Kerala

Idukki

CC/7/2021

Abraham jose - Complainant(s)

Versus

Life insurance corporation of India - Opp.Party(s)

14 Jul 2022

ORDER

DATE OF FILING :  15.1.2021

IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, IDUKKI

Dated this the   14^th  day of  July,  2022

Present :

SRI. C. SURESHKUMAR                   PRESIDENT

SMT. ASAMOL P.                             MEMBER

SRI. AMPADY K.S.                           MEMBER

CC NO.7/2021

Between

Complainant                                           :   Abraham Jose,

                                                                  Ottaplackal House,

                                                                  Amaravathy P.O.,

                                                                  Kumily, Idukki – 685 509.          

       (By Advs: Dr. Shine Varghese

& Babichen V. George)

And

Opposite Parties                                     : 1.  Life Insurance Corporation of India

                                                                    Represented by Authorised Signatory,

                                                                   Corporate Office, 5^th Floor,

West Wing, Yogakshema,

Jeevan Bhima Marg, Nariman Point,

Mumbai, Maharashtra – 400 021.

      2. The Manager (Health Insurance)

Life Insurance Corporation of India,

Divisional Health Unit,

Divisional Office, Kottayam.

      3. The Senior Divisional Manager,                              Life Insurance Corporation of India,

Divisional Health Unit,

Divisional Office, Kottayam.

                                                                4. The Branch Manager,

                                                                   Life Insurance Corporation of India,

                                                                   Branch Office, Vandiperiyar P.O.,

                                                                   Idukki – 685 533.

 (All by Adv: M.V. Francis)

                                                                                                                                    (cont....2)

• 2  -

O R D E R

 

SRI. C. SURESHKUMAR, PRESIDENT

 

This is a complaint filed under Section 35 of the Consumer Protection Act, 2019 (the Act, for short).  Case of complainant is briefly discussed hereunder :

 

          Complainant is the principal insured of LIC’s Jeevan Arogya (table 903) Health Insurance Policy under Life Insurance Corporation of India vide policy No.395499425 commencing from 20.11.2012.  Complainant used to pay premium on yearly basis.  On 7.11.2019, he had renewed the policy for the year 2019-2020 vide transaction No.69787211 by paying Rs.14,792/-.  1^st  opposite party is Life Insurance Corporation of India represented by its authorized signatory with its Corporate  Office in Mumbai.  2^nd opposite party is Manager (Health Insurance), Life Insurance Corporation of India having its office at Kottayam.  3^rd opposite party is Senior Divisional Manager of LIC having its Divisional Office at Kottayam and 4^th opposite party is Manager of Vandiperiyar Branch of LIC of India.  In 2012, when the complainant had applied for Health Insurance Policy via, one of the agents, namely, Mrs. Vijayapriya K.N. (Agency Code : 3068178T), to 4^th opposite party viz, Manager of Vandipperiyar Branch of LIC, he had directed the complainant to take medical check up and to produce test results.  Complainant had undergone all the proposed medical check ups including special Bio-Chemical Tests.  No abnormalities were detected in any of the tests.  At that time, fasting blood sugar level of complainant was 90 and S. Creatine is 0.9 mg %.  After thorough verification of health condition of complainant, a health insurance policy, namely, Policy No.395499425 commencing from 20.11.2012 was issued to him.  Every year as directed by opposite parties, insurance premium was paid by complainant regularly.  Till 2019, complainant had not made any claims.  He was not admitted in any hospital for medical treatment.   On 15.1.2020, he was admitted in Lissie Hospital, Ernakulam owing to chest pain.  He was admitted and discharged on 17.1.2020.  Initially he had spent Rs.20,607/- towards hospital expenses.  Complainant was again admitted in the same hospital on 20.1.2020, for the same ailment.  This time he was admitted and treated till 23.1.2020.  He had spent Rs.87,082/- for his hospital expenses.  Thereafter complainant was again admitted on 12.2.2020 in the same hospital.  He had undergone open heart surgery and was discharged on 21.2.2020. He had spent Rs.3,42,312/-.  In total complainant had spent Rs.4,50,001/- towards hospital expenses.

                                                                                                          (cont….3)

• 3  -

          Complainant contends that all the treatment expenses were covered by his health insurance policy issued by opposite party.  He had submitted a claim form on 4.3.2020 to 2^nd opposite party through 4^th opposite party claiming the aforesaid Rs.4,50,001/-, towards health insurance claim, as principal insured.  Claim was forwarded to 2^nd opposite party as per letter dated 4.3.2020.

 

          Third opposite party denied the claim vide letter dated 3.9.2020, for the reason that there was pre-existing illness (Diabetes Mellitus since 20 years) and therefore irrespective of prior medical treatment or advice for same claim cannot be allowed.  Claim was denied without giving an opportunity to complainant for hearing.  Complainant became a diabetic only in 2015.  He had thereafter commenced treatment for the same upon advice by his doctor, namely, T.N. Soman, M.B.B.S., M.D., at Vandipperiyar.  This fact was informed to 4^th opposite party through the agent, Mrs. Vijayapriya K.N.  Upon getting information about the health condition of complainant, 4^th opposite party had directed him to renew the policy by payment of yearly premium.  All these aspects were explained to 2^nd opposite party.  Complainant had also produced treatment certificate dated 3.10.2020 issued by Dr. T.N. Soman, M.B.B.S., M.D., Vandipperiyar, before 3^rd opposite party to prove his claim.  However, 3^rd opposite party had denied the claim without even reading the certificate. 

 

          Complainant submits that opposite parties had violated the terms of contract of insurance.  They have purposefully denied the right of complainant.  A lawyer notice was issued on 13.11.2020 by complainant to 3^rd opposite party calling upon him to pay insurance amount.  He had sent a reply notice denying the claim on 23.11.2020. 

 

          Opposite parties had no reason to delay or deny the claim of complainant.  Their acts amount to deficiency in service and unfair trade practice.  Complainant had suffered mental agony, pain and financial loss also due to such acts of opposite party.  They are bound to reimburse the treatment expenses and also to compensate the complainant. Complainant prays for payment of insurance claim of Rs.4,50,001/- by opposite parties along with 12% interest per annum from 3.9.2020 till realization and also for compensation of Rs.25,000/- for the mental agony suffered along with costs of the proceedings as deemed fit and proper by this Commission.

 

          Opposite parties have appeared and filed a joint written version.  Their contentions are briefly narrated below :                                           (cont…4)

• 4  -

          According to opposite parties, complaint is not maintainable either in law or upon facts.  Policy issued to complainant is Jeevan Arogya policy under plan 903, number of policy being 395499425, from LIC of India, Vandipperiyar branch.  It had commenced on 20.11.2012.  Principal insured is the complainant and his spouse is the additional insured person.  Both are members covered by said policy which has an yearly premium of Rs.14,792/- and was paid upto 11.2.2020. 

 

          This policy is a non unit linked health insurance policy with declared benefits based on the initial cash benefit opted by policy holder at the inception of policy.  It is issued on the basis of health and personal details of the proposer as disclosed by the proposer in his proposal form for insurance.  Complainant had, as per his proposal, opted for hospital cash benefit of Rs.2000/- per day.  Jeevan Arogya policy is a health insurance policy which provides declared benefits subject to terms and conditions and exclusions mentioned in the policy document.  Benefits of this policy are not directly related to bill amount spent by the insured for treatment.  It is not a medi claim policy which reimburses the bill amount spent by the insured.  Declared benefits under Jeevan Arogya policy are :

1)   Hospital Cash Benefits (HCB)

2)  Major Surgical Benefit (MSB) for 140 listed surgeries.

3)  Day Care Procedure Benefits (DCPB) for 140 listed day care procedures.

4)  Other Surgical Benefits (OSB) for surgeries which are not covered by MSB and DCPB, to be considered in accordance with terms and conditions and policy exclusions mentioned in policy.

 

          In this case, complainant had opted Hospital Cash Benefit (HCB) Rs.2000/- per day for both insured.  MSB is 100 times of Hospital Cash Benefits and it increases at the rate of 5% every year after completion of one year subject to a maximum of 50%. 

 

          Policy issued to complainant provides only declared benefits based upon Hospital Cash Benefits opted by complainant / principal insured, subject to the terms and conditions and exclusions mentioned in the policy which have been mutually agreed by complainant, 2^nd insured and the corporation.

 

          Complainant was admitted 1^st on 15.1.2020 in Lissie hospital for coronary artery disease.  He was discharged on 17.1.2020.  Complainant was again admitted in the same hospital on 20.1.2020 and discharged on 23.1.2020.  Complainant was admitted for the 3^rd time on 12.2.2020 for open heart surgery in the same hospital and was discharged on 21.2.2020 after completion of procedure.                (cont…5)

• 5  -

          As per discharge summary produced, insured had a history of Diabetes Mellitus.  Hence 3^rd party appraiser (TPA) had asked for details regarding exact duration of diabetes from insured.  As per treatment certificate issued by Dr. Jose Chacko Periappuram, who was treating the complainant, complainant had a history of diabetes for 20 years.  Insurance policy was issued in 2012.  Treatment certificate would reveal that the complainant was under treatment for diabetes from 2000 or even earlier. This fact was not disclosed at the time of taking policy.  Hence TPA rejected claim of insured under rejection code, pre-existing disease (PED) H01 on 14.5.2020.  Said rejection paper is submitted along with written version.  Complainant had answered in the negative to question 10 (7) (ii) which called for health details and information regarding diabetes or raised blood sugar.

 

          Thus it is clear that insured had deliberately suppressed material facts concerning his condition of diabetes at the time of taking policy.  It is specifically provided in page No.6, of Jeevan Arogya proposal that the proposal will be rejected if the person is a known case of diabetes mellitus.  If the complainant fails to disclose his existing illness, namely, diabetes, the policy would not have been issued.  History of diabetes was a material fact and was within the direct knowledge of complainant.  He was obliged to disclose the same correctly in the proposal form.

 

          After rejection of claim by TPA, opposite parties have placed the claim before the Divisional Office Dispute Redressal Committee (DODRC) for reviewing and reconsidering the same.  DODRC, on the basis of facts mentioned above which had lead TPA to reject the claim, concluded that it was a clear case of non-disclosure of existing illness at the time of taking policy which had lead to its wrong acceptance by opposite party.  That if the past history were to be disclosed, the policy would not be issued at all.  Complainant had obtained the policy in violation of 19(XII) of terms and conditions of the policy, by practicing fraud.  Therefore, the policy is void.  Final rejection letter was sent to complainant on 30.9.2020.

 

          Thereafter complainant had issued lawyer notice dated 13.11.2020 to which opposite party had sent a reply dated 21.11.2020.

 

          In the alternative, it is contended in written version that if the policy were to be taken as duly issued, the amount payable would be as here under :

 

                                                                                                (cont….6)

• 6  -

Date and Time of admission	Date and Time of Discharge	Eligible for	Calculation	Amount in Rs.
15.1.2020 18.00 Hrs.	17.1.2020 16.00 Hrs.	Day Care	5 times X 2,900.00 5% increase every year to maximum 50%	14,500.00
20.1.2020 17.06 Hrs.	23.1.2020 17.00 Hrs.	OSB for 3 days + HCB for 2 days	OSB for 3 days X 2 times X 2,900.00 + HCB for 2 days X 2,900.00	17,400.00   5,800.00
12.2.2020 14.00 Hrs.	21.2.2020 17.00 Hrs.	MSB for 9 days + HCB for 9 days	MSB 100 times X 2,900.00 HCB 9 days X 2,900.00	2,90,000.00    26,100.00

 

Thus in the alternative, complainant would be eligible for Rs.3,53,800/- only, as per the policy.

 

          Opposite parties concluded by saying that there was no deficiency in service offered and given by them to complainant and therefore complaint is to be dismissed.

 

          After affording sufficient opportunity to both sides for taking steps, the case was posted for evidence.  On the side of complainant, he himself was examined as PW1 and Exts.P1 to P18 were marked on  his side.  On the side of opposite parties,  Manager (Legal and HPE), authorized signatory of LIC was examined as RW1 and Exts.R1 to R9 were proved by him.  Thereafter evidence was closed.  Both sides have filed argument notes.  They were also heard in reply.

 

 Now the points which arise for consideration are :

1)   Whether complainant was entitled to receive claim benefits under Ext.P1 policy from opposite parties ?

2)  Whether rejection of claim  was proper ?

3)  Whether complainant was entitled to get full reimbursement of treatment expenses or only a part of the same amounting to Rs.3,53,800/- as contended by opposite parties ?

4)  Whether there was deficiency in service in not disbursing the amount due as per policy, to complainant from the side of opposite parties ?

5)  Quantum of treatment expenses to be awarded and entitlement for compensation prayed for ?

6)  Reliefs and costs ?                                                                        (cont….7)

-  7  -

 

 Point Nos.1 to 5 are considered together :

 

          Contentions addressed as per argument notes submitted by the learned counsel for complainant, contain a brief discussion of rival pleadings addressed along with that of  evidence tendered by both sides.  It is further stated in the notes that the 3^rd opposite party had denied the claim of complainant upon the premises that he had diabetes mellitus since 20 years, which was not disclosed in DGH, without giving an opportunity to complainant for being heard.  In fact, complainant was diagnosed with diabetes mellitus only in the year 2015.  He commenced treatment for the same as advised by Dr. T.N. Soman, MBBS, MD, who is practicing at Vandipperiyar.  Rejection of claim was on the basis of Ext.R3, medical certificate to be issued by Dr. Jose Chacko, Periappuram.   This certificate was produced by opposite parties and it was not formally proved by them by examining the doctor who had issued the same.  Complainant upon confrontation with Ext.R3 has stated that it was not the one pertaining to him issued by doctor who had treated him in Lissie hospital.  According to complainant, Ext.R3 is a vague document.  Without examination of the author of the certificate as mentioned therein, the certificate cannot be admitted in evidence or relied upon by this Commission.  There is an extract from the evidence tendered by RW1 during cross examination to the effect that the witness had not seen any document other than Ext.R3,relating to treatment of the complainant for diabetes for 20 years in Lissie hospital at Ernakulam. Witness has further admitted that before complainant was admitted in the hospital for open heart surgery, he had taken treatment there as inpatient, two times before the surgery.  That he is not aware whether complainant had taken treatment for any other ailment or disease from the same hospital.  In the light of the evidence tendered by RW1, during cross examination, on the premises that Ext.R3 was to be proved by the author of certificate, complainant contends that Ext.R3 cannot be considered as evidence of him being effected with diabetes mellitus for 20 years and more.  Moreover, complainant has submitted that Ext.P18 medical certificate dated 3.10.2020 issued by his doctor T.N. Soman, who is practicing in Vandipperiyar.  It is mentioned in Ext.P18 that the complainant was being treated by the said doctor for diabetes mellitus since 2015 (1^st detected).  This certificate has not been challenged during cross examination of PW1.  The certificate bears the signature of complainant also.  Therefore, Ext.P18 is evidence of the fact that complainant become diabetic only in the year 2015.  As declaration of good health from was obtained in 2012, when he had initially taken the policy, at a time when he had no such ailment, he had truly answered that he was not                                                                                                                   (cont….8)

• 8  -

having diabetes.  He would further contend that opposite parties have collected premium amount for the policy from 2012 onwards upon annual renewal.  The one and only claim made by complainant for consideration was rejected and he was constrained to file this case seeking reimbursement of treatment expenses.  Opposite parties are legally obliged to seek details regarding medical conditions of prospective customers, who submit proposal form for getting insurance policies.  PW1 had produced all his medical records and given all details with regard to his physical condition to opposite parties in 2012 itself.  It was after scrutiny of all the records and medical examination of complainant, that Ext.P1 policy was issued to him.  Hence opposite parties cannot now contend that there was a pre-existing illness which had lead to the heart condition for which treatment become necessary. Repudiation of policy by opposite parties was illegal.  Complainant is entitled to be indemnified for the policy.  He is relying upon decision of Hon’ble Supreme Court in Civil Appeal No.8386/2015 (Manmohan Nanda Vs. United India Assurance Co. Ltd. and another)

 

          Learned counsel for opposite parties had also filed argument notes.  In the notes, learned counsel had reattriated the contentions raised in the written version in brief.  It is contended that policy issued to complainant is not a mediclaim policy, whereby reimbursement of entire bill amounts can be claimed. The policy provides only declared benefits based on Hospital Cash Benefits (HCB) opted by complainant who is the principal insurer subject to the terms and conditions and policy exclusions in the policy as agreed between the insured and insurer.  Policy was issued on the basis of personal details including that of health of policy holder disclosed by him in the proposal form. While filling up questionnaire in the proposal form, complainant had answered in the negative, a query as to whether he has any pre-existing illness like diabetes mellitus or raised blood sugar. In the discharge summary produced by insured along with his claim, it was found that he had a history of diabetes mellitus.  Hence 3^rd party appraiser (TPA) had called for exact duration of diabetes from the insured.  He has produced Ext.R3 certificate dated 23.4.2020 issued by his treating doctor, namely, Dr. Jose Chacko Periappuram. In the certificate, it was mentioned that the insured had a history of diabetes for the past 20 years.  Policy was issued in 2012.  It was clear that insured had diabetes prior to issuance of policy and was undergoing treatment for the same from the year 2000 onwards.  Therefore TPA had rejected the claim under rejection code, pre-existing disease (PED) H01 on 14.5.2020.  It is further contended that complainant by obtaining Ext.P1 policy in violation of clause 19(xii) of policy conditions and privileges concerning the Jeevan Arogya policy,                                                                                                                    (cont….9)

• 9  -

had practiced fraud.   It is mentioned in clause 19(xii) that if any fraudulent claim is made, policy becomes void.  Premium paid under the policy will be forfeited and all claims of payment in respect of the insurance under the policy shall be forfeited.  Non-disclosure of any health event or ailment / condition / sickness or surgery which had occurred prior to taking of policy will constitute fraud or material non-disclosure by the insured.  Hence complaint is to be dismissed.  Firstly on the ground of fraud as defined in clause 19(xii) of policy condition.  Secondly, complainant had opted for Hospital Cash Benefit (HCB), which is, Rs.2000/- per day for both the insured.  Major Surgical Benefit (MSB) is 100 times of hospital cash benefit (HCB) and it increases at the rate of 5% every year after completion of one year subject to maximum of 50%.

 

          Policy is not a mediclaim policy, reimbursing the bill amount claimed.  It provides only a declared cash benefits of  HCB paid by principal insured subject to the terms and conditions of the policy.  Following decisions were also relied upon by the able counsel for opposite parties. 

 

1. Order of NCDRC, New Delhi, in Revision Petition No.650 of 2020 dated 15^th October, 2020 (LIC of India Vs. Rajesh Kumar) held in the ‘non disclosure of pre existing disease diabetes mellitus in the proposal’, the NCDRC observed that DLA (Diseased Life Assured) was suffering from Rheumatic Heart Disease and Diabetes Mellitus prior to submission of the proposal form and LA was under an obligation to mention the true facts about her health.  The complainant cannot take the defense that proposal form was filled up by the agent and LW was unaware of its contents.  Accordingly Hon’ble NCDRC set aside the order of State Commission and dismissed the complaint.
2. Order of NCDRC New Delhi, in Revision Petition No.533 of 20177 dated 18^th May, 2017 (Sonu Vs. Birla Sun Life Insurance Company Ltd. and 2 others) :  Nondisclosure of pre existing disease – Diabetes Mellitus and as per medical science diabetes is a killer disease and if not properly controlled and cured it can result in hyper tension as also lead to heart problem or failure of other organs.  They find no merit in the revision petition and is accordingly dismissed.
3.  Order of Supreme Court, in Civil Appeal No.3944 of 2019 dated 15^th April 2019 (LIC of India Vs.  Manish Gupta), in nondisclosure of pre existing disease – Rheumatic heart disease since from child hood : The ground for repudiation of claim was in terms of the exclusions contained in the policy.                                                                                                  (cont…10)

• 10  -

The failure of the insured to disclose the past history of cardiovascular disease was a valid ground for repudiation. The appeal allowed and set aside the impugned judgment and order dated 10^th December, 2018 of the NCDRC.The complaint filed by respondent is dismissed.

 

On this premises, able counsel prays for dismissal of the complaint with cost. 

 

          Thus, these are the rival contentions.  We have considered the contentions advanced by both sides in the light of evidence tendered in this case.  Out of P1 to P18 documents, complainant would mainly rely upon Ext.P18, medical certificate to contend that he was detected to have diabetes only in 2015.  Contention of complainant is that Ext.R3, which is another medical certificate issued by Dr. Jose Chacko of Lissie hospital was not produced by him before opposite parties or TPA in connection with his claim.  That he had never mentioned of having diabetes since last 20 years of his treatment in Lissie hospital to said doctor or anyone else.  Per contra, opposite parties have contended that Ext.R3 was produced by complainant himself in support of his claim before TPA. The  probability of opposite parties forging a certificate merely to disallow the claim raised by complainant are very rare.  It can be gainsaid that such possibility is absolutely nil.  There are no  extra ordinary circumstances to prove otherwise of bias or  of enmity which would probablise that opposite parties had any vested interest in persona or an agenda to dishonour any claim preferred by complainant, which may even jeopardise their very job or career prospects. That apart, R3  medical certificate is shown to be issued by a famous Cardiologist, who is head of department of cardiology in Lissie hospital at Ernakulam, a well known medical institution.  There is hardly any possibility of the doctor being coerced into issuing such a certificate or opposite parties forging the same. Till date no criminal complaints have been filed by complainant against opposite parties on these premises.

 

However, we notice that Ext.R3 was not formally proved by the doctor, that is, Dr. Jose Chacko, who had issued the same.  It is mentioned in the certificate that it is issued ‘to whom so ever it may concern’ and  that as per medical records, Mr. Abraham Jose, the complainant herein, had history of Dyspnea on exertion – class II since 1 year.  That he has history of diabetes mellitus since 2 years and hypertension since 2 years.  Thus, going by the certificate, history of diabetes mellitus and hypertension so mentioned in the certificate apparently is not taken from medical records of the patient. If converse be the case, necessarily TPA could have earlier or opposite parties subsequently, called for the same from the                                                                                                                      (cont….11)

• 11  -

Hospital. In this connection, it would be also pertinent to note that in Ext.R8, admitted from the side of opposite parties, it is mentioned in clause 7 that, complainant had, upon enquiry, given a letter that he is having diabetes mellitus since 5 years only and the person who had accompanied him had wrongly conveyed it as 20 years.  Therefore we are of the view that it was necessary on the part of opposite parties to summon and examine Dr. Jose Chacko for proving Ext.R3,so that,  it would have been possible to ascertain whether history of diabetes mellitus was given to him by the complainant / patient himself or not.  We  also notice that signature of complainant is not taken upon the certificate issued by the doctor.    Therefore, non examination of author of R3is a fatal omission. It is true that no efforts were taken by complainant also to summon and examine the author of Ext.P18 certificate. Ordinarily as the claim had arisen when the policy was live, burden was upon opposite parties to prove that they are not liable to indemnify complainant in connection with his claim for special reasons.  Therefore failure to adduce formal evidence to substantiate Ext.P18 is not of much consequence, where as failure on the part of opposite parties to summon and examine the author of Ext.R3 invites dire consequences.  For these reasons, we find that Ext.R3 alone is not sufficient to prove that the complainant was a diabetic for 20 years since submission of his claim. R2,R4 and R5 were pressed into service to substantiate R3. However, complainant has a specific case that he was first diagnosed to have diabetes only since 2015 and hence despite R2, R4 and R5 it was necessary to prove R3 by examining it’s author. There is no reliable evidence to prove that complainant had diabetes when he had given R1 proposal and consequently we find that there is no evidence to prove that there was concealment of any health condition consciously by him while giving R1 which would disentitle him from being insured along with his wife.

 

Opposite parties have also contended that DM type 2 had led to heart condition of complainant for which treatment related to claim became necessary. Firstly, there is no expert evidence in this regard. Secondly, R2 to R4 and R5 only show that DM type 2 and hyper tension are risk factors and not the only causes for the heart ailment of complainant. In the cited supra by counsel for complainant, hon’ble Supreme Court has observed that acute myocardial infraction can occur in a person who has no history of diabetes mellitus and that diabetes mellitus -22 is only one of the risk factors for such heart ailments. However in view of our observations made in foregoing paragraphs, much discussions regarding contributive factors or direct or indirect causes leading to heart ailments is not necessary. Decisions cited in the notes submitted by learned counsel for opposite                                                                                                                (cont….12)

• 12  -

parties are based upon different sets of facts. Decision of Apex Court too was in a case where there was disclosure of diabetes mellitus by insured.

 

Yet another important fact which we notice is that the policy had  lapsed in 2018.  It is mentioned in clause 7 of  Ext.R8 that policy was revived on 8.2.2018 under a revival campaign.  While reviving, the Branch had not obtained any medical reports and DGH.  It is also mentioned that in revival quotation it is wrongly mentioned that there was no need for such requirements.  Thus according to opposite parties, policy had lapsed in 2018 and subsequently revived only on 8.2.2018, under a revival campaign. Rw1 has admitted during cross examination that in 2018 premium was paid after grace period and that in cases where policy is not renewed within grace period, health declaration is obtained for renewal.  Due to latches on the part of opposite parties, no medical reports and DGH were obtained from the complainant in this case at the time of reviving the policy. Hon’ble Supreme Court has observed in the matter of Biman Krishna bose vs. United India Insurance Co.Ltd., that upon revival a new policy comes into effect, but on old terms. Therefore at the time of revival, opposite parties were obliged to revive the policy on earlier terms which included obtaining necessary health reports and DGH from complainant. If they had waived or omitted to obtain such reports or declarations it could be only at their risks and costs. If they were to seek health report and DGH then only it would be obligatory on the part of complainant to provide health reports and DGH regarding  his health condition, which he would have done also.  

 

Thus, evidence, in particular, R8 proves that pre existing contract which was being renewed yearly,  would only be live till it  lapsed in 2018.  Its revival took place on 8.2.2018 under a revival campaign of opposite parties, which could be upon same terms and conditions of the old policy. It  was therefore, incumbent upon the part of opposite parties to obtain necessary medical reports and DGH again from the complainant, which they have not done. That being so, even if it is presumed that there was no disclosure from the side of complainant with regard to his health condition in his proposal submitted in 2012, the lapse or latches will not effect his claim made after revival.  The revival indicates that a new contract has come into existence for the conclusion of which opposite parties have not deemed it fit to obtain medical records and DGH from complainant.  That being so, claim for reimbursement made cannot be  negatived  for this reason also.

 

                                                                                                (cont….13)

 

• 13  -

 

Alternate contention of respondents that Ext.P1 is not a mediclaim policy. It is pleaded that the policy is  health insurance policy with declared benefits.  Benefits of the policy are not directly related to bill amounts spent by complainant for his treatment. It’s declared benefits are hospital cash benefit (HCB), major surgical benefit (MSB) for the 140 listed surgeries, day care procedure benefits (DCPB) for 140 listed day care procedures and other surgical benefits (OSB), for surgeries which do not come under MSB.  That DCPB will be considered under OSB subject to terms, exclusions mentioned in policy.  Opposite parties have in the alternate pleaded that if the claim were to be admitted, amount payable in total would be Rs.3,53,800/-, which could be split into three counts.  One is for day care benefits from 15.1.2020 to 17.1.2020 amounting to Rs.14,500/-.  2^nd head is for OSB for 3 days + HCB for 2 days from 20.1.2020 to 23.1.2020 totaling to Rs.23,200/-.  3^rd head is MSB for 9 days + HCB for 9 days from 12.2.2020 till 21.2.2020 amounting to Rs.3,16,100/-. 

 

          On the other hand, complainant has claimed Rs.20,607/- for hospitalization from 15.1.2020 to 17.1.2020 as DCB and major surgical benefits.  As per Ext.P6, he had claimed Rs.87,082/- towards DCB and major surgical Benefits.  As per Ext.P9, complainant has claimed Rs.20,000/- towards DCB and Rs.3,22,312/- towards Major Surgical Benefits totaling to Rs.3,42,312/-.  According to him, the policy entitles him to claim  entire amount mentioned in Exts.P3, P6 and P9, Which would be  Rs. 4,50,001/-. However, opposite parties have pleaded otherwise and  given evidence also, on the premises that claims were for benefits under DCB. Method of calculation is also given in the proof affidavit filed by RW1.  The witness has not been cross examined on this point, specifically.  Hence we hold that as per Ext.P1 policy terms and conditions, entitlement of complainant would be only for reimbursement of Rs.3,53,800/- towards his claim.  As mentioned earlier, though opposite parties could not substantiate their repudiation of the claim in it’s entirety, they have succeeded in proving the alternate plea that the complainant is only entitled for reimbursement of a portion thereof, under Ext.P1 policy, as indicated earlier by us. Evidence indicates that this amount was denied to him by opposite parties, which would certainly amounts to deficiency in service.  Facts being so, we find that complainant is entitled to receive a sum of Rs.3,53,800/- as reimbursement towards his medical expenses undergone by virtue of Ext.P1, upon revival in 2018 and thereafter, as policy was alive when the       

                                                                                                                  

  (cont…14)

 

• 14  -

 

complainant had undergone treatment.  Denial of this amount is indeed deficiency in service.  It is evident from Ext.R8 that lapse of policy and its subsequent revival as mentioned in Ext.R8 was known to opposite parties.  They are also aware that at the time of revival, there was an omission in not seeking necessary medical records and DGH from complainant.  This omission is admitted in Ext.R8.  Yet they have not mentioned this fact in their written version. This conduct on the part of opposite parties 1 to 4 is unbecoming of a responsible Officer / representative of a public sector undertaking.  They ought to have pleaded entire facts in the written version, since lapse of policy and its subsequent revival are crucial factors to consider liability of the insurance company in respect of a claim laid by insured.  Considering this aspect and also the fact that complainant was put to unnecessary trouble and mental pain owing to wrongful denial of his claim, we are of the view that the compensation sought for, by complainant amounting to Rs.25,000/- is to be awarded as such, along with litigation cost of Rs.10,000/-. Point Nos.1 to 5 are answered accordingly.                                                                                        

 

Point No.6 :

 

          In the result, complaint is allowed in part with costs upon the following terms :

 

a. Opposite parties1 to 4 is hereby directed to pay a sum of Rs.3,53,800/- to complainant with interest at the rate of 12% per annum from 3.9.2020 till the date of payment or realization whichever may be case.

 

b.  They are  also directed to pay Rs.25,000/- with interest at the rate of 12% per annum from the date of this Order, till payment or realization.

 

c.  Opposite party No.1 to 4 are directed to pay Rs.5,000/- collectively as litigation cost to complainant.

 

 

 

 

 

                                                                                                     (cont…15)

 

 

• 15  -

 

 

d.  Amount ordered as per clauses a to c above, shall be paid within a period of 45 days from the date of receipt of a copy of this order, if not, complainant shall be entitled to realize the same in accordance with the provisions of this Act.

 

           Pronounced by this Commission on this the  14^th  day of July, 2022

 

 

                                                                             Sd/-

SRI. C. SURESHKUMAR, PRESIDENT

 

                             Sd/-

SMT. ASAMOL P., MEMBER

 

                        Sd/-

SRI. AMPADY K.S., MEMBER

 

 

 

                                     

APPENDIX

Depositions :

On the side of the Complainant :

PW1         -  Abraham Jose

On the side of the Opposite Party :

DW1        -  C.D. Geroge.

Exhibits :

On the side of the Complainant :

Ext.P1      -   Policy.

Ext.P2      -  Copy of premium receipt.

Ext.P3      -  copy of claim form.

Ext.P4      -  hospital treatment form.

Ext.P5      -  copy of discharge bill.

                                                                                                          (cont....16)

• 16  -

Ext.P6      -  copy of claim form.

Ext.P7      -  hospital treatment form.

Ext.P8      -  discharge bill.

Ext.P9      -   copy of claim form.

Ext.P10    -   hospital treatment form.

Ext.P11    -  copy of discharge bill.

Ext.P12    -  copy of acknowledgement

Ext.P13    -  repudiation letter.

Ext.P14    -  legal notice issued by complainant.

Ext.P15    -  postal receipt.

Ext.P16    -  AD Card.

Ext.P16    -  reply to legal notice.

Ext.P17    -  certificate issued by Dr. T.N. Soman.

On the side of the Opposite Party :

Ext.R1     -  proposal form.

Ext.R2     -  discharge summary.

Ext.R3     -  certificate issued by Dr. Jose Chacko Periappuram.

Ext.R4    -  discharge summary.

Ext.R5    -  discharge summary.

Ext.R6    -  hospitalisation claim.

Ext.R7    -  copy of guidelines for ZMRs, DMRs, RMs & Managers NB.

Ext.R8    -  repudiation letter.

Ext.R9    -  query pertaining to the claim.

 

 

 

                                                                             Forwarded by Order,

 

 

 

                                                                          ASSISTANT REGISTRAR