DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KOZHIKODE
PRESENT : Sri. P.C. PAULACHEN, M.Com, LLB : PRESIDENT
Smt. PRIYA.S, BAL, LLB, MBA (HRM) : MEMBER
Sri.V. BALAKRISHNAN, M Tech, MBA, LL.B, FIE: MEMBER
Wednesday the 18th day of January 2023
C.C. 329/2018
Complainant
Vahida,
D/o Sayed,
Kizhuparambath House, Karikkamkulam,
Vengeri Village, Karaparamba P.O,
Kozhikode – 673010.
(By Adv. Sri. Sajir. P. K)
Opposite Parties
- Medi Assist Insurance TPA Pvt. Ltd.,
Tower D, 4th Floor, IBC Knowledge park,
4/1, Bannerghatta Road, Bangalore – 560029.
- United India Insurance Co. Ltd.,
Rep.by its Manager, Mavoor Road Jn.,
Kozhikode – 1.
- Vijaya Bank Rep. by its Manager,
Nadakkavu Branch, Kozhikode – 6.
(OP2 – By Adv. Sri. T. V. Hari)
ORDER
By Sri. P.C. PAULACHEN – PRESIDENT.
This is a complaint filed under Section 12 of the Consumer Protection Act, 1986.
2. The case of the complainant, in brief, is as follows:
The complainant had availed a Health Care Medi claim Insurance Policy from the second opposite party. The policy covers the complainant, her husband and daughter. The policy is valid till 01/03/2019. The date of inception of the policy is 06/02/2016 and was renewed from time to time. The limit of coverage was Rs. 50,000/-. On 02/07/2018, the husband of the complainant Sri. Said Ismail was admitted in MEITHRA Hospital, Kozhikode due to sudden chest pain. He had undergone an operation and was discharged on 05/07/2018. This fact was intimated to the second opposite party. A sum of Rs. 2,05,510/- was paid in the hospital towards medical expenses. The complainant preferred a claim with relevant documents to the Medi Assist Insurance TPA Private Ltd Kochi on 12/07/2018 which was said to be transferred to Banglore branch. There was no reply evenafter repeated reminders and hence she contacted Sri. Ratheesh, a staff member of Medi Assist Banglore Office over mobile phone. She has given an oral reply that additional details called for from the third opposite party had not been received and therefore the claim was closed. On contacting the third opposite party, it was informed that the details called for had been sent by email on 19/07/2018 and this fact was informed to the first opposite party on 25/09/2018. Still now the claim is pending. Hence the complaint for getting medical claim with interest and damages.
3. The first and third opposite parties were set ex-parte. The second opposite party filed written version.
4. According to the second opposite party, the medi claim of the complainant was not processed as she failed to supply the necessary information sought from her. The first opposite party requires previous year policy copies from the date of inception. But the complainant had not supplied/replied for the same and hence the claim is kept pending. Without necessary details, the claim cannot be processed further. The sum insured is Rs. 50,000/-. There is no deficiency of service on the part of the second opposite party. The complainant is to be directed to co-operate and supply the necessary details for processing the claim. With the above contentions, the second opposite party prays for dismissal of the complaint.
5. The points that arise for determination in this complaint are;
(1). Whether there was any deficiency of service on the part of the opposite parties?
(2). Reliefs and costs.
6. Evidence consists of the oral evidence of PW1 and Exts A1 to A11 on the side of the complainant. No evidence was let in by the opposite parties.
7. Heard. The complainant filed brief argument note.
8. Point No 1 : The complainant has approached this Commission with the grievance that the claim put in by her in connection with the treatment of her husband was not sanctioned by the second opposite party and thereby there was deficiency of service on the part of the opposite parties.
9. The power of attorney holder of the complainant was examined as PW1, who has filed proof affidavit and deposed in terms of the averments in the complaint. Exts A1 to A3 are the copies of the policy, Ext A4 is the copy of the discharge summary, Ext A5 is the copy of the inpatient bill, Ext A6 is the copy of the pharmacy bill, Ext A7 is the copy of the medical certificate, Ext A8 is the copy of the claim letter with filled up reimbursement form, Ext A9 is the copy of the notice dated 13/08/2018, Ext A10 is the copy of the notice dated 29/05/2019 and Ext A11 is the deed of power of attorney.
10. The first and third opposite parties chose to remain absent and they did not participate in the proceedings. The case advanced by the contesting second opposite party in the written version is that the claim is not processed for want of necessary details.
11. There are some admitted facts in this case. That the complainant is the holder of V Arogya (Group Health Insurance Scheme) policy of the second opposite party is admitted. The policy covers the complainant, her husband and daughter. The policy commenced on 06/02/2016 and was renewed periodically. Ext A1 is the copy of the policy for the period from 06/02/2016 to 05/02/2017, Ext A2 is the policy for the period from 20/02/2017 to 19/08/2018 and Ext A3 is the copy of the policy for the period from 02/03/2018 to 01/03/2019. The limit of coverage as per the policy was Rs. 50,000/-. On 02/07/2018 the husband of the complainant Sri. Said Ismail was treated in the MEITHRA Hospital, Kozhikode. He was admitted on 02/07/2018 and discharged on 05/07/2018. He was admitted with complaints of chest pain and undergone Coronary angioplasty on 03/07/2018. Ext A4 is the copy of the discharge summary. Rs. 2,05,510/- was the hospitalisation and treatment expenses. Claim was preferred by the complainant. But it was not sanctioned. There is no serious dispute on the above aspects.
12. The reason stated by the second opposite party for not sanctioning the claim is that the complainant failed to furnish copies of the previous year policy from the date of inception. But this is denied by the complainant who has asserted that all the necessary documents were furnished to the second opposite party. Moreover, it may be noted that the policy copies are the computer generated documents and are available with the second opposite party. So there is no justification for not processing the claim for that reason. The act of the second opposite party in not processing the claim amounts to deficiency of service.
13. At the time of evidence, the second opposite party has set up a new case that the husband of the complainant was having pre –existing heart disease. But such a contention does not find a place in the written version. In Ext A4 discharge summary the previous history is shown as Coronary artery disease - 3 vessels disease - normal left ventricular systolic function, sinus rhythm, Systemic hypertension – 8 years - Diabetes meletus – type 2 - 8years – on oral hypoglycaemic agents, Dyslipidemia – 8 years. The second opposite party has no case in the written version that the complainant had suppressed pre-existing disease and that was the reason for not honouring the claim.
14. It is well settled that the contract of insurance is a contract uberimmae fidei and every material fact must be disclosed. In Modern Insulators Ltd. Vs. Oriental Insurance Co., Ltd. (2000)2 Supreme Court Cases 734, the Hon’ble Supreme Court has held that the non-disclosure of the terms and conditions is violation of utmost good faith which is the base of insurance contract. In paragraph 8 of the aforesaid decision, it has been held as follows:
“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 nondisclosure of the facts which the parties know. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose all material facts in their knowledge since obligation of good faith applies to both equally”.
15. The Hon’ble Apex Court in 2021 ( 0 ) Supreme (SC) 779- (Manmohan Nanda V/s United India Insurance Company Limited) has observed as follows; (paragraph 52)
“On a consideration of the aforesaid judgments, the following principles would emerge:
(!). There is a duty or obligation of disclosure by the insured regarding any material fact at the time of making the proposal. What constitutes a material fact would depend upon the nature of the insurance policy to be taken, the risk to be covered, as well as the queries that are raised in the proposal form.
(!!). What may be a material fact in a case would also depend upon the health and medical condition of the proposer.
(!!!). If specific queries are made in a proposal form then it is expected that specific answers are given by the insured who is bound by the duty to disclose all material facts.
(!!!!). If any query or column in a proposal form is left blank then the insurance company must ask the insured to fill it up. If in spite of any column being left blank, the insurance company accepts the premium and issues a policy, it cannot at a later stage, when a claim is made under the policy, say that there was a suppression or non-disclosure of a material fact, and seek to repudiate the claim.
(v). The insurance company has the right to seek details regarding medical condition, if any, of the proposed by getting the proposer examined by one of its empanelled doctors. If, on the consideration of the medical report, the insurance company is satisfied about the medical condition of the proposer and that there is no risk of pre-existing illness, and on such satisfaction it has issued the policy, it cannot thereafter, contend that there was a possible preexisting illness or sickness which has led to the claim being made by the insured and for that reason repudiate the claim.
(vi). The insurer must be able to assess the likely risks that may arise from the status of health and existing disease, if any, disclosed by the insured in the proposal form before issuing the insurance policy. Once the policy has been issued after assessing the medical condition of the insured, the insurer cannot repudiate the claim by citing an existing medical condition which was disclosed by the insured in the proposal form, which condition has led to a particular risk in respect of which the claim has been made by the insured.
(vii). In other words, a prudent insurer has to gauge the possible risk that the policy would have to cover and accordingly decide to either accept the proposal form and issue a policy or decline to do so. Such an exercise is dependent on the queries made in the proposal form and the answer to the said queries given by the proposer.”
16. In this context, it is worthwhile to have a glance at the decision of the Hon’ble National Consumer Disputes Redressal Commission in Arum Kumar vs. New India Assurance Company Ltd., reported in III (2017) (CPJ) 553 (NC) wherein it has been held as follows: “It is not denied that the complainant has been taking the insurance policy since the year 1997. It was the bound duty of the Insurance Company to have verified the information given in the proposal form by obtaining the suitable expert opinion. In case certain column in the proposal form were left blank, it was obligatory on the Insurance Company to ask him to fill the required information, before taking decision to issue the insurance policy. It is a matter of grave concern that the Insurance Companies. Whether in the public sector or the private sector, do not make any effort to examine the proposal properly or get the necessary verification done, at the time of issuing the policies in question. However, when the claims are filed, minute scrutiny starts at that stage and the claims are repudiated, even for minor lapses on the part of the proposer. In the present case, the discharge summary of Sitaram Bharatiya Hospital stated that the complainant had difficulty in walking for a long time and history of borderline hypertension, but not on any medication. The District Forum had rightly observed that non-disclosure of such conditions in the proposal form cannot be blown out of proportion, so as to disentitle the complainant from the claim amount from the Insurance Company. We have no reason to differ with the conclusion arrived at by the State Commission, because the conditions so mentioned in the report of the hospital, do not imply that the complainant was suffering from any serious disease. It is held, therefore, that the claim has been wrongly repudiated by the Insurance Company on the ground of non-disclosure of information about the health conditions in the proposal form”.
17. In the instant case, as we have already stated, the second opposite party has no case in the written version that the husband of the complainant was having any pre-existing disease. It is a new case tried to be set up at the time of evidence. The second opposite party has not produced the proposal form, if any, before this Commission to know whether there was any non-disclosure of the health condition by the complainant.
18. Further in paragraph 69 of the aforesaid decision it has been held by the Hon’ble Apex Court that “The object of seeking a medi claim policy is to seek indemnification in respect of a sudden illness or sickness which is not expected or imminent and which may occur overseas. If the insured suffers a sudden sickness or ailment which is not expressly excluded under the policy, a duty is cast on the insurer to indemnify the appellant for the expenses incurred thereunder”.
19. From the above discussion, what emerges is that there was no justification for not allowing the claim put in by the complainant. The act of the second opposite party in non-sanctioning the claim and denying the claim without valid reason amounts to deficiency of service. The request made by the complainant for the insured sum of Rs. 50,000/- is to be honoured by the second opposite party insurance company. Undoubtedly, the act of the second opposite party has resulted in mental agony and hardship to the complainant. She is entitled to be compensated adequately. Considering the entire facts and circumstances, we are of the view that a sum of Rs. 5000/- will be reasonable compensation in this case. The Complainant is also entitled to get Rs. 3,500/- as cost of proceedings.
20. Point No.2: In the light of the finding on the above point, the complaint is disposed of as follows;
a) CC 329/2018 is allowed in part.
b) The second opposite party is hereby directed to pay the complainant the claim amount of Rs. 50,000/- with interest at the rate of 6% per annum from the date of the complaint ie 26/11/2018 till actual payment.
c) The second opposite party is directed to pay a sum of Rs. 5,000/- (Rupees five thousand only) to the complainant as compensation for the mental agony and hardship suffered.
d) The second opposite party is directed to pay a sum of Rs. 3,500/- (Rupees Three thousand five hundred only) as cost of the proceedings to the complainant.
e) The order shall be complied with within 30 days of the receipt of copy of this order.
Pronounced in open Commission on this, the 18th day of January,2023.
Date of Filing: 26/11/2018.
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PRESIDENT
Sd/- MEMBER
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MEMBER
APPENDIX
Exhibits for the Complainant :
Ext. A1 – Copy of the policy.
Ext. A2 – Copy of the policy.
Ext. A3 – Copy of the policy.
Ext. A4 – Copy of the discharge summary.
Ext. A5 – Copy of the inpatient bill.
Ext. A6 – Copy of the pharmacy bill.
Ext. A7 – Copy of the medical certificate.
Ext. A8 – Copy of the claim letter with filled up reimbursement form.
Ext. A9 – Copy of the notice dated 13/08/2018.
Ext. A10 – Copy of the notice dated 29/05/2019.
Ext. A11 – Deed of power of attorney.
Exhibits for the Opposite Party
Nil.
Witnesses for the Complainant
PW1 – S. Ismail.
Witnesses for the opposite parties
Nil.
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PRESIDENT
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MEMBER
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MEMBER
Forwarded/By Order
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Assistant Registrar
