Karnataka

Bangalore 4th Additional

CC/14/1410

Mr. Murali K. - Complainant(s)

Versus

Max Bupa Health Insurance Co. Ltd and Other - Opp.Party(s)

31 May 2018

ORDER

Complaint filed on: 16.08.2014

                                                      Disposed on: 31.05.2018

 

BEFORE THE IV ADDL DISTRICT

CONSUMER DISPUTES REDRESSAL FORUM, BENGALURU

 1^ST FLOOR, BMTC, B-BLOCK, TTMC BUILDING, K.H.ROAD, SHANTHINAGAR, BENGALURU – 560 027       

 

 

CC.No.1410/2014

DATED THIS THE 31^th MAY OF 2018

 

PRESENT

 

 

SRI.S.L.PATIL, PRESIDENT

SMT.N.R.ROOPA, MEMBER

 

Complainant/s: -                           

Mr.Murali.K

Aged 51 years

Flat no.1-A

Vishwamithra Enclave,

Double Road, 3^rd stage

BEML layout, Raja

Rajeshwari Nagar,

Bengaluru-560098

 

By Adv.Sri.S.Samartha  

 

V/s

Opposite party/s

Respondent/s:-

 

1. Max Bupa Health

Insurance Co. Ltd.,

First Floor, Vaishnavi

Silicon Terrace, 30/1,

Hosur Main Road,

Adugodi, Opposite Prestige, Bengaluru-560095

 

Rep. by –

Head, Operations Team

 

2. Max Bupa Health

Insurance co. ltd.,

B-1/1-2, Mohan

Co-operative Industrial

Estate, Mathura Road,

New Delhi-110044

 

Rep. by -

Head, Customer services

 

By Adv.Sri.H.N.Keshava Prashanth

PRESIDENT: SRI.S.L.PATIL

 

 

            This complaint is filed by the Complainant against the Opposite party no.1 & 2 (herein after referred as Op.no.1 & 2 or Ops) seeking issuance of direction to pay Rs.75,706/- towards the medical expenses incurred with interest 18% p.a. Further direct them to pay damages of Rs.50,000/- for mental agony, Rs.1 lakh for loss of business with legal charges and Rs.20,000/-  towards medical expenses incurred due to subsequent consultations with the doctors and to grant such other reliefs deem fit for which the Complainant is entitled to.

 

          2. The brief facts of the case of the Complainant are that, after the representations made by the Op regarding the excellent services provided and other assurances, he took health insurance vide policy no.30092399201402. He has been insured under the insurance cover of the Op and has been renewing his insurance policy annually since the past few years. The recent renewal was made last year and the said policy was valid till 06.04.14. It is the case of the Complainant that, during the subsistence of the health insurance policy i.e. during February 2014, the wife of the Complainant was diagnosed with Fibroid Uterus and advised surgery. After preliminary medical checks and advice, she was admitted to Venlakh hospital for surgery on 10.03.14 and after surgery was completed, the Complainant’s wife was discharged on 12.03.14. After the said discharge from the hospital and after obtaining the complete details of the surgery and the medical bills and prescriptions, the Complainant has made an insurance claim with the Op vide his letter dtd.26.03.14. The said claim was for Rs.75,706/- and as per the insurance policy requirements, the Complainant had also enclosed all the necessary papers and documents for verification. The Complainant further submits that, however, to his utter disbelief, the Complainant received a letter dtd.12.04.14 from the insurance company rejecting his claim under some vague pretext that there was non-disclosure of material fact as the wife of the Complainant had hypertension from the last 4 years. The Complainant who was taken aback by this response from the Op, contacted it and asked for a valid explanation for rejecting his claim. However, the Op brushed aside his genuine and legitimate concerns by giving some untenable excuses. The Complainant further submits that, it is pertinent to mention that the said clause under which Op rejected the claim i.e. clause 5(g) 3(ii) stipulates that in the event the insured person has not disclosed any material fact or has misrepresented, then the insurance company may terminate the policy by sending 30 days prior written notice. However, there has been absolutely no non-disclosing of material fact or any misrepresentation from the Complainant. Further, the reason stated by the Op that the Complainant’s wife was a known case of hypertension has absolutely no bearing on the health complication i.e. Fibroid Uterus which the Complainant’s wife was diagnosed with. The Complainant further submits that, though the reason for rejecting the insurance claim appeared both illogical and untenable, the Complainant had previously in the year 2012 had sought to claim insurance for his wife for some related medical problem and had clearly mentioned that his wife had hypertension which was also reflected in the doctor’s opinion of A.V.Nursing home and hospital. Further, the Complainant has had to spend all his time, efforts and energy in repeatedly meeting the authorized personnel of the Op and further trying to explain to them the situation and also taking several medical opinions. This unjust harassment and disallowance of the claim of the Complainant clearly constitutes deficiency of service. In this context, he issued legal notice dtd.13.05.14 but no reply from Op. Hence prays to allow the complaint.

 

3. On receipt of the notice, Op.no.1 & 2 did appear and filed version.  The sum and substance of the version of the Ops are that, there has been no negligence or deficiency of service whatsoever, on the part of Ops in dealing with the concerned policy. The Policy of insurance is the evidence of the terms of the agreement between the insured and insurer. The promise of the insurer to indemnify the assured is subject to the disclosures made in the policy proposal form filled by the insured and the terms & conditions and exceptions of the policy.  Ops further submits that, a policy of life insurance is a policy of utmost good faith. Upon receiving a proposal form from the Complainant and declaration submitted by him, the Ops had issued the said insurance policy. The liability of Ops is subject to terms & conditions of the policy issued and date of coverage given in the policy. Ops further submit that, they have received a claim for reimbursement of the medical expenses incurred by the Complainant on 29.03.14, requesting for reimbursement of the medical expenses incurred towards the treatment of his wife taken at the Venlakh hospital, Bengaluru during 10.03.14 to 12.03.14. Thereafter, an investigation was carried out in order to ascertain the veracity of the claim. On perusal of the documents submitted by the Complainant and the documents collected from the hospital at the time of investigation, it was revealed that the patient is suffering from hypertension since 4 years. The Complainant in her statement says that she has been suffering from hypertension since 1-2 years. However, the anesthesia record maintained by the hospital mentions that the she had been taking medicines for hypertension since 4 years. However, the Complainant had not disclosed this at the time of taking the policy. In the proposal form for insurance, insured had answered the ‘Medical History’ questions as ‘NO’. Ops further submit that, the proposal to insure the Complainant and his family was accepted based on the answers, statements and declarations made by the insured in the proposal form. As per clause 5 of the general selection: section III of the proposal form, it is the mandatory duty of the insured to disclose all the material facts. Therefore, the claim of the Complainant was denied for non-disclosure of material facts under clause 5(g) (3)(ii) of the policy terms & conditions. The Complainant further submits that, rejection on the basis on non-disclosure of material facts means that the claim has been rejected because from the claim documents, it has been discovered that the Complainant did not disclose the whole truth and true medical history at the time of filling the proposal form for insurance policy. The proposal form is the backbone of the insurance policy because only on the basis of information disclosed therein, the insurance company evaluates the risks involved in insuring the proposer and decides whether or not the proposer should be insured and if the proposer should be insured, then on what conditions and what exclusions and premium should be charged considering the proposer’s medical history. By not disclosing the true medical history, the Complainant deprived the Ops from fair underwriting of the policy and fooled the insurance company just to get medical insurance by hook or by crook. Had the insurance company known about the hypertension, then either the policy would not have been issued at all, or it would have been issued only after imposing certain exclusions. Even the premium would have been accordingly decided. When the basis of the policy itself is false, the Complainant cannot seek cover under it and take advantage of his own wrong. Hence on these grounds and other grounds prays for dismissal of the complaint.

         

          4. The Complainant to substantiate his case filed affidavit evidence and got marked the documents as Ex-A1 to A10. The Chief Manager - legal of Op.no.1 filed affidavit evidence and got marked the documents as Ex-B1 to B6. Written arguments filed by Complainant only. Heard both side.

  

5. The points that arise for our consideration are:

1. Whether the Complainant proves deficiency of service on the part of Ops, if so, whether he entitled for the relief sought for ?    
2. What order ?

 

           

 

6.  Our answers to the above points are as under:

 

Point no.1: In the Affirmative.  

Point no.2: As per the final order for the following

 

REASONS

 

          7. Point no.1:  We have briefly stated the contents of the complaint as well as the version filed by the Ops. It is not in dispute that, Complainant, to take health insurance cover to himself and his family, had approached the Op and after the representations made by the Op regarding the excellent services provided and other assurances, decided to take the health insurance cover and was alloted the policy no.30092399201402. The Complainant has been insured under the insurance cover of the Op and has been renewing his insurance policy annually since the past few years. The recent renewal was made last year and the said policy was valid till 06.04.14 is not in dispute. It is also not in dispute that, during the subsistence of the health insurance policy i.e. during February 2014, the wife of the Complainant was diagnosed with Fibroid Uterus and advised surgery. After preliminary medical checks and advice, she was admitted to Venlakh hospital for surgery on 10.03.14 and after surgery was completed, the Complainant’s wife was discharged on 12.03.14. This fact is also not in dispute. The disputes starts after submitting the medical claim which can be seen on going through para 6 of the complaint, wherein it is stated that, after the said discharge from the hospital and after obtaining the complete details of the surgery and the medical bills and prescriptions, the Complainant has made an insurance claim with the Op vide his letter dtd.26.03.14. The said claim was for Rs.75,706/- and as per the insurance policy requirements, he had also enclosed all the necessary papers and documents for verification. However, the Complainant received a letter dtd.12.04.14 from the insurance company rejecting his claim under some vague pretext that there was non-disclosure of material fact, as the wife of the Complainant had hypertension from the last 4 years. The Complainant who was taken aback by this response from the Op, contacted it and asked for a valid explanation for rejecting his claim. However, the Op has given some untenable excuses. According to the case of the Op, the claim has been dis-allowed by invoking clause 5(g) 3(ii), which stipulates that in the event, the insured person has not disclosed any material fact or has misrepresented, then the insurance company may terminate the policy by sending 30 days prior written notice.

 

           8. To falsify the contention taken by the Ops, the learned counsel for the Complainant submits that, the claim repudiated by Ops is illegal, showing the reasons that, wife of the Complainant was suffering from hypertension which cannot be termed as material disease. Further submits that, the insurance company cannot deny such claims on fringe grounds as the insurance company is also bound by terms & conditions. In this context, he placed reliance on the following decisions (in the memo of citations dtd.23.03.17, it is stated that, these citations are furnished by advocate for the Op, but it ought to have been advocate for the Complainant):

1. LIC India v. G.M.Channabasemma, AIR 1991 SC 392

2. LIC India and Ors v. Smt.Asha Goel and, Anr AIR 2001 SC 549

3. Bajaj Allianz General insurance company ltd., vs. Vals Jose, IV (2012) CPJ 839 (NC)

4. Pushp Lata v. LIC India, II (2012) CPJ 250 (NC)

5. LIC India & Anr V.Sudesh, II (2012) CPJ 65 (NC)

6. V.Perumalsamy v. LIC India & Anr, I (2014) CPJ 222 (NC)

 

9. We placed reliance on the said decisions. In addition to these decisions, this forum also come across with the following decisions in respect of hypertension, which reads thus:

1. 2008 CTJ 396 (CP) (SCDRC) in the case of LIC of India and Anr., v. Sukhpal Kaur, wherein it is held that:

Insurance – deficiency of service – Consumer Protection Act, 1986 -  Section 2(1)(g) –section 2(1)(o) – Insured died leaving behind a life policy of an amount of Rs.5 lakhs – repudiation of the claim lodged by his wife taking a plea that he died of kidney failure within 2 years and 5 months of taking the policy, was a chronic alcoholic and suffered from hypertension for the last 10 years – District Forum allowed her complaint directing for payment of the claim amount of Rs.5 lakhs with 6% interest – appeal – only the suppression of material facts could entitle the appellants to repudiate the claim – hypertension cannot be termed a material disease – held, consumption of liquor and hypertension could not be termed as material facts leading to the repudiation of the claim – appeal dismissed.

In the said decision at para 6 to 9 it is held that:

(6) Dhum Singh was admitted in V.K.Neurocare hospital, Chambal Hospital road, Hissar and he was discharged on the same date. As per this certification, the information was given by the respondent who was the wife of Dhum Singh. As per this certificate Dhum Singh was suffering from hypertension for the last 10 years. Hypertension cannot be termed as a material disease. If it had been a disease, he would not have survived for 10 years. It was held by the Hon’ble Supreme Court in the judgment reported in “Biman Krishna Bose vs. United India Insurance co., ltd., and Anr., 2001 CTJ 716 (SC) (CP) = 111 (2001) CPJ 10 (SC)” that insurance companies should not act arbitrarily. The Hon’ble Supreme Court was pleased to observe as under:

“where an insurance company under the provisions of the Act having assumed monopoly in the business of general insurance in the country and thus acquired the trappings of the ‘State’ being other authorities under Article 12 of the Constitution, it requires to satisfy the requirement of reasonableness and fairness while dealing with the customers. Even in an area of contractual relations, the State and its instrumentalities are enjoined with the obligations to act with fairness and, in doing so, can take in to consideration only the relevant materials. They must not take any irrelevant and extraneous consideration while arriving to a decision. Arbitrariness should not appear in their actions or decisions”.

(7) It was also mentioned that the deceased was alcoholic for the last 6 years and he used to consume half bottle of liquor daily. This information was given by the wife of Dhum Singh, deceased. The consumption of liquor is also not a disease. Society as a whole with few exceptions has become accustomed to take liquor. Consumption of liquor to the extent of half bottle a day appears to be exaggeration. This information was allegedly told to the hospital authorities by the respondent. If this had been a reality, Dhum Singh could have been consumed by the liquor itself sooner than 6 years. It appears to be only a vague allegation that half bottle of liquor was consumed by the deceased everyday for the last 6 years. No record has been produced to that effect nor it can be believed if the wife was certain about this factual position. It was held by this Commission in First Appeal no.1585/2006 titled as “Branch Manager, LIC, unit no.2, Hall Bazar, Amritsar and another v. Rahul Sehgal” decided on 20.12.07 as under:-

“11. The learned counsel for the appellants submit that this medical record has proved that Rohit Sehgal was alcoholic for the last 15 years, and therefore, this habit of the insured led to the disease and had become a cause of his death.”

“12.This submission has been considered. It is a farfetched argument. Taking liquor is not a material fct. Moreover, taking liquor is not a disease. Almost everybody takes liquor, with few exceptions. Again, it varies whether one takes liquor in larger quantity or takes only small dose like medicine; whether one takes regularly or occasionally. This report does not clarify these details. If consumption of liquor was a disease, the insured would not have survived for 15 years. He would have died even prior to filling of revival form. Therefore, taking alcohol was not a material fact, the suppression of which can entitle the appellants to repudiate the claim.

8. No-doubt the settled law is that the insured is bound to disclose the material facts to the insurance company at the time of filling up the proposal form and the insurance companies are entitled to take the benefit of Secion 45 of the Insurance Act. In this case, the proposal form was filled on 04.10.01 while the insured had died on 18.01.04 i.e. more than 2 years after the filling of the proposal form. In such circumstances, as per the law laid down by the Hon’ble Supreme Court in the judgment reported as “Mithoolal Nyayak vs. LIC of India AIR 1962 Supreme Court 814” only the suppression of material facts can entitle the appellants to repudiate the claim. The consumption of liquor by Dhum Singh and his disease of hypertension are not material facts, the suppression of which will entitle the appellants to repudiate the claim.

9. In view of discussion held above, we find no merit in the present appeal and the same is dismissed. However, there will be no order as to costs.

 

2.  III (2017) CPJ 553 (NC) in the case of Arunkumar vs. New India Assurance co., ltd.,

Consumer Protection Act, 1986 – Sections 2(1)(g), 14(1)(d), 21(b) – insurance (mediclaim) – degenerative joint disease in both knees – treatment taken – medical reimbursement – suppression of pre-existing disease alleged – claim repudiated – deficiency of service – District Forum allowed complaint – State Commission allowed appeal – hence revision – opinion given by panel doctors is based on presumption only that Complainant would have been suffering from degenerative joint disease for the last 4 to 5 years atleast – said presumption has not been supported by any medical evidence or record – Complainant has been taking the insurance policy since the year 1997 -  It was the bound duty of insurance company to have verified information given in proposal form by obtaining suitable expert opinion – However, when claims are filed, minute scrutiny starts at that stage and claims are repudiated, even for minor lapses on part of proposer – Complainant had difficulty in waling for a long time and history of borderline hyper tension, but not on any medication – non-disclosure of such conditions in proposal from cannot be blown out of proportion, so as to disentitle Complainant from claim amount from insurance company – repudiation not justified.

 

3. III (2014) CPJ 340 (NC): Op did not produce any evidence to prove that which medication and how long the Complainant was taking for diabetes/hypertension- held – concealment not established – repudiation not justified.

 

         10. In the light of the decisions cited by the learned counsel for the Complainant and also by this forum, the claim repudiated by Ops by invoking clause 5g 3ii under Ex-B6 i.e. claim denial letter, is illegal. Hence, the Complainant is entitled for the reimbursement of the said claim amount of Rs.75,706/- as shown in claim form Ex-B2. In this context, we are of the opinion that, if we direct the Ops to pay the said amount to the Complainant with interest at 6% p.a. from the date of payment of the said amount to the hospital till realization, we hope ends of justice would met sufficiently. With regard to mental agony, personal inconvenience, loss of business etc., are concerned, we direct Ops to pay Rs.10,000/- as compensation to the Complainant. Further, we fixed cost of litigation of Rs.5,000/-. Accordingly we answered the point no.1 in the affirmative.

 

          11. Point no.2: In the result, we passed the following:

ORDER

 

          The complaint filed by the Complainant is allowed.  

 

          2. We direct Op.no.1 & 2 jointly and severally liable to pay medical claim amount of Rs.75,706/- as shown in claim form Ex-B2 to the Complainant with interest at the rate of 6% p.a. from the date of payment of the said amount to the hospital till its realization.

 

3. Ops are also directed to pay compensation of Rs.10,000/- and cost of litigation of Rs.5,000/- to the Complainant.

 

4. We also direct Ops to release the said amount within six weeks from the date of receipt of this order, failing which the Complainant is at liberty to have the redress as per law.

 

          Supply free copy of this order to both the parties.

 

          (Dictated to the Stenographer, got it transcribed, typed by her/him and corrected by me, then pronounced in the Open Forum on 31^th May 2018).

 

 

 

 

(ROOPA.N.R)     MEMBER

(S.L.PATIL)  PRESIDENT

                                                                        

1. Witness examined on behalf of the complainant/s by way of affidavit:

 

Sri.Murali.K, who being the complainant was examined. 

 

Copies of Documents produced on behalf of Complainant/s:

 

Ex-A1	Insurance certificate from 07.04.14 to 06.04.15
Ex-A2	Premium receipt dtd.07.04.14
Ex-A3	Customer information sheet
Ex-A4	Premium receipt dtd.31.03.12
Ex-A5	Letter dtd.26.03.14 by the Complainant for claim of insurance  to Opposite parties along with claim form-Part A, Part B, cash bill, discharge summary
Ex-A6	Letter of repudiation dtd.12.04.14
Ex-A7	Legal notice dtd.Nil
Ex-A8	RPAD Acknowledgement
Ex-A9	Member reimbursement statement dtd.17.07.12
Ex-A10	Discharge summary dtd.17.05.12 from A.V.Hospital

 

2. Witness examined on behalf of the Opposite party/s Respondent/s by way of affidavit:

 

Sri.Sumeet Bajaj, who being the Chief Manager – Legal of Op.no.1 was examined.

 

Copies of Documents produced on behalf of Opposite party/s

 

Ex-B1	Proposal form
Ex-B2	Claim form and documents
Ex-B3	Investigation report
Ex-B4	Medical documents
Ex-B5	Statement given by the Complainant wife
Ex-B6	Claim denial letter

 

 

 

 

(ROOPA.N.R)     MEMBER

(S.L.PATIL)  PRESIDENT