Haryana

StateCommission

A/980/2018

DALBIR SINGH MANN - Complainant(s)

Versus

ICICI PRUDENTIAL LIFE INSURANCE - Opp.Party(s)

GOBIND DHANDA

22 Mar 2023

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

HARYANA PANCHKULA

                  

                                                First Appeal No.980 of 2018

Date of the Institution: 16.08.2018

Date of order: 22.03.2023

 

Dalbir Singh Mann, age 57 years son of Shri Kanwar Bhan resident of House No.2189, Sector-7, Urban Estate, Karnal.

…..Appellant

Versus

1. ICICI Prudential Life Insurance Company Ltd. through its Branch Manager, Floor Shanti Colony, Mall Road, Karnal.
2. ICICI Prudential Life Insurance Company Ltd. unit no.1 & 2A, Raheja Tipco Plaza, Rani Sati Marg, Malad (East) Mumbai-400097.

                                                                                       …..Respondents

CORAM:    S.P. Sood, Judicial Member

                    Suresh Chander Kaushik, Member

                   

Present:-    Mr. Gobind Dhanda, Advocate for the appellant.

                   Mr.Hitender Kansal, Advocate for the respondents.

 

O R D E R

S P SOOD, JUDICIAL MEMBER:

          The present appeal has been preferred against the order dated 11.07.2018 passed by the District Consumer Disputes Redressal Forum, Karnal (in short Now ‘District Commission) vide which the complaint was dismissed.

2.      Briefly stated, facts of the case as per the complainant that he purchased Health Insurance Policy from OPs under the name and style of ‘ICICI Prudential Health Saver’ and paid premium of Rs.15,000/-. After depositing the premium amount OP issued a policy bearing No.12770031 dated 24.10.2009 to the complainant which is valid upto 22.10.2017 with the assurance that under this health policy complainant individually is fully insured and would get the medical claim upto Rs.3 lakhs, upto the age of 75 years. On 05.01.2017 complainant suffered chest pain and remained admitted in Amritdhara Hospital Karnal from 05.01.2017 to 06.01.2017. Thereafter he was shifted to Medanta Global Health Pvt. Ltd., Delhi where he remained admitted form 06.01.2017 to 08.01.2017 and spent Rs.3,15,315/- on his treatment. After being discharged from the hospital, complainant approached OPs and submitted all the relevant documents. Thereafter complainant visited the office of OPs several times and requested for reimbursement of the amount but OPs postponed the matter on one pretext or the other and finally rejected the claim of the complainant vide letter dated 27.4.2017 on the false ground. Thus, there being deficiency in service on the part of the OPs, hence the complaint.

3.      Notice was issued to the Ops following which they appeared and filed separate written version with the averments that complainant submitted a health claim intimation on 16.01.2017 alongwith medical documents informing about his hospitalization from 05.01.2017 to 06.01.2017 in Amritdhara Hospital Karnal and thereafter in Medanta Global Health Pvt. Ltd. Delhi where he remained admitted from 06.01.2017 to 08.01.2017 and submitted bills amounting to Rs.3,15,315/- towards medical expenses. The intimation of claim was received by the OP company on 16.1.2017 and after evaluating, his claim, was rejected due information in this regard was sent to the complainant on 27.04.2017 i.e. within 6 months of claim intimation. The claim was rejected on the grounds that as per the policy documents, the company was not liable to pay for expenses incurred by the insured person where such expenses were connected to a pre-existing condition. In the present two claims, for acute myocardial infarction and coronary artery disease, dysfunction, single vessel disease, hypertension they were both in connection to the complainant’s pre-existing condition of heart blockage due to which he underwent a Percutaneous Transluminal Coronary Angioplasty (“PTCA”) with stent to LCx and LAD. Hence there was direct nexus between the undisclosed pre-existing condition and the subject claim. Life assured had concealed the material facts which were necessary to be disclosed at the time of taking insurance, thereby rendering the contract of insurance void-ab-initio and inoperative, which was cited as the reason for the claim being repudiated. It was duty of the assured at the time of availing the policy, to disclose this material information, which was essential for the purpose of underwriting, during issuance of an insurance policy. On 30.10.2009 policy documents including policy terms and conditions and a forwarding letter stating the fee look provision alongwith copy of proposal form were sent to the complainant which were duly received by him but OPs never received any freelook cancellation from the complainant which meant that he accepted the terms and conditions of the policy and finally requested to dismiss the complaint as prayed for.

4.      After hearing both the parties, District Consumer Disputes Redressal Commission, Karnal dismissed the complaint vide impugned order dated 11.07.2018, which is as under:-

“From the above facts and circumstances of the case, it is clear that the OPs have proved on the file that the complainant had underwent Post PTCA+ Stent to LCx & LAD in August 2009 as this fact is clear from the document Ex.R4, issued by Medanta Global Health Pvt. Delhi hospital which was attached by the complainant with his claim papers and these material facts has been concealed and not disclosed by the complainant at the time of taking the policy. In view of the facts and circumstances of the case, we are of the considered view that the OPs have committed no mistake in repudiating the claim of the complainant. Hence we found no deficiency on the part of the OPs.

       Thus, as a sequel to above discussion, we do not find any merits in the complaint and the same is hereby dismissed.”

 

5.                Feeling aggrieved therefrom, complainant-appellant has preferred this appeal.

6.                The arguments have been advanced by Sh. Gobind Dhanda, learned counsel for the appellant as well as Sh. Hitender Kansal, Advocate for the respondents.  With their kind assistance the entire record including documentary evidence as well as whatever evidence has been led during the prosecution of the complaint has also been properly perused and examined.

7.       Learned counsel for the appellant argued that at the time of issuance of medical health policy it was the duty of the respondents to have got conducted medical examination of the appellant to ascertain whether he was having any disease before the issuance of the policy. But respondents did not got ahead with any medical examination of the appellant and ow have wrongly repudiated his claim on false ground of concealing the pre-existing disease. Appellant purchased the medical health policy in the year 2009 and present medical claim relates to January, 2017. Appellant has paid premium for 8 years regularly and as per Section 45 of the Insurance Act respondents were liable to pay the medical claim to the appellant. Learned District Commission wrongly dismissed the complaint of the complainant. The complainant is entitled for the claim amount as prayed for.

8.      Learned counsel for the respondents argued that at the time of purchasing medical health policy appellant suppressed material facts about his medical condition and also about his pre-existing disease in clear  violation of terms and conditions of the medical health policy. Therefore, learned District Commission has rightly dismissed the complaint and also prayed for dismissal of the appeal as well. 

9.                It is admitted that that appellant purchased medical health policy in the year 2009 and thereafter he kept on paying policy premium regularly. It is also admitted that in January, 2017 appellant experienced chest pain and remained admitted in Amritdhara Hospital Karnal from 05.01.2017 to 06.01.2017 and also thereafter in Medanta Global Health Pvt. Ltd., Delhi form 06.01.2017 to 08.01.2017 and ended up spending Rs.3,15,315/- on his treatment. As per Ex.R-4 issued by Medanta Hospital it has been mentioned under the head Previous Intervention: Post PTCA+Stent to LCx & LAD (Aug 2009).  The complainant has been paying the premium regularly for eight years.  It is also a settled law that if any individual does not face or come across  relapse of any health issue continuously for two years after his having faced the similar problem earlier, then insurance company cannot set up the said persons previous encounter to the disease as a reason for repudiating his medical claim raised thereafter.  On the similar analogy even after four years of any health insurance, policy continuing without any gap without any  claim having been raised during these four years, then thereafter insurance company cannot repudiate any claim raised by the insured even on the ground of his suffering from any pre-existing disease in the past. In the light of the above stated position of law, in the case in hand the appellant had purchased the health insurance policy in 2009 and after this policy having continued for almost eight years without any gap or break now when insured suffered some problem in the year of 2017 then how can OPs be permitted to disallow the claim for non-disclosure of previous ailment.  It is the responsibility of the opposite party to conduct the test of the complainant at the time of issuing the policy as he was near about 50 year old, but, the OP in its own discretion did not conduct medical examination at that time. Thus there was no pre existing disease at the time of obtaining the policy.

10.    It is a matter of common experience, insurance companies often repudiate claims on grounds of non-disclosure of material information by the consumer. However they conveniently forget that there is an even greater statutory obligation cast on them to give full information to the consumer about the products they sell.

The responsibilities of the insurer towards full disclosure is even more because (a) the Insurance Regulatory and Development Authority’s (IRDA) Regulation on the protection of Policyholders’ Interests’ specifically mandates this and (b) the contracts of insurance, which are ‘Adhesion Contracts’ or ‘Standard Form Contracts’ are drawn up unilaterally by the dominant party-the insurer. The consumer, being the weaker party has no bargaining power, nor knowledge of the terms of the contract. So, the apex court has often said that these contracts, therefore, demand a very high degree of fairness, good faith and disclousure on the part of the insurer.

          Here are two cases where the Supreme Court has reminded insurers of their obligation in this regard and warned them against violations. The two cases also show-case the kind of unfair practices indulged in by insurers.

          In Texco Marketing Pvt. Ltd. Vs TATA AIG General Insurance (CA No. 8249 of 2022, date of judgment: November, 9, 2022), for example the insurance company insured after due inspection, a shop loacated in a basement under the Standard Fire and Special Perils Policy, despite the fact that the policy specifically excluded basements. Subsequently, following a fire, when the policyholder made a claim, the insurer repudiated it on the basis of the exclusion clause!

          While ruling in favour of the consumer, the apex court observed that first and foremost, the insurer did not bring the exclusion clause to the notice of the consumer. And then, despite having knowledge of the exclusion clause, it insured the basement and received the premium benefits. After this, repudiating the policyholder’s claim on the basis of the exclusion clause was certainly an unfair trade practice. “This view is fortified by the finding that the exclusion clause is an unfair term, going against the very object of the contract, making it otherwise un-executable from its inception,” the apex court said.

          Some of the observations of the court in this case would go a long way in upholding the rights of the policyholders. For example, the court made it clear that an exclusion clause, if not brought to the notice of the consumer by the insurer or agent, would not be binding on the consumer. Similarly, an unfair term in an insurance contact would be un-executable. The Supreme Court also reminded insurers that an exclusion clause “is not a leverage or safeguard for the insurer, but is meant to be pressed into service on a contingency, being a contract of speculation”.

          Said the court: “Before we part with this case, we would like to extend a word of caution to all the insurance companies on the mandatory compliance of Clause (3) and (4) of IRDA Regulation, 2022. Any non-compliance on the part of the insurance companies would take away their right to plead repudiation of contract by placing reliance upon any of the terms and conditions included thereunder”.

11.              The complainant has not violated the terms and conditions of the insurance policy. The complainant is entitled for Rs.3,15,315/- on account of medical expenses. Learned District commission has wrongly decided the case of the complainant. Hence, the impugned order dated 11.07.2018 is set aside. The appeal  as well as complaint is allowed.   The respondent is directed to pay Rs.3,15,315/- to the complainant-appellant. In case, there is a breach in making payment within the stipulated period  of  45 days, in that eventuality, the complainant-appellant would further be entitled to get the interest @ 9% per annum, for the defaulting period till realization.   The complainant-appellant is also entitled of Rs.50,000/- (Fifty Thousand Only) for compensation of mental and physical agony.  In addition, the complainant-appellant is also entitled of Rs.5500/-  (Five Thousand  and five hundred Only) as litigation charges. 

12.    Application(s) pending, if any, stand disposed of in terms of the aforesaid order.

13.    A copy of this order be provided to all the parties free of cost as mandated by the Consumer Protection Act, 2019. This order be uploaded forthwith on the website of the Commission for the perusal of the parties.

14.    File be consigned to record room.

 

 

22nd March, 2023   Suresh Chander Kaushik            S. P. Sood                                                                Member                                             Judicial Member    

S.K(Pvt. Secy.)