         …..Respondent

CORAM

S.A.Siddiqui, Member (Judicial)

S.C.Jain, Member

1.     Whether reporters of local newspaper be allowed to see the judgment?

2.      To be referred to the reporter or not?

S.A.Siddiqui, Member (Judicial)

Judgment

1.      This is an appeal under section 15 of Consumer Protection Act 1986 against the order dt. 15.07.2011 passed by the District Consumer Dispute Redressal Forum (East) Convenient Shopping Centre, Saini Enclave, Delhi in Complaint Case No. 820/11.
2.      Brief facts of the case relating to this appeal are that the respondent/complainant purchased a medi-claim policy from National Insurance Company Ltd-Appellant and paid premium of Rs. 6,748/- and the policy bearing No. 361701/48/08/8500000343 was issued which was valid for one year w.e.f.28.05.2008 to 27.05.2009.  The complainant Smt. Babli Dhar suffered prolonged bleeding after her LMP and consulted Gynecologist.  She was advised hospitalisation and surgery.  Accordingly, the complainant was hospitalised on 02.03.2009 and was discharged on 07.03.2009 after operation.  A bill for a sum of Rs. 30,910/- was raised, which was paid by the complainant to the hospital.  The Complainant had to undergo operation for removal of uterus, both the fallopian tubes and ovaries which in medical terminology is called TAHBSO.  The case of complainant was that the appellant/OP insurance complainant refused the cashless treatment as it did not make the reimbursement of the bills.  The payment was refused on the ground that the risk of hysterectomy was not covered during the two years from the date of issuance of the policy as per the terms and conditions of the insurance policy.  The respondent/complainant therefore served legal notice to the OP on 18.06.2009 calling upon the OP to reimburse the hospital expenses.  Since the Respondent/OP did not comply, consumer complaint was filed against the insurance company for directions to make payment of Rs. 30,910/- alongwith interest, compensation and costs of litigations.
3.      The appellant/OP filed written statement denying the entire allegations of the complaint.  It was alleged that the complainant’s claim was referred for opinion of the empanelment Doctors alongwith all necessary papers relating to treatment.  The claim was found inadmissible because the risk of hysterectomy was not covered for the first two years of issue of the policy.  Hence the claim was repudiated.  It was maintained that the repudiation of the claim was in accordance of the terms and conditions of the policy which was binding upon both the sides.  There was no deficiency of service whatsoever on the part of the respondent/OP. 
4.      Complainant filed rejoinder refuting the allegations of the OPs and reiterating the complaint case.  The parties led evidence in support of their cases.  The Ld. District Forum evaluated the evidence on record and came to the conclusion that repudiation of the claim of the complainant not only amounted to deficiency of service but also tantamounts to indulgence of unfair trade practice.  The terms and conditions were not notified to the customers prior to the purchase of insurance policy.  The complaint was therefore allowed and the OP was directed to make payment of Rs. 30,910/-. Besides, OP was also directed to pay a sum of Rs. 5000/- as compensation for mental pain and agony and litigation costs of Rs. 3,000/- was also awarded.
5.      The OP insurance company felt aggrieved and preferred this appeal inter-alia on the main ground that “parivar medi-claim policy does not cover treatment of hysterectomy during the first two years of inception cover”.  Since the terms and conditions of the insurance policy were clear and unambiguous and was binding therefore repudiation of the complainants claim for reimbursement of the hospital expenses did not amount to any deficiency in service.  The finding of the District Forum is erroneous and without application of judicial mind.
6.      The Ld. District Forum further failed to appreciate that after suffering for prolonged bleeding, respondent/complainant was admitted to Narender Mohan Hospital on 02.03.2009, the surgery was performed on 03.03.2009 and uterus alongwith fallopian tubes and ovaries were removed.  The clinical name of surgery was Hysterectomy (TAHBSO), which is an admitted fact.  The matter was referred to TPA which comprises team of experts in the field of medical profession, who settle the claims on the basis of the medical report, discharge summary, treatment details etc.  The TPA after scrutinizing medical documents came to the conclusion that the claim was not covered for the first two years of the policy.  On this ground alone the cashless facility was denied and claim was rejected.  The complainant was accordingly informed.  Thus there was no question of adoption of unfair trade practice or deficiency in service.  The impugned order dt. 15.07.2011 passed by the Ld. District Forum therefore suffers from illegality and deserves to be set aside.  The impugned order is not only arbitrary but malafide having been passed against the facts and circumstances of the case.
7.      The respondent/complainant filed reply.  It was submitted that the appeal was time barred as it was filed with delay of 107 days without any proper application for condonation of delay.  It was liable to be dismissed on this ground alone.
8.      It was an undisputed fact that the patient was surgically operated.

1. Removal of uterus, its surgical name is Hysterectomy.
2. Removal of both fallopian tubes is clinically known as bilateral saplingo.
3. Removal of both ovaries clinically known as bilateral Oopherectomy.

1.      Thus surgery is Total Abdominal Hysterectomy with bilateral saplingo Oopherectomy in short TAHBSO, but the appellant cleverly tried to misguide the State Commission by mentioning TAHBSO as simple Hysterectomy.  This amounts to misrepresentation on the part of the appellant.  It has also to be kept in mind that TPA being franchisee of the insurance company deliberately suppressed the fact of TAHBSO by mentioning the same as Hysterectomy.  This was deliberately done to indirectly cause undue benefit to the insurance company.  Moreover, the terms and conditions were neither disclosed to the insurer before taking the policy nor the same were signed by the complainant.  Therefore, it has no binding effect. It was emphasised that it is not a simple case of Hysterectomy, but was TAHBSO which is much broader term and Hysterectomy is a smaller part of TAHBSO.  It was therefore submitted that the Ld. District Forum was fully justified in passing the impugned order.  It did not commit any illegality or irregularity while passing the impugned order.  The appeal is without force and is liable to be dismissed.
2. We have carefully heard the Ld. Counsel for the parties.  Sh. Nitesh, Advocate was heard at length for the appellant while Sh. R.P.Bhardwaj appeared for the respondent.
3. It was argued on behalf of the appellant/OP insurance company that the appeal was not time barred. The certified copy of the judgment was received by the OP on 08.08.2011 and the appeal was filed on 07.09.2011 well within 30 days period prescribed under the Act for filing the appeal.  The Ld. Counsel for the appellant referred to the terms and conditions of the insurance policy which is available on record.  Exclusion clause has been provided under clause 4.  Clause 4.3 this provides that during the first two years of the operation of the insurance cover, he expenses on the treatment and disease such as cataract, benign prostactic hypertrophy, hysterectomy.....are not payable.  The respondent/complainant was undisputedly operated upon for hysterectomy. Therefore, the case fell under the exclusion clause 4.3.  Thus the claim was rightly repudiated.  There was no question of any deficiency in service.
4.   On the other hand, the Ld. Counsel for the respondent argued that at the time of selling the insurance policy the agents of the insurance companies do not properly explain the terms and conditions of the policy.  They only discuss the benefits under the policy. They are always found in a hurry to collect the premium and do not bother for anything else. When a claim is preferred, the insurance company emphasise the binding nature of the terms and conditions upon the insurer and the insured. Moreover, the complainant had never signed the terms and conditions nor they were explained or discussed; therefore these terms and conditions cannot have binding effect upon the complainant.  Three rulings were referred in support of the arguments.

1. United India Insurance Company Ltd. V/s MKJ Corporation III (1996) CPJ 8 SC.
2. United India Insurance Company V/s Pushpalaya Printers 04 CPJ 22 SC.
3. RP-1298/2014 Apollo Munich Health Insurance Co. Ltd. & Anr. V/s Mrs. Kirti and Anr. NC decided on 01.04.2014.

In United India Insurance Company Ltd. case the Hon’ble Apex Court held “It is a fundamental principle of Insurance Law that utmost good faith must be observed by the contracting parties.............Just as the insured has a duty to disclose,” similarly, it is the duty of the insurers and their agents to disclose all material facts within their knowledge, since obligation of good faith applies to them equally with the assured”.  The Counsel further argued that the exclusion clause relied upon by the appellant was not binding upon the respondent and the impugned order was just and proper and was liable to be maintained. 

1.         It is true that law relating to insurance was based on principle of uberrimea fidei i.e. utmost good faith.  This was equally applicable to both the parties.  Just as the insured has a duty to disclose everything in their knowledge it was also the duty of the insurer and their agents to discuss all material facts within their knowledge.  It is a fact that the agents of the insurance company always bother to collect premiums from the insured. They highlight the benefits under the policy shrewdly by passing the negative part of the policy since the exclusion clauses are of the negative side of the policy they are hardly told to the insured though it is the bounden duty of the insurance company/their agents to discuss all material facts.  This is hardly done.  Further, it is a fact that treatment of Hysterectomy during the first two years is not cover under the policy, but, the present case was not a simple case of Hysterectomy i.e. removal of uterus surgically, but was a case of TAHBSO, which was much broader term than simple Hysterectomy. 
2. Thus we do not find any illegality or irregularity in the impugned order dt. 15.07.2009. The appeal is therefore found without force and is accordingly dismissed.
3. Let copy of the judgment be provided to the parties free of cost as per law and thereafter file be consigned to record room.
4. FDR if any deposited by the appellant shall be released as per rule.