Punjab

Ludhiana

CC/20/338

Dharminder Singh - Complainant(s)

Versus

ICICI Lombard General Insurance Co.Ltd - Opp.Party(s)

A.B.Sharma Adv.

17 Oct 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:338 dated 09.12.2020.                                                         Date of decision: 17.10.2023.

 

Dharminder Singh S/o. Sunder Lal, R/o. H. No.113, Ward No.9, Dehlon Road, Ganpati Colony, Sahnewal, Ludhiana.                                                                                                                                             ..…Complainant

                                                Versus

ICICI Lombard General Insurance Company Ltd., TF 1-5, 3^rd Floor, 88 Kunal Tower, The Mall Road, Ludhiana through its Branch Manager.                                                                                                                  …..Opposite party 

Complaint Under section 35 of the Consumer Protection Act.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

SH. JASWINDER SINGH, MEMBER

MS. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant             :         Sh. B.K. Soni, Advocate.

For OP                           :         Sh. Rajeev Abhi, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                Briefly stated, the facts of the case are that purchased medical insurance policy bearing No.4128i/iH/182921074/00/000from the opposite parties having validity from 15.10.2019 to 14.10.2020 for himself and his family members having coverage of Rs.5,00,000/- by paying premium of Rs.17,627/-. The complainant stated that on 19.11.2019, he admitted in SPS Hospital, Ludhiana for his treatment due to chest pain for last one day and was suggested for the replacement of aortic valve. The complainant was discharged on 21.11.2019 and he spent Rs.25,000/- on his treatment. On 25.11.2019, the complainant was again admitted and was discharged on 30.11.2019 and during this period he spent Rs.2,76,740/- on his treatment. The complainant submitted pre-authorization request/claim No.110100413946 on 19.11.2019 but the same was declined by the opposite party on the ground that the complainant had history of post traumatic seizures 15 years back. Even the same was priorly disclosed to the opposite party who themselves had not mentioned the said fact by saying that the same was more than 15 years old and had no significance for obtaining the present insurance. According to the complainant those are very minor seizures which has no significance with regard to present ailment. Rather the opposite party has wrongly denied his claim and has further proposed to terminate the insurance policy vide letter dated 27.02.2020. The opposite party has denied the claim without any proper reason which amounts to deficiency in service and malpractice on the part of the opposite party and as such, he is entitled to compensation of Rs.50,000/- due to sufferance of mental pan and harassment at the hands of opposite party. In the end, the complainant has prayed to issue direction to the opposite party to pay the amount of Rs.3,01,740/- spent on his treatment along with compensation of Rs.50,000/- and litigation expenses of Rs.25,000/-.

2.                Upon notice, the opposite party appeared and filed written statement and by taking preliminary objections, assailed the complaint on the ground of maintainability of the complaint; lack of jurisdiction; concealment of facts; the complainant estopped by his own act and conduct etc. Opposite party stated that immediately on the receipt of the claim it was duly registered and entertained. The complainant has obtained the Health Insurance Policy bearing No.4128i/iH/182921074/00/000 valid from 15.10.2019 to 14.10.2020 for the sum assured Rs.5,00,000/-. According to the opposite party, the insurance policy is contract in itself and the parties are bound by the terms and conditions of the policy. Nothing can be added or subtracted out of it as per the law laid down by the Apex Court. It is one of the condition in the policy i.e part III of schedule clause I of the policy T&C in contestability and duty of disclosure

"The policy shall be null and void and no benefit shall be payable in the event of untrue or incorrect statements, misrepresentation, mis-description or non-disclosure in any material particulars in the proposal form, personal statement, declaration and connected documents or any material information having been withheld or a claim being fraudulent or any fraudulent means or devices being used by you or anyone acting on your behalf to obtain any benefit under this policy."

Further as per policy conditions the wording that "Cancellation/termination - (i) Disclosure of information norm - The policy shall be void and all premium paid hereon shall be forfeited to the company, in the event of misrepresentation, mis-description or non-disclosure of any material fact. (ii) You may cancel this policy by giving us 15 days written notice for the cancellation of the policy by registered post and then we shall refund premium on short term rates for the unexpired policy period as per the rates detailed below, provided no claim has been payable on your behalf under the policy……."

                   The opposite party further stated that the complainant has lodged the claim/pre-authorization request for the medical expenses incurred on his treatment with SPS Hospital with date of admission as 19.11.2019 to 21.11.2019 and from 25.11.2019 to 30.11.2019 with diagnosis of severe calcified aortic stenosis and aortic annulus 2:1 cm. The said claim was registered at No.110100413946. Immediately after the receipt of the claim and the documents pertaining to the claim it was duly scrutinized and investigated by the officials of the opposite party. During processing of the claim as per SPS Hospital reference sheet dated 24.11.2019 insured Dharminder Singh had history of post- traumatic seizures 15 years back. The same was not disclosed during the policy inception i.e. on 15.10.2019 bearing proposal form No.10013825565. After scrutinizing all the documents placed in the claim file and after due application of mind by the officials of the opposite party in terms of the insurance policy the claim of the complainant was repudiated as no claim vide repudiation letter dated 19.2.2020 on the ground of non-disclosure since as per the documents furnished "Patient is k/c/o (POST TRAUMATIC SEIZURES, history of seizures 15 years back following head trauma and was on medication)... as per part III of schedule, clause I of policy T&C., Incontestability and Duty of Disclosure: The Policy shall be null and void and no benefit shall be payable in the event of untrue or incorrect statements, misrepresentation, mis-description or on non-disclosure in any material particular in the proposal form, personal statement, declaration and connected documents, or any material information having been withheld, or devices being used by You or any one acting on Your behalf to obtain any benefit under this Policy." According to the opposite party the claim of the complainant has rightly been repudiated as no claim and the grounds of repudiation are legal, valid and enforceable and are in accordance with the terms and conditions of the policy. Moreover, the complainant was also served with the termination notice dated 27.02.2020 of 15 days in respect of health policy No.4128i/iH/182921074/00/000 in terms of the insurance policy obtained by the complainant clearly stating that as per clause 1 of part III of the policy wording "The policy shall stand cancelled after 15 days from the date of letter dated 27.02.2020 and the premium shall be refunded". The policy in question as such was cancelled and the proportionate premium out of the total premium was refunded to the complainant as per terms and conditions of the policy. After the cancellation of the policy, the complainant is no more a consumer and the  opposite party is no more a service provider under the aforesaid policy.                              On merits, the opposite party reiterated the crux of averments made in the preliminary objections and facts of the case. The opposite party has denied that there is any deficiency of service and has also prayed for dismissal of the complaint.

3.                In support of his claim, the complainant tendered his affidavit Ex. CA in which he reiterated the allegations and the claim of compensation as stated in the complaint. The complainant also tendered documents Ex. C1 is the copy of risk assumption letter, Ex. C2 is the copy of termination notice of policy dated 27.02.2020, Ex. C3 is the copy of discharge summary, Ex. C4 is the copy of inpatient bill dated 30.11.2019, Ex. C5 is the copy of inpatient bill dated 21.11.2019, Ex. C6 is the copy of bill of medicine etc. Ex. C7 is the copy of Aadhar card of the complainant and closed the evidence.

4.                On the other hand, counsel for the opposite parties tendered affidavit Ex. RA of Sh. Nishant Gera, Manager Legal of the opposite party along with documents Ex. R1, Ex. R28 is the copy of claim form, Ex. R2, Ex. R29, Ex. R42 are the copies of overview health claim form-hospitalization, Ex. R3 is the copy of policy certificate, Ex. R4 is the copy of discharge summary, Ex. R5, Ex. R6, Ex. R14, Ex. R15, Ex. R33 is the copy of cardiology report, Ex. R7, Ex. R8, Ex. R12, Ex. R13, Ex. R34, Ex. R35 to Ex. R38 are the copies of biochemistry report, Ex. R9, Ex. R11 is the copy of microbiology report, Ex R10, Ex. R30 to Ex. R32 are the copies of reports of X-ray chest, Ex. R16 is the copy of transfusion medicine report, Ex. R17 is the copy of ECG report, Ex. R18 is the copy of repudiation letter dated 19.02.2020, Ex. R19 is the copy for risk assumption letter, Ex. R20, Ex. R21 is the copy of policy certificate, Ex. R21 is the copy of tax certificate, Ex. R22, Ex. R23, Ex. R27 are the copies of health insurance I cards of the insured, Ex. R24 is the copy of key information sheet, Ex. R25 is the copy of policy wording, Ex. R39 is the copy of  operation record, Ex. R40 is the copy of medical summary of hospitalization, Ex. R41 is the copy of letter dated 29.06.2021 for denial of cashless access and closed the evidence.

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written reply along with affidavit and documents produced on record by both the parties. We have also gone through written arguments submitted by the complainant.

6.                Admittedly, vide Ex. C2= Ex. R3, the complainant purchased online ICICI Lombard Health Insurance Policy from the opposite party for himself and his family members w.e.f. 15.10.2019 to 14.10.2020. The complainant was admitted at SPS Hospital, Ludhiana on 19.11.2019 with complaint of chest pain since 1 day where he was diagnosed for severe Calcified Aortic Stenosis and Aortic Annulus 2.1 CM as mentioned in discharge summary Ex. C3 = Ex. R4 and was discharge on 21.11.2019. The complainant stated to have further admitted in the said hospital from 25.11.2019 to 30.11.2019 with same ailments. The complainant stated to have incurred Rs.3,01,740/- on his treatment for both periods. He submitted hospitalization claim form Ex. R2 along with documents. However, the opposite party rejected the claim of the complainant vide letter dated 19.02.2020 Ex. R18, the operative part of the same is reproduced as under:-

Sr. No.	Reason	Description
1.	Incontestability and Duty of Disclosure	Claim is rejected under non disclosure of as per the documents furnished patient is k/c/o (Post Traumatic Seizures, history of seizure 15 years back following head trauma and was on medication)… as per as per part III of schedule, clause I of policy T&C., Incontestability and Duty of Disclosure: The Policy shall be null and void and no benefit shall be payable in the event of untrue or incorrect statements, misrepresentation, mis-description or on non-disclosure in any material particular in the proposal form, personal statement, declaration and connected documents, or any material information having been withheld, or devices being used by You or any one acting on Your behalf to obtain any benefit under this Policy.

 

Subsequently, a letter for termination notice of policy dated 27.02.2020 Ex. C2 was issued to the complainant, the operative part of the same is reproduced as under:-

“We would like to bring to your notice that at the time of filling the proposal form No.10013825565, you have not declared or disclosed the below mentioned material fats and have acted in breach of the terms and conditions as provided in the proposal form and the policy.

During the processing of Pre Authorization Request/Claim No.110100413946 for admission at Satguru Partap Singh Hospital (N2099/CORE/1) on 11.10.2019, As per SPS Hospital reference sheet dated 24-Nov-2019, insured Dharminder Singh has history of post traumatic seizures 15 years back. The same was not disclosed during the policy inception i.e. 15-Oct-2019

In view of the same, we hereby give you a notice of 15 days for termination of contract of the insurance pursuant to clause 1 of the part III of the policy wordings.

The policy shall stand cancelled after 15 days from the date of this letter and the premium shall be refunded to you in full.”

 So by invoking part III of schedule 1 of the policy terms and condition, Incontestability and Duty of Disclosure, the opposite party denied the claim of the complainant vide letter dated 29.06.2021 Ex. R41 on account of non-disclosure of pre-ailment.

7.                Now the question arise whether the rejection/cancellation of the policy on the ground mentioned therein is valid or not? The rejection of the claim of the complainant was effected by the opposite party and was proposed to be cancelled by the opposite party by invoking part III of schedule 1 of the policy terms and condition, Incontestability and Duty of Disclosure that the complainant had not disclosed about the pre-existing disease of Post Traumatic Seizures, history of seizure 15 years back.

8.                It is apposite to mention that neither the complainant nor the opposite party tendered copy of proposal form submitted by the complainant at the time of purchasing the insurance policy. In the absence of any duly signed and authenticated proposal form the matter in controversy cannot be adjudicated upon in favour of the opposite party. The proposal form is material document from which it could have been easily assessed whether there was a concealment on the part of the complainant. Non-production of proposal form leads to inevitable inference that either the proposal form was not got executed before issuing the policy or there are certain anomalies and discrepancies in the proposal form, production of which may prove adverse to the rights of the opposite parties. It was also well within the legitimate rights of the opposite parties to get the complainant medically examined by the empanelled doctors but no such option was exercised.

9.                In this regard, reference can be made to  Manmohan Nanda Vs United India Assurance Co. Ltd. and others 2022(I) CPJ 20 (SC) wherein the Hon’ble Supreme Court of India has observed as under:-

“(6)   The appellant’s argument that there is no hard and fast rule that every person with DM-II will necessarily have a cardiac disease merely because it is a risk factor holds water. A person who does not suffer from DM-II can also suffer from a cardiac ailment. He had disclosed his DM-II status for which he was under treatment. The ECG report and other tests also indicated normal parameters. Further, statins were a preventive prescription to prevent development of cardiac issues as DM-II is a risk factor, not because he had a cardiac ailment or hyperlipidaemia. Further, the examining physician was informed of the same before the policy was taken. Accordingly, there was no suppression of any material fact by the appellant to the insurer.

(7)     It was for the insurer to gauge related complications based on the information provided. The insurance company did not think that the medical and health condition of the appellant was such which did not warrant issuance of a medical policy. The insurance company therefore did not decline the proposal of the assured as a prudent insurer.”   

Therefore, in our considered view, the rejection of the claim on the basis of   non-disclosure of pre-existing diseases could not have   been made a ground to   reject the claim.  The insurance companies are required to be more liberal in their approach without being too technical. In the given set of above said facts and circumstances, it would be just and appropriate if the denial letter dated 19.02.2010 Ex. R18 issued by the opposite party is set aside and the opposite party is directed to settle and reimburse claim lodged by the complainant in respect of his treatment along with composite costs of Rs.10,000/-.

10.              As a result of above discussion, the complaint is partly allowed with an order that the denial letter dated 19.02.2010 Ex. R18 issued by the opposite party is set aside and the opposite party is directed to settle and reimburse claim lodged by the complainant in respect of his treatment as per terms and conditions of the policy within period of 30 days from the date of receipt of copy of the order failing which the opposite party shall pay interest @8% per annum on the settled amount to the complainant from the date of order till its actual payment. The opposite party shall further pay a composite cost of Rs.10,000/- (Rupees Ten Thousand only) to the complainant. Payment of costs shall be made within a period of 30 days from the date of the receipt of the copy of this order. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.

11.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Monika Bhagat)          (Jaswinder Singh)             (Sanjeev Batra)

Member                         Member                              President        

 

Announced in Open Commission.

Dated:17.10.2023.

Gobind Ram.