Before the District Consumer Dispute Redressal Commission [Central], 5th Floor ISBT Building, Kashmere Gate, Delhi
Complaint Case No.181/12.05.2016
C1. Sh. Aditya Rathi son of Sh. Rajiv Rathi
C2. Smt. Priya Rathi wife of Sh. Aditya Rathi
Both resident 25, Sadhna Enclave, New Delhi-17 …Complainants
Versus
OP1. M/s Cholamandlam MS General Insurance Co. Limited,
through its Director/Principal Officer Plot No. 6,
Ist Floor, near Metro Pillar No. 81, Main-6, Pusa Road,
New Delhi-5.
OP2. M/s Cholamandlam MS General Insurance Co. Limited,
through its Director/Principal Officer Hari Niwas Towers,
2nd floor, 163, Thambu Chetty Street, Parry's Corner,
Chennai-600001 Tamil Nadu. …Opposite Party
Order Reserved on: 22.02.2023
Date of Order: 09.05.2023
Coram: Shri Inder Jeet Singh, President
Shri Vyas Muni Rai, Member
Ms. Shahina, Member -Female
Inder Jeet Singh
ORDER
1.1. (Introduction to case of parties and relief claimed) : Complainants and others in his family are insured and OPs are insurer. The complainant no.2 was discovered with Polycystic Ovaries Disorder (PCOD), she was treated and there were surgery, however, when two claims were lodged, the same were refused by the OPs by repudiating the claim by letters dated 08.04.2015 and 06.06.2015, on the ground, that there were concealment of facts of pre-existing disease and also exclusion clause, which complainant alleged that it is unfair trade practice and there is deficiency of services on the part of OPs that in order to deny the legitimate claim, false plea was taken by them as complainant no.2 was not suffering from any pre-existing disease nor there was any occasion to conceal it.
The complainants seeks directions to (a) hold that the services rendered by the OPs are deficient, (b) hold that the OPs indulged in unfair trade practice, (c) hold that on account of in unfair trade practice adopted by the OPs, the complainants have suffered loss and damage and have illegally and mala-fide arbitrarily withheld the amount legally due to the complainants (d) direct the OPs to pay to the complainants a sum of Rs.3,66,935/- along with interest @ 24% per annum from the date the amount is due to the actual date when the amount is paid to the complainants (e) direct the OPs to pay Rs.50,000/- as damages to complainants for undergoing mental pain and agony & harassment and (f) direct the OPs to pay Rs. 31,000/- towards litigation expenses and costs.
1.2: The OPs deny that the complainant no. 2 was suffering from disease, which was concealed by the complainant and the pre-existing of disease was unfolded during investigation from the record provided by the complainant themselves. The claim was not legitimate. The repudiation letters were issued properly, in fact, the contract of insurance was void ab-initio because of concealment of the fact of pre-existing disease by the complainant. They requests to dismiss the complaint.
2.1 (Case of complainant): It was 25.01.2012 when the complainant no.1 Sh. Aditya Rathi took a Policy bearing No. 2866/00100271/000/03 from OPs for himself, his wife Smt. Priya Rathi and his father Sh. Rajiv Rathi, which was also got renewed from time to time after the OPs receiving yearly premium from the complainants without interruption. The complainant no.1 has not concealed any information at the time of taking the policy. The Insurance Policy was issued by the OPs after fully satisfying themselves.
2.2. The Complainant no. 2 (Smt. Priya Rathi) was admitted to M/S Sita Ram Bhartia Institute of Science & Research B-16, Qutub Institutional Area, New Delhi-16 as she had complained of having irregular periods, since the birth of her child on 21.06.2012. After the ultra sound was done in August, 2013, an ovarian mass was noted. Thereafter MRI was done in 2013 & 2014, it was showing an increase in the size of
cysts and increase size of polypoidal growth within it. Laparotomy was conducted, on 27.02.2015 was diagnosed with bilateral ovarian cysts with papillary projections. After Laparotomy with bilateral ovarian cystectomy and omental biopsy was conducted on her under general anesthesia wherein it was discovered that though, the uterus was of normal size but a hard mural node was noted
on both the ovaries. On findings of biopsy, it was discovered that it was a case of borderline malignancy. In the process, complainant no.2 had incurred medical expenses of
Rs.1,55,132/-. She requested OPs to reimburse the claim, which was supported by all documents. However, OPs vide its letter dated 08.04.2015 rejected her claim on the frivolous pretext that signs and symptoms of the present ailment were existing since 2011, prior to taking the policy and as such the claim was inadmissible as per general exclusion clause C-1 and further the said information was not disclosed in the proposal form while proposing the insurance. However, it was an arbitrary and illegal act on the part of the OPs to presume as pre-existing disease. The OPs presumed signs and
symptoms of the present ailment were existing since 2011 by overlooking that the complainant no. 2 had delivered a child on 21.06.2012. There is nothing on record that
she was suffering from Polycystic Ovaries Disorder (PCOD) for last ten years.
2.3 The complainant was again admitted to Sita Ram Bhartia Institute of Science & Research, B-16,Qutub Institutional Area, New Delhi, where she was diagnosed with borderline serious tumor with focal micro-papillary pattern and total abdominal hysterectomy with bilateral salpingooophorectomy with complete omentectomy with peritoneal biopsy was done under general anesthesia on 13.04.2015. On 15.04.2015 the ovaries and the uterus of
complainant no.2 was removed as a preventive measure of developing cancer after appropriate sincere advice of doctors. On this occasion bill of Rs. 2,10,803/- was raised by Sita Ram Bhartia
Institute of Science & Research. The complainants again approached the OPs with all documents
and requested them to reimburse the claim but the claim was again declined by OPs by its letter dated 06.06.2015 on the same line of earlier rejection letter dated 08.04.2015. Both the letters dated 08.04.2015 and 06.06.2015 issued by OPs are wrong, mala-fide, null, void, arbitrary and calculated to deny legitimate and valid claim, which is
against all canons of justice and liable to be set aside since taking this vexatious and frivolous plea not only the claim of the
complainants was rejected but also the contract of insurance was declared void.
2.4. Whereas, there was no concealment of any fact by the
complainants at the time of taking the policy. The operations/medical treatment conducted by the doctors on complainant no.2 has no concern with
PCOD or syndrome conducted on her in the year 2011. Neither
the signs nor the symptoms of the ailment for which complainant no.2 was
operated upon existing since 2011 nor the same were ever diagnosed. There is no
reason that the present ailment can be considered as pre-existing disease. Further PCOD is neither an ailment nor a disease. A frivolous
and a baseless ground is created by the officials of the respondent with the sole motive
to decline the benefit of the Policy to the complainants. Otherwise, also the said clause
of the Policy is void and is liable to be struck down as the complainants has duly paid
the amount/premium for the medical treatment of complainant no. 2 for the period.
Without prejudice to the rights of the complainants and without admitting it, pre-existing diseases and exclusions clauses given in the policy schedule are not applicable after 48 months of continuous cover with OPs. The ground of rejection mentioned in rejection letters dated 08.04.2015 and dated 06.06.2015 are not in consonance with the policy schedule. There is deficiency in service on the part of OPs in rejecting the legitimate claims of the
complainants and they are vicariously liable to pay the amount of Rs.3,66,935/- to the complainants along with interest. The OPs were served with legal notice dated 28/10/2015 to
reimburse the amount of Rs.3,66,935/along with interest @, 24% per annum, which was not complied by OPs but they sent a false reply dated 30.11.2015 to the notice.
2.5. The complaint is supplemented with record of insurance policies, photocopy of cheque of premium paid, medical papers inclusive of discharge summary dated 02.03.2015, medical bills, claim form, letter issued by Dr. (Prof.) Uma Sarin, repudiation letter dated 08.04.2015, other medical papers in respect of second episode, bills, discharge summary dated 17.04.2015, repudiation letter dated 06.06.2015, legal notice dated 28.10.2015 and its reply dated 30.11.2015 by OPs.
3.1 (Case of OPs) : The OPs do not deny that the Complainant no.1 entered into a contract with the OPs by virtue of Health Insurance Policy namely Individual Health Policy, on confirmation through Proposal Form, for himself, his spouse, his father and child; the OPs issued a policy no. 2866/00100271/000/03 valid for the period from 25.01.2015 to 24.01.2016 subject to the terms and conditions as provided with the policy, which was in continuation since 25.01.2012.
3.2 However, when complainant no.1 raised claims regarding admission of his wife/complainant no.2 for the period from 27.02.2015 to 2.03.2015 for "bilateral ovarian cyst for surgical management" in Sitaram Bharatia Institute of Science & Research, the OPs had registered the claim No. 2866000025 and also appointed surveyor to investigate and verify the treatment. Moreover, the complainant was asked by letter dated 19.05.2015 to provide 'all previous consultation papers and investigation reports related to the complaints of irregular periods', which were provided too. During verification by the investigator , the OPs came to know that the complainant no.2 was suffering from the disease since August 2011 , which is before the inception of the policy, but pre-existing disease was not covered under the policy vis a vis the complainant had not disclosed of pre-existing disease of complainant no.2 in the proposal form, for which the claim was raised. The declaration given in proposal form by the 'complainant 'was false declaration, consequently the contract of insurance stands rendered null and void-ab-initio as the contract of insurance is based on utmost-good faith and the information provided by the complainant in the proposal form was false, and suppression of material facts and information. The Hon'ble Supreme Court in catena of landmark judgments held that if there is suppression of material information at the time of submitting proposal form for Health Insurance, the proposer is under obligation to disclose all the material information regarding pre-existing disease, and if there is concealment then the entire contract of insurance is null and void. The claim of the complainant was considered on merits and it was found unfit for payment due to concealment of material facts of pre-existing disease as the Dr. (Prof.) Uma Sarin gave in writing on her letter head that complainant no.2 was under her treatment since 2011, which is prior to inception of policy and she was diagnosed of Polycystic Ovaries and further symptoms of PCOD.
3.3. The OPs deny all other allegations of complaint deficiency of services or of unfair trade practice or rejection of claims was arbitrary, mala-fide or calculated by the repudiation letters dated 8.04.2015 and 6.06.2015 or complainants' claim was valid or legitimate with conclusion to dismiss the complaint.
4. (Replication of complainant) : The complainants filed their detailed replication, it denies the stand of OPs taken in the written statement and replication reaffirms the complaint as correct. The OP had also taken an objection on the point of territorial jurisdiction, it was also responded that the Branch Office of OPs is in the territorial jurisdiction of this Commission.
5.1 (Evidence) : Complainant no. 1 and complainant no. 2 filed their respective affidavit of evidence duly supplemented with the documentary record filed with the complaint.
5.2: On the other side, OPs filed affidavit of Sh. Jitendra Dhabhai, Legal Manager and this affidavit of evidence is on the pattern of reply, coupled with documentary record of insurance policy, letter dated 19.03.2015, record of previous treatment, radiologist report, prescriptions and letter by Dr. (Prof.) Uma Sarin, discharge summary, investigation report, repudiation letters dated 08.04.2015 and 06.06.2015.
6.1 (Final hearing) : Both the parties have filed their written arguments; complainants had also filed case law with the written arguments.
6.2: The parties were given opportunity to make oral submissions. However, no submissions were made on behalf of OPs but complainant no. 1 appeared, he was asked that arguments may be by their counsel, but he insisted that the written arguments may be considered. Accordingly, the record will be considered.
7.1 (Findings) : The case of both the sides are considered analytically, keeping in view the pleadings and documentary record. There are two instances, when complainant no.2 had undergone treatment from 27.02.2015 to 02.03.2015 as indoor patient, however, her claim for reimbursement was denied by repudiation letter 08.04.2015, which also declares that there was concealment of pre-existing ailment/disease and for want of its disclosure being material information, the contract of insurance became void and no claim is payable. The second episode of treatment as indoor patient was from 12.04.2015 to 17.04.2015 and the claim was repudiated vide letter dated 06.06.2015 on same very grounds. Whereas the complainants case is that complainant no. 2 was not suffering from PCOD and there was no occasion for the complainant no. 1 to disclose so in the proposal form. 7.2: Therefore, in order to determine the controversy, it is appropriate to reproduce the relevant terms and conditions of policy, as it would make convenient to compare with the facts of the case. The following is extract from the terms and conditions of policy-
IV Definition
Clause no 46. of Pre-Existing Diseases: Any condition, ailment or injury or related conditions for which the insured had signs or symptoms and/or were diagnosed and/or received medical advice/ treatment, within 48 months prior to inception of his / her first policy issued by the insurer.
Clause no 50 Proposal Form: The form in which the details of the insured person are obtained for a Health Insurance Policy. This also includes information obtained over phone or on the internet and stored on any electronic media and forms basis of issuance of the policy
Exclusions - Pre-Existing Disease (PED)
Benefits will not be available for any pre-existing condition(s) as defined in the policy, until 48 consecutive months of continuous coverage has elapsed, since inception of the first policy with Us/with any other Indian Insurer.
7.3. By comparing the rival stand of the parties, the sole question is whether or not complainant no. 2 was suffering from any disease prior to taking the policy? In order to appreciate the rival stand, the following conclusions are drawn:-
(i). The OPs had asked the complainants about previous treatment record; the complainants had furnished a letter dated 10.08.2011,(which has been filed by the complainants in their evidence as well as by OPs in their evidence ). The relevant portion of this letter reads as “an anechoic cyst with hyper-echoic nodular thickening of the wall inferiorly and a good peripheral vascularity is present in the right ovary? Corpus luteum? Nature. It measures approx 23.6x 19.8x21.9 mm and 5.4 cm3 vol.” “Inference: Appearances are suggestive of bilateral polycystic ovaries, with a right ovarian cyst? C.L? nature. Ca 125 is suggested.”
(ii). Dr. (Prof.) Uma Sarin had also furnished certificate under the title to whom it may concern, she has narrated not only about symptoms and PCOD in her letter but also that there was delivery by caesarian at Jaipur in 2012, apart from appropriate advices.
(iii). In discharge summary dated 2.3.2015, there is brief past history record as “known case of polycystic ovarian disease, on tab. Bigomet SR (500mg) 1 tab twice daily”
(iv). After second episode of 12.04.2015-17.04.2015 another discharge summary dated 17.04.2015 was issued, it is also by the same hospital of Sitaram Bhartiya, Institute of Science and Research, which also gives in brief past history record as “ Open ovarian cystectomy in February 2015.”
(v). The OPs issued repudiation letter dated 08.04.2015, while referring the insurance policy clause as well as the record gather during investigation by the investigator and in the other repudiation letter dated 06.06.2015, the same instances has been reiterated by the OPs.
(vi) The insurance policy is a contract between the parties, both the parties are bound by its terms and conditions. The first insurance policy was taken on 25.01.2012 and as per the record made available to the OPs during lodging of first claim for reimbursement of amount, one of the record is of letter dated 10.08.2011, which talks about an anechoic cyst with hyperechoic nodular thickening of the wall inferiorly and a good peripheral vascularity is present in the right ovary, with “Inference: Appearances are suggestive of bilateral polycystic ovaries, with a right ovarian cyst?, which were existing prior to taking the insurance policy in 2012. The complainants' that it was known only at the time of birth of child on 21.06.2012 is not a convincing and acceptable plea. There is pre-existing disease treated for, that is why it was mentioned as past history too in the discharge summary. The situation is governed by the definition of PED as well as the exclusion clause which are already reproduced in para no. 7.2 above. The complainants have relied on New Indian Insurance Co. Ltd. Vs Rajeev Agarwal and Ors. (RP No. 2350/2012 dod 29.06.2015 by Hon’ble National Commission) that the proposal form was not put to the record to make out suppression of pre-existing disease, however, the feature of that case are distinguishable from the situation in hand as the case of complainants is that complainant no. 2 was not suffered from any disease or there was no occasion for them to disclose in the proposal form but on the other side case of OPs is that the record furnished by the complainants are establishing pre-existing disease.
(vii) The complainants have also relied upon Madhu Jain vs National Insurance Co. Ltd. (Appeal no. 1356/2002 dod 08.01.2008 by Hon’ble State Commission) that term disease was interpreted and the case of complainants are not covered, however, this will also not at the assistance of complainants as clause pre-existing disease has also been defined in the insurance contract between the complainant no. 1 and OPs, the definition of pre-existing disease has already been reproduced in para no. 7.2 above, the case is to be seen from this point of view.
7.4: The conclusion drawn in sub paragraph 7.3 above, clearly establish that the complainant no. 2 was suffering from disease in 2011, she had also consultancy and treatment for that disease, it was not disclosed by complainant no. 1 while taking the first policy in the year 2012, however, it unfolded to the knowledge of OPs during assessment of first claim of complainants. Therefore, the OPs have repudiated both the claims by invoking terms and conditions of the policy. It would not give any benefit to complainants that there is lapse of period 48 months, since the exclusion clause oust the claim when there is non-disclosure of pre-existing diseased.
Thus it is held that complainants could not establish their case against OPs on any count. The OPs have succeeded to establish their stand.
7.5: Accordingly, complaint fails. The complaint is dismissed. However, no order as to cost.
8. Copy of this Order be sent/provided forthwith to the parties free of cost as per rules for necessary compliance.
9: Announced on this 09th May, 2023 [वैशाख 19, साका 1945].
[Vyas Muni Rai] [ Shahina] [Inder Jeet Singh]
Member Member (Female) President
