Chandigarh

StateCommission

A/398/2014

Oriental Insurance Company Limited - Complainant(s)

Versus

Jasbir Pal Singh - Opp.Party(s)

B.S.Taunque, Adv.

16 Feb 2015

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

                                              

First Appeal No.	:	398 of  2014
Date of Institution	:	24.12.2014
Date of Decision	:	16.02.2015

 

Oriental Insurance Company Limited, Surendra Building, through its Deputy Manager (Legal), Regional Office SCO No.109-111, Sector 17-D, Chandigarh.

 …Appellant/Opposite Party.

Versus

Sh. Jasbir Pal Singh son of Sh. Bharpur Singh, resident of House No.3137, Pink Rose Society, Sector 49-D, Chandigarh.

…Respondent/Complainant.

 

Appeal under Section 15 of the Consumer Protection Act, 1986.

 

BEFORE: JUSTICE SHAM SUNDER (RETD.), PRESIDENT.

              SH. DEV RAJ, MEMBER.

              MRS. PADMA PANDEY, MEMBER.

             

Argued by:

 

Brig. B. S. Taunque (Retd.), Advocate for the appellant.

Ms. Hem Lata Thakur, Advocate for the respondent.

 

PER DEV RAJ, MEMBER

              This appeal is directed against the order dated 14.11.2014, rendered by the District Consumer Disputes Redressal Forum-I, UT, Chandigarh (hereinafter to be called as the District Forum only), vide which, it allowed the complaint, filed by the complainant (now respondent) and directed the Opposite Party (now appellant) as under:-

“17.      In the light of above observations, we are of the concerted view that the Opposite Party is found deficient in giving proper service to the complainant. Hence, the present complaint of the Complainant deserves to succeed against the Opposite Party, and the same is allowed, qua it. The Opposite Party is directed to:-

 

[a]   To pay the claim of Rs.2,72,616/- to the Complainant;

 

[b]    To pay Rs.25,000/-on account of deficiency in service and causing mental and physical harassment to the Complainant; 

 

[c]    To pay Rs.10,000/- as cost of litigation;

 

18.     The above said order shall be complied within 30 days of its receipt by the Opposite Party; thereafter, Opposite Party shall be liable for an interest @12% per annum on the amount mentioned in per sub-para [a] & [b] of para 17 above, apart from cost of litigation of Rs.10,000/-, from the date of institution of this complaint, till it is paid.” 

 

 2.          The facts, in brief, are that the complainant had obtained “Oriental Bank Mediclaim Policy” from the Opposite Party, on 12.07.2012, and got the same renewed, subsequently, vide Policy Annexure C-1, valid from 12.07.2013 to 11.07.2014. It was stated that on 12.12.2013, during the currency of the aforesaid Policy, the complainant was admitted in PGIMER, Chandigarh for Cardiac Arrest (CAD). It was further stated that after treatment, the complainant was discharged on 16.12.2013 and he had to bear medical expenses to the tune of Rs.2,72,616/- (Annexure C-2). It was further stated that a claim was, accordingly, lodged with the Opposite Party vide Annexure C-3. It was further stated that the Opposite Party vide letter dated 24.02.2014 (Annexure C-4) repudiated the claim of the complainant, on the ground of Exclusion Clauses 4.2 and 4.7 of the Policy. It was further stated that such exclusion clauses were not brought to the notice of the complainant by the Opposite Party, before finalizing the contract. It was further stated that the exclusion clauses were not negotiated between the parties so as to constitute a concluded contract and, thus, the same could not be considered for repudiation of the claim. It was further stated that at the time of issuance of the Policy, the complainant was told that he would be reimbursed all the medical expenses, borne by him, for any medical treatment. It was further stated, that nowhere in the medical history, it was mentioned that Hypertension, Diabetes or alcohol were the reasons for cardiac arrest. It was further stated that cardiac arrest nowhere fell in any of the exclusion clauses and the same was linked by the Opposite Party with the exclusion clauses without any valid basis, for avoiding to pay the genuine claim of the complainant.

3.           It was further stated that the aforesaid acts of the Opposite Party, in repudiating the claim of the complainant, amounted to deficiency, in rendering service, as also indulgence into unfair trade practice. When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only), was filed seeking direction to the Opposite Party, to pay the claim of Rs.2,72,616/- with interest @18% per annum from 16.12.2013; pay Rs.50,000/- as compensation for mental agony and physical harassment, besides Rs.11,000/- as cost of litigation.

4.           The Opposite Party, in its written version, stated that the Policy, in question, was purchased by the complainant, with open eyes, admitting the terms and conditions of the same as correct. It was further stated that the complainant was well aware of the terms and conditions of the Policy. It was admitted that the complainant was admitted in PGI on 12.12.2013 as per the documents submitted by him. It was further stated that the complainant concealed the true facts and did not disclose the pre-existing disease, and that he was alcoholic. It was further stated that the complainant was admitted in PGI for treatment of CAD, Hypertension with diabetes on 14.12.2013 and was discharged on 16.12.2013. It was further stated that as per the terms and conditions of the Policy, during the period of insurance cover, the expenses for hypertension and diabetes for specified period of 2 years were not payable, if contracted and/or manifested during the currency of the Policy. It was further stated that it was evident from the documents submitted by the complainant that he was alcoholic, which was a pre-disposing factor to the development of heart ailment. It was further stated that the documents provided by the complainant regarding the treatment were sent to T.P.A. [M/s Medi Assist India] and after examining the same, in the light of exclusion clauses No. 4.2 & 4.7, the claim of the complainant was rightly rejected, as the same did not fall under the terms and conditions of the Policy. It was further stated that neither there was any deficiency, in rendering service on the part of the Opposite Party nor it indulged into unfair trade practice. The remaining averments, being wrong, were denied.

5.           The complainant filed replication, wherein, he reiterated all the averments, contained in the complaint, and repudiated those, as contained in the written version of the Opposite Party.

6.           The Parties led evidence, in support of their case.

7.           After hearing the Counsel for the parties, and, on going through the evidence and record of the case, the District Forum, allowed the complaint, as stated above, in the opening para of the instant order.

8.           Feeling aggrieved, the instant appeal, has been filed by the appellant/Opposite Party.

9.           We have heard the Counsel for the parties and have gone through the evidence and record of the case, carefully.

10.         The Counsel for the appellant/Opposite Party, submitted that the Insurance Policy taken by the respondent/complainant in the year 2012 was renewed in the year 2013, which was effective for the period from 12.07.2013 to 11.07.2014. He further submitted that the sum insured, under the Policy, was Rs.3 Lacs. He further submitted that the claim was not repudiated on the ground of pre-existing disease, but the same was repudiated in terms of Clause 4.2 of the Policy, under which vide Sr. Nos.xvii & xviii, Hypertension and Diabetes were excluded for a period of two years. He further submitted that Exhibit R-4, which is Outpatient Card of PGI, indicated that the respondent/complainant had history of Hypertension and Diabetes Mellitus and he was also alcoholic.

11.         The Counsel for the respondent/complainant submitted that the Policy terms and conditions including the exclusion clauses were never supplied to the respondent/complainant. She further submitted that the appellant/Opposite Party failed to produce any expert report that cardiac arrest was due to intake of alcohol etc. She further submitted that as per Lab Report dated 7.12.2013 (Annexure C-5), Blood Sugar (Random) was 121, which was well within reference value range of 160 meaning thereby that the complainant was not diabetic and this report remained unrebutted.

12.         It is evident that the respondent/complainant obtained “Oriental Bank Mediclaim Policy” bearing No.231200/48/2014/432 (Annexure C-1) after paying the premium amount of Rs.4,620/-, from the appellant/Opposite Party, which was valid for the period from 12.07.2013 to 11.07.2014 and the sum insured was Rs.3 Lacs. Admittedly, on 14.12.2013, he (complainant) underwent surgery i.e. Coronary Angiography CAD in Cardiology Department in PGIMER. It is also evident from record that the respondent/complainant was discharged from PGIMER on 16.12.2013.

13.         The claim was repudiated by the appellant/Opposite Party vide letter dated 24.02.2014 (Annexure C-4) which reads as under:-

“We confirm the receipt of claim as per the reference given above. We state our inability to admit the liability due to the following:

Clause	Description
Exclusion 4.2	The expenses on treatment of following ailment/diseases/surgeries for the specified periods are not payable if contracted and/or manifested during the currency of the Policy. If these diseases are pre-existing at the time of proposal the exclusion no.4.1 for preexisting condition SHALL be applicable in such cases. xvii Hypertension. 2 Years xviii Diabetes. 2 Years.
4.7	Convalescence, general debility. “run down” condition or rest cure, congenital external and internal diseases or defects or anomalies, sterility, any fertility, sub-fertility or assisted conception procedure, venereal diseases, intentional self-injury/suicide, all psychiatric and psychosomatic disorders and diseases/accident due to any/or use, misuse or abuse of drugs/alcohol or use of intoxicating substances or such abuse or addiction etc.

 

On perusal of claim documents it is found that claimant covered under the above mentioned policy was admitted at PGIMER for the treatment of CAD, Hypertension with Diabetes on 14-12-2013 & Discharged on 16-12-2013. As per the Policy Terms & Conditions, during the period of insurance cover, the expenses on treatment of ailment/diseases/surgeries for Hypertension & Diabetes disease for specified periods of 2 yrs were not payable if contracted and/or manifested during the currency of the policy. As per the submitted documents it is evident that the claimant is alcoholic which is predisposing factors to the development of Heart Ailment. Hence, we regret our inability to admit this liability under present policy conditions and the claim is being repudiated under Exclusion 4.2 & 4.7 of above mentioned policy. We also reserve the right to repudiate the claim under any other ground/s available to us subsequently.

In case you have further facts or information to substantiate your claim, please forward the same to us.”

Though the claim was repudiated under Clauses 4.2 and 4.7 but in appeal, it has been submitted that the same was not payable under Exclusion Clause 4.2.

14.         The first question, which falls for consideration, is, as to whether the terms and conditions were supplied to the respondent/complainant. A specific objection to this effect has been taken by the respondent/complainant. In M/s Modern Insulators Ltd. Vs Oriental Insurance Co. Ltd., I (2000) CPJ 1 (SC), the principle of law, laid down, was to the effect, that it is the fundamental principle of Insurance law, that utmost good faith, must be observed by the contracting parties, and good faith forbids either party, from non-disclosure of the facts, which the parties knew. The insured has a duty to disclose all the facts, and similarly it was the duty of the Insurance Company, and its agents, to disclose all the material facts, in their knowledge, as obligation of good faith applies to both equally. It was, thus, the duty of appellant/Opposite Party to disclose all the facts and circumstances, relating to the insurance cover, in respect whereof the Insurance Policy was taken by the respondent/complainant. It was also required of the appellant/Opposite Party, to apprise the respondent/complainant of the benefits of insurance and the exclusion clauses, contained therein. It was, under these circumstances, the utmost duty of the appellant/Opposite Party to supply the Insurance Policy and the terms and conditions thereof, to the complainant, so as to enable him (respondent/complainant) to go through the same and understand the clauses contained therein. In United India Insurance Co. Ltd. & Anr. Vs S.M.S. Tele Communications & Anr., III (2009) CPJ 246 (NC), it was observed that being aware of the existence of the policy, is one thing, and being aware of the contents and meaning of the clauses of the policy, is another. It was the bounden duty of the appellant/Opposite Party to make the complainant aware of the terms and conditons. The appellant/Opposite Party has failed to establish with cogent and convincing evidence if the terms and conditions were supplied to the respondent/complainant. In view of the above, there was deficiency, in rendering service, on the part of the appellant/Opposite Party.   

15.         The next question, which falls for consideration, is as to whether the claim was rightly repudiated in terms of Clauses 4.2 and 4.7 of the Policy. It is evident from Exhibit C-2 that the respondent/complainant was admitted to the Emergency OPD on 12.12.2013 and thereafter, to Cardiology Department on 14.12.2013 and discharged on 16.12.2013. The claim has been repudiated by the appellant/Opposite Party on the ground that as per the Policy terms and conditions, the expenses on treatment of ailment/diseases/surgeries for Hypertension & Diabetes for specified period of 2 years were not payable. The medical record nowhere depicts that the expenses incurred were for the treatment of Hypertension & Diabetes. Therefore, the averment of the appellant/Opposite Party, in its written statement, that the treatment was for Hypertension & Diabetes is not correct. Not only this, as per the report dated 07.12.2013 (Annexure C-5), which was just a week before the respondent/complainant underwent treatment, his Blood Sugar random was 121 mg/dl which was well within the reference value of up-to 160. More so, no cogent evidence much-less expert evidence has been produced by the appellant/Opposite Party that Hypertension or Diabetes was the contributory factor for CAD. The District Forum in Para 11 of its order has rightly observed that cardiac arrest nowhere falls in any of the exclusion clauses and the same (cardiac arrest) was connected with hypertension and alcohol without any valid basis. When we look into the contents of Clause 4.2 of the Policy, no doubt vide Sr. Nos.xvii and xviii, Hypertension & Diabetes are to be considered as pre-existing diseases and are excluded but the list does not exclude the treatment of CAD. In the instant case, treatment was not for Hypertension or Diabetes but for CAD.

16.         Insofar as use of alcohol is concerned, though in appeal, the appellant/Opposite Party has not pressed this point, a perusal of Clause 4.7 reveals that the appellant/Opposite Party has failed to establish that use, misuse or abuse of alcohol by the respondent/complainant was responsible for CAD. The averment of the appellant/Opposite Party in Para 5 of the appeal “….. we all know from common knowledge that excessive alcohol aggravates the conditions of diabetes, hypertension, and also bad cholesterol”, cannot be given any significance when there is no evidence of use of excessive alcohol by the respondent/complainant. Even the sugar level was normal as is evident from Annexure C-5. In SBI Life Insurance Company Ltd. Vs. Smt. D. Leelavathi & Anr., I (2012) (1) CPJ 490 (NC), the National Commission held that the allegation of preexisting disease had to be proved by medical evidence, which in the instant case was lacking. In Sushil Kumar Jain Vs. United India Insurance Co. Ltd., I (2012) CPJ 204 (NC), it was held by the National Commission that the Insurer failed to produce any credible evidence including documentary evidence, or medical record, to show that the Insured had been treated for any pre-existing diseases. Similar is the situation, in the instant case, where, the appellant/Opposite Party failed to bring evidence, on record, that the respondent/complainant had earlier suffered from CAD. Further in Birla Sun Life Insurance Co. Ltd. Vs. Charakapu Chinna Rao, I (2012) CPJ 557 (NC), it was held by the National Commission that having used specific grounds, for repudiation of claim, it was necessary for the Insurer to produce supporting evidence.

17.         By repudiating the genuine claim of respondent/complainant illegally and arbitrarily, the appellant/Opposite Party was deficient in rendering service.

18.         No other point, was urged, by the Counsel for the parties.

19.         In view of the above discussion, it is held that the order passed by the District Forum, being based on the correct appreciation of evidence, and law, on the point, does not suffer from any illegality or perversity, warranting the interference of this Commission.

20.         For the reasons recorded above, the appeal filed by the appellant/Opposite Party, is dismissed, with no orders as to costs. The impugned order, passed by the District Forum, is upheld.

21.         Certified Copies of this order be sent to the parties, free of charge.

22.         The file be consigned to Record Room, after completion.

Pronounced.

February 16, 2015.

Sd/-

[JUSTICE SHAM SUNDER (RETD.)]

PRESIDENT

 

 

Sd/-

 (DEV RAJ)

MEMBER

 

 

Sd/-

(PADMA PANDEY)

       MEMBER

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