MRS. M. SHREESHA, MEMBER

Challenge in this Revision Petition under Section 21 (b) of the Consumer Protection Act, 1986 (in short “the Act”) is to the order dated 01.11.2017 passed by the  Punjab State Consumer Disputes Redressal Commission (in short “the State Commission”) in First Appeal  No. 363 of 2017. By the impugned order, the State Commission has concurred with the finding of the District Consumer Disputes Redressal Forum, Moga  (in short “the District Forum”), and dismissed the Appeal preferred by M/s. Star Health and Allied Insurance Co. Ltd. (hereinafter referred to as “the Insurance Company”).

2.       The facts in brief are that the Complainant had taken an Insurance Policy covering  four persons of family, namely, the Complainant, his wife Renu Dang and his daughters Payal Arora and Ekta Arora for the period 27.09.2011 to 26.09.2012, paying a premium of ₹12,232/-. It is averred that the Complainant had renewed the Policy from the Insurance Company covering three persons himself, his wife and Ekta Arora his daughter for a period 27.09.2012 to 26.09.2013 and paid a premium of ₹14,416/-. It is stated that the name of his daughter, Payal Arora was excluded as she got married during that current year. Thereafter the Policy was once again renewed for the period 27.09.2013 to 26.09.2014 and subsequently from 27.09.2014 to 26.09.2015 and further from 27.09.2015 to 26.09.2016. The coverage was to a limit of ₹3,75,000/- with recharge benefit of ₹75,000/- and the Complainant has admittedly paid a premium of ₹15,698/-. It is pleaded that the Complainant had disclosed all the facts to the third Opposite Party, while taking the first Policy in the year 2011 that his wife Renu Dang had been operated at Max Super Speciality Hospital, Mohali in the year 2007 for PTCA stenting on 30.07.2017. The third Opposite Party had replied that every disease was covered after the 48 months period, whether the same was pre-existing or not and hence the same was not mentioned in the Proposal Form nor was any Proposal Form supplied to him.

3.       While so, the Complainant’s wife felt a severe pain on 29.09.2015 and was admitted at Global Heart Super Speciality Hospital for angiography. Later she was admitted at Max Super Speciality Hospital, Mohali  on 05.10.2015 where PTCA with DES to LAD was performed and she was discharged on 06.10.2015  and an amount of ₹4,00,000/- was spent on the treatment. The Complainant had a cashless Policy but the Insurance Company refused to make the payment to Max Super Speciality Hospital though the Complainant had supplied all the documents. Hence the Complainant approached the District Forum seeking a direction to the Insurance Company to pay ₹4,00,000/- with interest @ 18% p.a., compensation of ₹5,00,000/- and other costs.

4.       All the Opposite Parties filed a joint Written Version stating that the parties are bound by the terms and conditions of the Policy and that the Complainant had taken the Policy by suppressing the material fact of pre-existing ailment of his wife, who underwent PTCA stenting LAD on 30.07.2007 prior to the inception of the Policy. Preliminary objections were raised that preamble of the Policy clearly states that proposal, declaration and other documents, if any given by the proposer form the basis of the Policy of insurance "Subject to terms, conditions, exclusions and definitions contained herein or endorsed or otherwise expressed herein, the Company undertakes, if the insured person shall contract any disease or suffer from any illness or sustain any bodily injury through accident and if such disease or injury shall require the insured persons, upon the advice of the duly qualified physician/medical/specialist/medical practitioner or duly qualified surgeon to incur hospitalization expenses for medical/surgical treatment at any nursing home/hospital in India as herein defined as an inpatient the Company will pay to the insured person the amount of such expenses as are reasonable and necessarily incurred in respect by or on behalf of the insured person up to the limits indicated. It was averred that the contract was voidable as the Complainant had suppressed the material facts and hence their repudiation was justified.

5.       The District Forum based on the evidence adduced allowed the Complaint on a  non-standard basis and directed the Opposite Parties to pay ₹2,75,075/- i.e. 75% of ₹3,66,766/- as claimed by the Complainant together with interest @ 9% p.a. from 07.01.2016 till the date of realisation and costs of ₹3,000/-.

6.       Aggrieved by the said order, the Insurance Company preferred an Appeal before the State Commission. The State Commission while dismissing the Appeal observed as follows:

“6.  We have examined the evidence on the record led by the parties in this case.  Complainant tendered his affidavit Ex.C-1 in support of his pleaded case.  He specifically stated this fact on oath that regarding earlier ailment of his wife, the fact was disclosed to OP No.3 and he stated that policy would come into operation after 48 months from the date of inception for the diseases, irrespective of this fact whether diseases were pre-existing or not.  Ex.C-3 is the customer's identity card issued by OPs to Renu Dang wife of complainant on the record.  Ex.C-27 is the Family Health Optima Insurance Plan and clause 1 of its conditions stipulates that the insurance company shall not be liable to make any payment under this policy in respect of any expenses whatsoever incurred by the insured person in connection with, "Pre-existing diseases, as defined in the policy until 48 consecutive months of continuance coverage have elapsed; since inception of the first policy with any Indian insurer.  However the limit of Company's liability in respect of claim of pre-existing diseases shall be limited to the sum insured under the first policy with any Indian Insurance Company".

7.  The first policy was taken by the complainant in the year 2011 and subsequent policies are in continuation thereof, by means of renewals only against fresh premium.  The period of 48 months has already expired in this case even for pre-existing diseases, as per above-referred condition.  Conditions No.3 to 9 of Ex.C-27 are not attracted at all to the above-referred pre-existing disease of CAD of Renu Dang in this case.  The OPs have been receiving the premiums from complainant constantly of the policies.  Even the period of 48 months have to commence from the first policy taken by complainant in the year 2011, which is Ex.C-31 on the record.  The contention of appellant pales into insignificance on this point that the contract is rendered voidable for suppression of pre-existing disease in view of above specific clause of insurance policy, as referred to above.”

7.       Learned counsel appearing for the Insurance Company vehemently contended that both the fora below have erred in not considering the terms of the Policy in its truest sense. The State Commission has wrongly held that since 48 months have already expired even if the illness is a pre-existing disease, it is covered and therefore conditions 3 to 9 are not attracted. He argued that this was a case of deliberate concealment of material facts and the contract became void for that reason. He also relied on the decision of the Hon’ble Supreme Court in Life Insurance Corporation of India Vs. Asha Goel, 2001 (2) SCC 160, where the Hon’ble Apex Court, referring to theobservation in Looker Vs. Law Union and Rock Insurance Co. (1928) 1  554 has held as follow:

“The well settled law in the field of insurance is that contracts of insurance including the contracts of life assurance are contracts uberrima fides and every fact of materiality must be disclosed otherwise there is good ground for rescission. And this duty to disclose continues up to the conclusion of the contract and covers any material alteration in the character of the risk which may take place between proposal and acceptance.”

8.       Learned counsel appearing for the Respondents submitted that PTCA stenting to LAD was done on 30.07.2007, which is more than four years prior to the taking of Policy on 27.09.2011, moreover, the same was disclosed to the third Opposite Party that his wife has undergone stenting on 30.07.2007. The third Opposite Party being an agent of the Insurance Company assured the Complainant that the pre-existing disease was not applicable in the present case as the same was beyond the period of 48 months.

9.       It is not in dispute that the same Policy was renewed every year subsequently for a period of five years. The Family Health Optima Insurance Plan deals with pre-existing disease as follows:

“Pre-Existing Disease means any Condition, ailment or injury or related condition(s) for which the insured person had signs or symptoms, and/ or were diagnosed, and/or received medical advice/treatment within 48 months prior to the insured person’s first policy with any Indian insurer”

          In clause 3.0, Exclusions it is stated as hereunder:

“Pre Existing Diseases as defined in the policy until 48 consecutive months of continuous coverage have elapsed; since inception of the first policy with any Indian Insurer. However, the limit of the Company’s liability in respect of claim for pre-existing diseases shall be limited to the sum insured under the first policy with any Indian Insurance Company.”

10.     It is evident from the above Clauses that only those diseases which are existing within 48 months prior to the insured person’s first Policy would be excluded from the coverage period. In the instant case even assuming for the sake of argument that the Complainant did not declare that his wife has undergone PTCA stenting on 30.07.2007, admittedly  the first Policy was taken on 27.09.2011, which is four years prior to the subject Policy. The medical record also shows that the Complainant’s wife Smt. Renu Dang, who is also an insured, was admitted for angiography only on 05.10.2015 and was discharged after one night of hospitalisation on 06.10.2015. Therefore the question of pre-existing disease as defined in the Clauses of the Policy does not apply to the insured as the period of 48 months has lapsed both prior to the taking of the first Policy and even after the subsequent renewals.

11.     It is also relevant to mention that under condition 4.0 for cashless treatment under point g it is stated that ‘the company will process the request and call for additional documents/ clarifications if the information furnished is inadequate.’

12.     Having held that the repudiation of the claim was unjustified, the contention of the Complainant that though the plan covered cashless treatment, he was denied the facility, is addressed to. The letter dated 05.10.2015 denying the cashless treatment states that the ground for denial was because of ‘no sufficient documents’. On a pointed query from the Bench on 23.04.2018, learned counsel appearing for the Insurance Company was requested to seek instructions as to what further information/ document was demanded from the Hospital, on the Hospital’s furnishing information about the admission of the insured in the prescribed form on 05.10.2015, which has marked as an Exhibit before the fora below. No such information was placed on record. In the absence of any material on record to establish that the ground taken by the Insurance Company  denying the cashless treatment for the reason ‘document not sufficient’, I am of the opinion that such an act of the Insurance Company amounts to ‘unfair trade practice’ and is totally deprecated. I do not see any grounds to interfere with the well considered order of both the fora below and hence this Revision petition is dismissed with cost of the ₹10,000/- to be paid to the Complainant. Needless, to add any amounts deposited with the State Commission shall stands adjusted from the decretal amount.