Kerala

Idukki

CC/93/2018

Madhu K James - Complainant(s)

Versus

Manager Star Health alled Insurance - Opp.Party(s)

30 Aug 2019

ORDER

DATE OF FILING : 07/05/18

IN THE CONSUMER DISPUTES REDRESSAL FORUM, IDUKKI

Dated this the 30^th day of August 2019

Present :

SRI. S. GOPAKUMAR PRESIDENT

SMT.ASAMOL P. MEMBER

CC NO. 93/2018

Between

Complainant : Madhu K.James,

Kamukummattathil House,

Bethel P.O., Bethel.

(By Adv: Lissy M.M.)

And

Opposite Party : 1 . The Manager,

Star Health and Allied Insurance Company Ltd.,

Zonal Ofice 4^th Floor, Carmel Towers,

Cotton Hill P.O., Vazhuthucaud Trivandrum – 14.

(By Adv: K.Pradeepkumar)

2 . The Branch Manager,

Star Health and Allied Insurance Company Ltd.,

Branch Office 2^nd Floor, Puthenpurackal Complex,

M.C.Road Kodimatha, Kottayam 686 013.

3 . Beensukutty Francis,

Vadakedath House,

Bethel P.O., Bethel.

 

O R D E R

SRI. S. GOPAKUMAR (PRESIDENT)

 

The case of the complainant is that,

 

The complainant availed a Medi Claim policy of the opposite parties 1 and 2 through their registered agent, the third opposite party. He took this policy for the medical coverage of his parents James Devasia and Mary James by remitting an amount of Rs.5,095/- each as premium on 16/02/15 and he renewed the policy till date.

 

(Cont....2)

-2-

The complainant further averred that before availing the policy the third opposite party described all the benefits of the policy and the disease it covers and persuaded him to avail this policy. Due to the instigation of the third opposite party, the complainant happened to avail this policy on the firm belief that, it will cover all the physical ailments of his parents. At the time of filling the proposal form, the complainant disclosed health condition of his parents including the ailments of his mother such as Diabetic Mellitus, Hyper Tension and Cholesterol. The proposal form was filled by the third opposite party and the third opposite party had obtain his signature in the proposal form. The complainant renewed the policy from 2015 to till date.

 

While so, the mother of the complainant was admitted in Alphonsa Hospital, Murickassery and from there she was referred to Lakeshore Hospital, Kochi in the year 2017 due to some ailments. She was treated in the Lakeshore Hospital as inpatient and an amount of Rs.56,038/- spend there as medical expenses in addition to an amount of Rs.12,000/- was incurred in Alphonsa Hospital.

 

Immediately after the discharge from the hospital complainant lodged a Mediclaim before the opposite parties with all relevant documents. But after a long gap of several months, the opposite parties repudiated the claim on the reason that at the time of submitting the proposal the mother of the complainant suppressed the pre-existing disease at the time of inception of the policy. The complainant further averred that at the time of filling the proposal form complainant revealed all the existing disease and the third opposite party filled the proposal form and the reason for repudiating the claim was only for evade from the payment the legally entitled claim amount. Complainant further stated that at the time of availing the policy, his mother suffers only diabetic problem and it is specifically stated in the proposal form. Hence opposite parties are bound to pay the claim amount without raising any baseless reason. This act of the opposite parties in denying legally entitled policy claim is a gross deficiency in service and unfair trade practice. Against this the complainant filed this petition seeking relief such as to direct the opposite parties to pay the claim amount along with interest and further direct them to pay cost and compensation.

 

(Cont....3)

 

-3-

Upon notice opposite parties 1 and 2 entered appearance and filed detailed reply version admitting the assurance of a Senior Citizen's Red Carpet policy comments from 16/02/15 to 15/02/16 and further renewed up to 15/02/18. Opposite parties further contented that at the time of issuing the policy the terms and conditions of the policy were explained the complainant and the same was served to the complainant along with the Policy Schedule. On the basis of the proposal form of the policy the complainant has specifically declared that he was not suffered from any disease or ailment at the time of submitting the proposal form except Diabetic Mellitus, Hypertension and Cholesterol. In the proposal form the complainant further declared that if after the insurance policy is effected any particulars stated in the proposal form are found incorrect, the insurance company would incur no liability under the policy.

 

Opposite parties further contented that acceptance of proposal is bases on the information given by the proposer. Acceptance of risk is to be decided by the insurance company. If the health status of the proposer found satisfactory based on the facts in the proposal, the insurer would accept the risk and issue policy. If it is contrary, the insurer would decline the risk. In the instant case the complainant has disclosed only Diabetic Mellitus, Blood Pressure and Cholesterol in the proposal form. As a part of claim processing protocol, the company conducted investigation and collected the hospital records from Lakeshore Hospital, Ernakulam. The discharge summary of the said hospital dated 04/02/15 clearly reveals that, the patient was treated for Small Vessel Vasculitis, Recurrent Cellulitis Lt Leg, Diabetic Nephropathy, Oesophegeal Candidiasis, Urinary Bladder Mass, Diabetic Retinopathy, Right Medial Calcification.

 

The treating doctor George K. Nainan's certificate dated 09/02/18 reveals that the patient was diagnosed Diabetic Kidney Disease in the year 2015. She was evaluated and found to have Diabetic Retinopathy. The treating doctor Johny J. Kannampally's certificate dated 20/02/18 reveals that for Chronic Kidney Disease (CKD) was diagnosed and opposite parties denied the allegation that the proposal form was filled by the third opposite party and at Bethel. Opposite parties submitted that the complainant approached the opposite parties for availing a policy and the opposite parties has explained the terms and conditions

(Cont....4)

-4-

of the policy. After knowing this, the complainant has opted the Senior Citizen Red Carpet Health policy to his parents and filled and signed the proposal form and remitted the premium. Hence there is no deficiency in service or unfair trade practice on the part of the opposite parties. Opposite parties further contented that as per condition NO.5 of the policy, the policy is subject to the payment of 50% of each and every claim arising out of pre-existing diseases and 30% of each and every claim for all other claims.

 

Based on the available medical records, it is evident that this patient had listing of the above said ailments and this was willfully suppressed by the insurer in the proposal form. Hence the opposite parties repudiated the claim. Moreover intentionally suppressed these facts in the proposal form, despite there is specific question in the medical history column, the complainant had answered Diabetic Mellitus, Blood Pressure and Cholesterol only. More over, in the additional questionnaire given with the proposal form, to the specific question of whether suffering from Chronic Kidney Disease, the complainant had answered in the 'negative'. Hence the opposite parties had repudiated the claim and the decision was communicated to the complainant vide letter dated 27/03/18.

 

Opposite parties further contented that, insurance contracts are 'contract of 'uberime-fide'. The opposite parties issued the aforesaid policy on good faith based on the declaration made by the proposer/insured in the proposal form. For all the misrepresentation, fraud, false statement knowingly made by the complainant by suppressing the material facts which he alone is responsible and the company has no liability. As per condition No.9 of the policy, the company shall not be liable to make any payment under the policy in respect of any claim, if such claim is in any manner fraudulent or supported by any fraudulent means or device. If there is suppression of material facts, then the insurance company is not liable to indemnifying the insured.

 

Opposite parties further contented that as per condition No.13 of the policy, the company may cancel the policy on grounds of non- disclosure of material facts, by sending the insured 30 days registered notice. In this case also a registered notice was issued to the complainant and thus the policy No.P/181113/01/2018/007386 in respect of Mrs.Mary James was canceled with

(Cont....5)

-5-

effect from 05/05/18 due to the non disclosure of pre-existing disease and had refunded the premium of Rs.5250/- vide DD No.195941 dated 30/04/18 policy.

 

Evidence adduced by the complainant by way of proof affidavit and documents. Complainant was examined as PW1. Ext.P1 to Ext.P5 were marked. Ext.P1 is the copy of insurance policy, Ext.P2 is IP bill details of Lakeshore Hospital, Ext.P3 is the repudiation letter dated 27/03/18, Ext.P4 is the Bill Summary of Lakeshore Hospital, Ext.P5 is the Brochure of opposite parties insurance around 3 years back and was in regular treatment and follow up.

 

On the other side one Manu Mohan, Assistant Manager-claim was examined as DW1. Ext.R1 to Ext.R9 were marked. Ext.R1 is the proposal form- Senior Citizen's Red Carpet Policy, Ext.R2 is the Policy Schedule, Ext.R3 is the discharge summary of Lakeshore Hospital dated 23/12/17, Ext.R4 is the discharge card of Alphonsa Hospital dated 08/12/17, Ext.R5 is the copy of discharge summary of Lakeshore Hospital dated 21/02/15, Ext.R6 is the Medical certificate of Dr.Georgy K.Ninan certificate dated 09/02/18, Ext.R7 is the copy of repudiation letter, Ext.R8 is the letter of the opposite parties dated 26/03/18, Ext.R9 is the policy cancellation letter dated 02/05/18.

 

Heard both sides,

 

The point that arose for consideration is whether there is any deficiency in service from the part of opposite parties, and if so, for what relief the complainant is entitled to ?

 

The Point:- We have heard the counsel for both parties and have perused the documents. It is an admitted fact that from 16/02/15 onwards the parents of the complainant are insured with Senior Citizen's Red Carpet insurance policy of the opposite parties and the complainant renewed up to 15/02/18. At the time of inception of the policy complainant revealed the ailments of his mother such as Diabetic Mellitus, Hypertension and Cholesterol to the agent the third opposite party who approached him. As per the version of the complainant due to the persuasion of the third opposite party, the authorized agent of the opposite

 

(Cont....6)

-6-

parties 1 and 2, the complainant happened to avail such a policy and the proposal was duly filled by the agent himself.

 

The learned counsel for the complainant specifically pointed out that the opposite parties denied the claim of the mother of the complainant on the reason that she was willfully suppressed the pre-existing disease in the proposal form, which is the basis of contract at the time of taking the policy. The learned counsel further stated that all the diseases on their knowledge was revealed and nothing was suppressed before the agent and the agent noted Diabetic Mellitus, Hypertension and Cholesterol. Hence no question of any suppression of pre-existing disease arised, and the reason for denial put forwarded by the opposite parties only evade from paying the policy claim which is legally entitled to the mother of the complainant.

 

On the other hand the learned counsel for the opposite parties contented that the discharge summary of Lakeshore Hospital, Ernakulam dated 04/02/15, clearly reveals that the patient was treated for Small Vessel Vasculitis, Recurrent Cellulitis, Diabetic Nephropathy, Oesophegeal Candidiasis, Urinary Bladder Mass, Diabetic Retinopathy, Severe Neuropathy, Right Medical Calcification. More over the treating doctor Dr.Johny J.Kannampally's medical certificate dated 20/02/18 reveals that Chronic Kidney Disease was diagnosed around 3 years back and was on regular treatment and follow up. As the insured has willfully suppressed the pre-existing disease in the proposal form, the opposite parties repudiated the claim. Further stated that, the patient intentionally suppressed these facts in the proposal form dispute there is a specific question in the medical history column that ' is any of the person proposed for insurance suffering from (a) stroke, (b) Cancer, (c) Chronic Kidney Disease, (d) Parkinson's disease (e) Alzheimer disease etc., the complainant had answered Diabetic Mellitus, Blood Pressure and Cholesterol only. Hence willful suppression of a material fact which make the contract void at initio. As per the condition 13 of the policy the company canceled the policy on the ground of non-disclosure of material fact and a notice was issued to the insurer and refunded the premium amount Rs.5250/- vide demand draft dated 30/04/18. Hence no deficiency in service and unfair trade practice is happened on the side of the opposite parties and the complaint is liable to be dismissed with compensating cost.

(Cont....7)

-7-

We have perused the evidence on record and found that at the time of inception of proposal form on 16/02/15 (Ext.R1) the complainant disclosed the diseases such as Diabetic Mellitus, Hypertension and Cholesterol. On further perusal of the Ext.R1 proposal form it is seen that this form is filled by some one else and the complainant put his signature. There is a vast difference between the handwriting of the person who filled the proposal form and the person who signed in it. At this juncture it is very pertinent to note that the version of the complainant is quite believable that, the form is filled by none other than the third opposite party, the registered agent of the first and second opposite parties. These documents clearly shows that the Agent/MT is Beenskutty Francis, the third opposite party. Hence we are having a specific opinion that the form is filled by the third opposite party, as stated in the complaint. So, the contention in the 24^th paragraph of the version by denying the averment and further statement of the opposite parties that the complainant himself approached them to their office and availed this policy is having no legal footing and the contention itself shows that the entire version of the opposite parties cannot be believable and admissible.

 

Then regarding the reason for denial of the claim amount, it is seen that the reason put forward by the opposite parties cannot be sustainable because the diseases which stated by the opposite parties are pre-existing is an after effect of Diabetic Mellitus. It is a considered and medically accepted fact that, if any person affect disease like Diabetic Mellitus, it affect almost all the internal organs of the human body, such as Kidney, Liver, Heart etc.,. More over Diabetic Retinopathy and Diabetic Neuropathy are the after effect of Diabetic Mellitus. In this present case it is an admitted fact that the complainant disclosed the existing disease of his mother which he is having direct knowledge. Some of the disease are entered in the proposal form by the third opposite party. It cannot be treated as a suppression of any diseases.

 

We are having a further opinion that such type of policies are taken by the people only due to the persuasion and canvasing of the agent. After getting much training from the insurance companies the agent approaching the each person and enticing them by explaining the specialties of the policy with the help of brochure and by trapping each person. It is the mode of operation of the

(Cont....8)

-8-

insurance agents. At the same time the insurance company is researching how to deny the claim of each policy holder. Here also the insurance company denied the claim of the complainant on some flimsy and baseless grounds. It cannot be permissible and allowable. The averment of the opposite parties company is only to evade from the payment of claim amount legally entitled right of the complainant. This act of the opposite parties company is gross unfair trade practice and deficiency in service.

 

On the basis of the above discussion Forum is of a considered view that the denial of the claim of the complainant is with deficiency in service and unfair trade practice and hence the complaint is allowed. Opposite parties 1 and 2 are directed to pay the claim amount as per Ext.P3 along with 12% interest from the date of discharge ie 23/12/17 by deducting the premium amount of Rs.5250/- which was refunded to the complainant. If the complainant encashed the Demand Draft. Opposite parties further directed to pay Rs.5000/- as compensation and Rs.2000/- as cost to the complainant within 30 days, from the date of receipt of the copy of this order, failing which the amount shall carry 12% interest from the date of default till its realization.

 

Pronounced in the Open Forum on this the 30^th day of August, 2019.

 

Sd/-

SRI. S. GOPAKUMAR (PRESIDENT)

Sd/-

SMT. ASAMOL P. (MEMBER)

 

 

 

 

 

 

 

 

 

 

 

(Cont....9)

-9-

APPENDIX

Depositions :

On the side of the Complainant :

PW1 - Madhu K.James

On the side of the Opposite Party :

DW1 -Manu Mohan

Exhibits :

On the side of the Complainant :

Ext.P1 - The copy of insurance policy

Ext.P2 - IP bill details of Lakeshore Hospital

Ext.P3 - The repudiation letter dated 27/03/18

Ext.P4 - The Bill Summary of Lakeshore Hospital

Ext.P5 - The Brochure of opposite parties insurance around 3 years back and was

in regular treatment and follow up.

On the side of the Opposite Party :

Ext.R1 -The proposal form- Senior Citizen's Red Carpet Policy

Ext.R2 -The Policy Schedule

Ext.R3 -The discharge summary of Lakeshore Hospital dated 23/12/17

Ext.R4 -The discharge card of Alphonsa Hospital dated 08/12/17

Ext.R5 -The copy of discharge summary of Lakeshore Hospital dated 21/02/15 Ext.R6 -The Medical certificate of Dr.Georgy K.Ninan certificate dated 09/02/18 Ext.R7 -The copy of repudiation letter

Ext.R8 -The letter of the opposite parties dated 26/03/18

Ext.R9 -The policy cancellation letter dated 02/05/18.

 

Forwarded by Order,

 

SENIOR SUPERINTENDENT