order dated 07/07/2009<br /> <br /> O R D E R<br /> <br /> M.R. DEVAPPA, PRESIDENT. <br /> <br /> The case of the complainant is as follows:<br /> <br /> 1. That the complainant’s husband has obtained a health insurance policy from the OP after paying a total premium of Rs.2929/- on 30.06.2007 and the same was in force till 29.06.2008. <br /> <br /> 2. That the OP as per the terms and conditions under took to indemnify the medical expenses.<br /> <br /> 3. That in the week of November 2007 the husband of the complainant fell ill and suffered from high grade fever and developed cough later for which he was treated at Virajpet initially and later he was shifted to Basappa Memorial Hospital Mysore where he was admitted as inpatient on 7.11.2007. It was diagnosied that the husband of the complainant was suffering from “Malignant Pleural Effusion” and the patient was treated for the said ailment till 15.11.2007. <br /> <br /> 4. As there was no improvement he was taken to Bangalore and admitted in Bhagavan Mahaveer Jain Hospital, Bangalore on 1.12.2007 for further treatment and he was there till 25.12.2007 where he died.<br /> <br /> 5. The complainant being wife has spent more than 3 lakhs on her husband namely K.K.Charmanna. <br /> <br /> 6. That the complainant informed the OP insurance company and requested for cash less facility. But the OP refused to provide cash less facility by assigning inappropriate reason and therefore the complainant was forced to pay the hospital bills which came to 3 lakhs Rupees, though the complainant submitted original discharge summary of B.M.Hospital Mysore as demanded by the OP and also sent the required documents sought by the OP. <br /> <br /> 7. Hence, the complainant prayed for following reliefs:<br /> <br /> 7.1 To reimburse Rs.3,00,000/- to the complainant towards the medical expenses and other incidental expenses incurred by the complainant on treating K.K.Charmanna, the insured with interest at the rate of 12% p.a. till realization.<br /> 7.2 To pay compensation to an extent of rs.50,000/- to the complainant for the mental agony caused to the complainant and also for expenses incurred on legal proceedings.<br /> <br /> 8. Upon admitting the complaint notice was ordered to be sent to the OP and on receipt of the Notice the OP has appeared through his advocate and has filed the version and later the affidavit evidence in lieu of examination in chief and has taken the following contentions:<br /> <br /> 8.1 That the complaint is not maintainable either in law or in fact and as such it is liable to be dismissed. That it is admitted that the OP has issued a health insurance policy and the same is issued subject to terms and conditions, exclusions and exceptions mentioned therein. <br /> <br /> 8.2 That it is not admitted that the complainant has intimated about the treatment taken to the OP. <br /> <br /> 8.3 That as per the documents submitted, the deceased has a history of melonoma in 2005 and he was suffering from MATA STATIC CARCINOMA-MELENOMA in lungs and it is otherwise is called as cancer at the beginning stage and it is also called Malignant Melenoma because it spreads to other area of the body. Therefore expenses incurred towards any pre-existing disease and its complications are not payable under the policy as the same was not declared by the complainant’s husband at the time of sending the proposal form.<br /> <br /> 8.4 That the averments made in para 4 and 5 of the complaint are not admitted because prior to taking treatment at network hospital the party must take steps to obtain pre-authorisation by way of sending the return form and then the insurance company will provide the benefit and the party however not required to pay the medical expenses directly to the network hospital, but the OP will indemnify the expenses by paying the amount to the hospital authorities and the company reserves right to review each claim for medical expenses and accordingly coverage will be determined according to the terms and conditions of the policy and in this regard the complainant has to prove all facts narrated in para 4 and 5 with the documents. <br /> <br /> 8.5 That the above facts came to the knowledge of the OP only after receipt of the notice from this Hon’ble Forum. As the complainant failed to discharge her obligation blame cannot be thrown on the OP as the company has done any deficiency in service. <br /> <br /> 8.6 If the holder of the policy is died some one claiming the benefit on behalf of the deceased must inform the company in writing immediately and send the copy of the Post Mortem with in 14 days, but the complainant has failed to do this.<br /> <br /> 8.7 That it is well settled law in field of insurance that contract of the insurance is a special type of contract based on ut most good faith and every fact of materiality must be disclosed. If deceased has disclosed the disease with which he was suffering the OP would not have accepted the proposal form and issued the policy. <br /> <br /> 8.8 For the foregoing reasons the OP pray for the dismissal of the complaint as they are not liable to indemnify the medical expenses incurred by the husband of the complainant.<br /> <br /> 9. The complainant apart from filing his affidavit evidence has also submitted the documents for perusal<br /> a) Insurance Policy issued by the respondent<br /> b) Broucher published and issued by the respondent.<br /> c) Case summary and discharge record issued by B.M.<br /> Hospital, Mysore.<br /> d) C.T.Scan report.<br /> e) Lab report.<br /> f) Requisition dt.1.12.2007 to the respondent.<br /> g) Letter from the respondent denying cashless facility<br /> To K.K.Charamanna. <br /> h) Death Summary issued bty B.M.J. Hospital, Bangalore<br /> i) Copy of death certificate.<br /> j) Letter dt.24.3.2008 isued by the respondent to the<br /> Complainant.<br /> k) Letters from B.M.J.Hospital, Bangalore seeking advance<br /> Payment form the complainant – 3 Nos<br /> l) Cash bills – 101 Nos<br /> <br /> 10. Like the OP has filed the true copy of the insurance policy and case summary and discharge card for perusal. Star package proposal form, fine needle aspiration, aytology report, C.T.Scan of thorax report.<br /> <br /> 11. Having regard to the averments made in the complaint and defense taken by the OP the following issues arise for determination. <br /> <br /> 1. Whether the OP has committed deficiency in service in repudiating the claim of the complainant?<br /> <br /> 2. To What order?<br /> REASONS<br /> <br /> 12. It is the case of the complainant that her husband never knew that he was suffering from Melenoma since 2005 but only came to know when her husband was diagonised in Basappa Memorial Hospital, Mysore and her husband died due to melegnency melenoma foot multiple lung secondaries (RT) melegnant pleural effusion in 2007 and it is submitted by the advocate of the complainant that there is no nexus between the disease suffered by the husband of the complainant and the cause of death.<br /> <br /> 13. It is further submitted by the advocate for the complainant that the OP has not placed any materials to show that the complainant’s husband before sending the proposal and at the time of answering the queries it was with in the knowledge of the deceased (Insured). Had the complainant’s husband knew the same he would have mentioned in the proposal form but the same was not with in his knowledge he did not answer the queries positively as he was not suffering from any disease, then i.e, in the year 2005. <br /> <br /> 14. It is also argued by complainant’s advocate that the OP-Insurance company is bound to furnish the list of network hospital to the policy holders. But in this instant case the insurance company has failed to furnish the list of Net work hospital at the time of issuing the policy nor even after issuance of policy to the complainant’s husband. Therefore on the ground that the complainant’s husband failed to obtain pre-authorisation at the time admission to the hospital from the OP-Company and therefore on that ground the OP company ought not to have repudiated the claim but need to have extended the cash less benefit to the complainant. <br /> <br /> 15. As against the above submission, the advocate for the Opposite Party has submitted the written arguments and taken several contentions.<br /> <br /> 16. It is submitted prior to taking treatment and for incurring medical expenses at a network hospital the policy holder must request for pre-authorisation by way of written form. But the policy holder has not sent any form for obtaining pre-authorisation and with out obtaining pre-authorisation straight away has taken treatment unilaterally and since the complainant has failed to inform the OP well in advance neither the deceased nor his wife has failed to discharge the obligation.<br /> <br /> 17. It is submitted by the advocate of OP that the medical records disclose that the complainant’s husband had been suffering from Melenoma since 2005 and as such he ought to have disclosed the same in answering the queries in the proposal form and therefore the contract has become null and void and as such the complainant cannot enforce the contract entered in to by the complainant’s husband and the insurance company(OP) and as such the complainant is not entitled for reimbursement of medical expenditure. <br /> <br /> 18. The counsel for the OP has relied two citations. In both the case law it is made clear that if the policy holder suppressed regarding pre-existing disease and the same is proved by the Insurance company the policy holder or his dependent is not entitled to cash less benefit, but in this case the OP company has not placed any documentary proof to show that the complainant’s husband was suffering from melegnant melenoma prior to sending up the proposal and no medical record is produced to establish that the complainant’s husband took treatment for the same prior to submission of proposal Form. It is contended by the complainant that her husband did not know about the disease which was diagonised in the year 2007 and therefore the burden is on the OP to establish that the complainant’s husband has deliberately and knowingly has suppressed the then the existing disease in the proposal form. In the discharge certificate “Death Summary” the history is mentioned as following: <br /> <br /> “ Known case of malignant pleural effusion and the patient had fever 20 days back associated with chills and rigor, moderate degree no diurnal variations for 5 days followed by cough with expectorant followed by breathlessness on exertion for above complaints” <br /> <br /> 19. If we peruse the above history no where it is mentioned that the patient was suffering from that disease since 2005. Therefore the latest certificate does not speak that the husband of the complainant had been suffering from melognant melenoma since 2005 and admittedly proposal form was sent on 28/6/2007. and the same was accepted and later policy was issued subsequently.<br /> <br /> 20. The duty is cast upon the Insurance company to examine the insured at the time of accepting the proposal or issuing the policy which the insurance company-OP has failed to do so. <br /> <br /> 21. The following citations would suggest that burden is on the insurer to establish that there is nexus between the disease and the cause of death and the burden is heavily on the insurer to establish that the insured had the knowledge of the disease and knowingly the insured has failed to disclose the same at the time of sending the proposal. <br /> <br /> “Life Insured died- claim repudiated on the ground of suppression of fact of illness- but there was no nexus between ailment and death” – Dvl.Manager, LIC of India Vs Jeetho Devi 1997(1) CPJ 310.<br /> <br /> “Claim was repudiated on the ground that the insured who died on heat attack suppressed the fact of his suffering from diabetes- the insurance company has failed to prove the nexus between heart attack and diabetes. Repudiation of claim amounts to deficiency in service” – Shantha Ben Ratilal Patel Vs LIC of India 1996(2) CPJ 92.<br /> <br /> “Insurance claim repudiated for concealment of fact of insured suffering from cancer. There was no evidence that the insured had the knowledge . Repudiation held was bad.” LIC of India Vs Sanjeev Mahendra Paul Sha 1998(1) CPJ 45-National Commission.<br /> <br /> “Claim repudiated for suppression of material fact no nexus of cause of death and ailment was proved. Repudiation was held to be arbitrarily” Dvl.Manager, LIC of India Vs T.Venkateshwaralu 1998(1) CPJ 568 AP.<br /> <br /> “The burden to prove of ailment lies on the company. No document was produced in support of contention that the deceased did not disclose that he was suffering from heart ailment. Insurance company failed to discharge his duty and held liable for deficient in service and liable to payment with interest” LIC of India Vs Smt.Asha Singh 2002(1) CPJ 403 UP, LIC of India Vs Charanjit Kour 2001(1) CPJ 53, LIC of India Vs Surjan Singh Saini 2001(1) CPJ 278.<br /> <br /> 22. Keeping the above citation in mind and the material placed before the Forum it can be said that the OP has failed to establish that the insured has deliberately and knowingly suppressed the fact of the disease with which he was suffering at the time of sending the proposal for obtaining the health insurance policy. <br /> <br /> 23. Since the OP has repudiated the genuine claim made by the complainant, has committed deficiency in service and therefore we answer point NO.1 positively.<br /> <br /> 24. No doubt the complainant has produced some medical bills at the time of filing the complainant there may be some inadmissible bills and the Forum cannot go in to those details and say as to how much the complainant is entitled for medical reimbursement. It is for the OP-Insurance company to examine the admissibility of those bills and take a final decision in the matter, having regard to terms and conditions of the policy the broucher issued in this regard, there is no doubt as such to admit the claim of the complainant, but only the quantum of medical reimbursement is to be determined by the OP-Company.<br /> <br /> 25. Having given the findings as above and the reasons there to we proceed to pass the following <br /> <br /> <br /> <br /> ORDER<br /> <br /> The complaint is partly allowed, and the OP is hereby directed to peruse the bills and consider the claim of the complainant positively taking in to consideration of the terms and conditions of the policy and further directed to pay interest at 10% p.a. from the date of the repudiation till its payment, after taking back the medical bills submitted by the complainant which are available in the Forum’s file. For complainant being put to mental agony and hardship and for financial loss, the OP is directed to pay the compensation of Rs.1000/- and Rs.1000/- towards the cost of the proceedings to the complainant.<br /> <br /> The OP shall comply the said order with in 60 days from the date of receipt of this order.<br /> <br /> Communicate this order to the parties.<br /> <br /> (Dictated to the Stenographer. Got it transcribed and corrected. Pronounced in the open Forum on this 07th day of July 2009).<br /> <br /> <br /> <br /> (M.R. DEVAPPA), (K.S. PRASAD), (A.S. HEMALATHA),<br /> PRESIDENT MEMBER MEMBER<br /> <br /> <br /> <br />