IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KOTTAYAM

Dated, the 30^th day of July, 2024

Present: Sri. Manulal V.S. President

  Smt. Bindhu R.  Member

Sri. K.M. Anto, Member

C C No. 330/2023 (Filed on 30.09.2023)

O R D E R

Sri. Manulal V.S. President

The complaint is filed under Section 35 of the Consumer Protection Act 2019.

In 2020, the complainant took a general insurance policy from the 2^nd opposite party as instructed by the manager of the 2^nd opposite party. The complainant renewed the said policy on 13.08.2021. The complainant, his wife, Ancy Mathew and their two daughters are the insured persons under the policy. Neema Tresa Mathew, who is the daughter of the complainant, was admitted to the SH Medical Centre Kottayam and had surgery on 16.12.2021, and was discharged from the hospital on 18.12.2021. Though the complainant submitted a claim for the reimbursement of the treatment expense along with all the documents, even after two years, the opposite party did not honor the claim. Hence, this complaint is filed by the complainant praying for an order to direct the opposite parties to pay ₹ 1,62,610/- (Rupees one lakh sixty two thousand six hundred and ten only) along with a compensation of ₹ 1,50,000/- (Rupees one lakh fifty thousand only) and ₹ 20,000/- (Rupees twenty thousand only) as the cost of this litigation.

Upon notice from this commission opposite parties appeared before the Commission and filed separate versions.

The first opposite party filed version contending as follows:

The first opposite party is a third-party administrator registered under IRDAI and the same is an independent entity that has not issued any such insurance policy to the complainant. The 1^st opposite party is entrusted with the responsibility by the insurance companies to process medical claims on behalf of insurance companies in accordance with the claims and conditions of the Insurance Policy. The role of the third-party administrator is to coordinate between the insurer and the hospital for the claim settlement process to check all the bills and documents submitted by the client and cross-check all details before approving a settlement. As such, there is no involvement with regard to the decision of settlements of claims, either on behalf of insurer or on its own behalf. The first opposite party has no discretionary power to take a decision to decline or settlement. Either accepting or rejecting the claim is the right of the insurance company and note the first opposite party. The first opposite party, as a service provider to the insurance companies only is bound to process claims taking into consideration the terms and conditions of the policy and the onus lies on the insurer for settlement or denial of claims. There is no relation between the 1^st opposite party and the complainant.  The complainant is not a consumer of the 1^st opposite party.

The complainant had paid the premium of insurance to the third opposite party. Neither the complainant has purchased the alleged insurance policy from the 1^st opposite party nor the 1^st opposite party issued any such alleged Health Insurance Policy to the complainant. There is no Nexus or privity of contract between the 1^st opposite party and the 3^rd opposite party. No cause of action arises in favour of the complainant against the 1^st opposite party and there is no deficiency in service on the part of the 1^st opposite party.

Version of the second opposite party is as follows:

The complainant availed the Insurance Policy from the 3^rd opposite party, and the 2^nd opposite party has no connection with it.  If the complainant has availed a General Insurance Policy, it is by his own will. The 2^nd opposite party is unaware of any averments regarding the complainant's claim with the insurance company. The 2^nd opposite party and the 3^rd opposite party are separate legal entities. The 2^nd opposite party is engaged in banking only and does not issue any insurance products. The 2^nd opposite party has not issued any Insurance Policy and has not repudiated any claim of the complainant.

The complainant had availed SBI General's Arogya Plus Policy from the 3^rd opposite party at his own will by paying proper premium to the third opposite party. After the treatment, the claim was submitted by the complainant to the third opposite party. Hence, the 2^nd opposite party is not liable for the rejection of the insurance claim by the first and third opposite parties.  As the complainant has not purchased any goods from the 2^nd opposite party by paying consideration, the trader-consumer relationship does not exist between the complainant and the 2^nd opposite party. There is no deficiency in service on the part of the 2^nd opposite party.

The third opposite party filed version  contending as follows:

The complainant has taken a Health Insurance Policy, namely the Arogya Plus Policy, from the 3^rd opposite party for the period from 13.08.2021 to 12.08.2022, subject to the terms and conditions of the policy. The policy was a renewed policy and the first inception of the policy was on 13.08.2020. A claim was lodged in the policy alleging hospitalization of insured Neema Tressa Mathew at SH Medical Centre for the period from 16.12.2021 to 18.12.2021. Where the patient was diagnosed with Chronic Adenotonsillitis, Septal Spur LT, Concha BullosaLt, Hypertrophic INF Turbinate. The insured had undergone the treatment of Adenotonsillectomy + Septoplasty. Considering the nature of the ailment and line of treatment, the 3^rd opposite party required certain documents and clarifications to determine the claim's admissibility under the policy. The third-party administrator wrote various letters seeking the documents on behalf of the 3rd opposite party. However, the required documents were not submitted.

The third opposite party verified the internal case papers of the patient of the hospital, which revealed that the patient had a known case of PCOD for three to four years and was on treatment. As per the internal case paper dated 13.11.2021, the patient had allergic rhinitis since childhood. Therefore, it was very much required to have previous consultation notes with the details of previous clinical findings and history of treatment details from the time of first diagnosis to decide the claim admissibility. In the absence of the above records, the pre-existing disease exclusion under the policy cannot be ruled out.

          The case of the complainant is a suspected case of pre-existing disease under the policy, which is an exclusion. Without submitting the documents required, the claim admissibility under the policy cannot be determined. The complainant did not respond to the letter and remained indifferent throughout the claim process. Since nothing was forthcoming, the claim was closed. According to the 3^rd opposite party, the claim was not repudiated, whereas it was closed for want of documents. As per the terms and conditions of the policy, the complainant is obliged to submit the documents. The complainant is attempting to escape from the policy obligations of submitting documents. There is no deficiency in service or unfair trade practice on the part of the third opposite party.

The complainant filed proof affidavit in Lieu of Chief Examination and marked Exhibit A1 to A10. Nandankumar Gaurannavar who is Assistant Vice President Legal of the 1^st opposite party filed a proof affidavit in Lieu of Chief Examination and marked Exhibit B1 and B2 from the side of the 1^st opposite party. Mithun R, who is the Branch Manager of the 2^nd opposite party, filed proof affidavit in Lieu of Chief Examination. There is no documentary evidence from the side of the 2^nd opposite party. Leo John, Consumer Litigation Claims Manager of the 3^rd opposite party filed a proof affidavit and marked Exhibit B3 to B7 from the side of the 3^rd opposite party.

In the light of complaint and evidence on record, we would like to consider the following points.

1. Whether there is any deficiency in service or unfair trade practice on the part of the opposite parties?
2. If so, what are the reliefs and costs?

Point Nos. 1 & 2

It is an admitted fact that the complainant had taken an Arrogya Plus Insurance Policy from the 3^rd opposite party for the period from 13.08.2021 to 12.08.2022. Exhibit A9 is the Arogya Plus Policy schedule issued by the 3^rd opposite party to the complainant. On going through Exhibit A9, we see that the complainant, his wife Ancy Matthew, Nima Tressa Mathew, Mathukutty Joseph, and Neethu Ann Matthew are the insured persons under the policy. The sum insured under the policy was ₹ 3,00,000/- (Rupees three lakh only). It is further proved by Exhibit A9 that the date of inception of the first policy was 13.08.2020. Exhibit A2, which is the discharge summary issued from the SH Medical Centre Kottayam, proves that Neema Tressa Matthew, who is one of the insured under the Exhibit A1 policy, was treated at the Hospital as an impatient from 16.12.2021 to 18.12.2021 with a diagnosis of Chronic Adenotonsillitis, Septal Spur LT, Concha Bullosa Lt,  Hypertrophic Inferior Turbinate. It is further proven by exhibit A2 that the patient had undergone the Adenotonsillectomy + Septal spur excision procedure on 16.12.2021. The complainant had paid ₹ 64,528/- (Rupees sixty four thousand five hundred and twenty eight only) towards the treatment expense of the Neema Tressa Matthew. According to the complainant, his request for the cashless facility was rejected by the 3^rd opposite party and his claim for the reimbursement of the treatment expenses was not honored.

The complaint was resisted by the 3^rd opposite party, stating the patient was a known case of PCOD for 3 to 4 years and was on treatment. It is further contended by the third opposite party that, as per internal case papers dated 13.11.2021, the patient had allergic rhinitis since childhood. Upon receipt of the Exhibit B4  claim form, the first opposite party, who is the 3^rd party administrator, sent Exhibit  B6 letters to the complainant requesting to produce pre-numbered paid receipt for the amount collected from the patient on 18.12.2021 and detailed case history of the patient having previous consultation notes with the details of previous clinical findings, treatment history details from the time of first diagnosis.  According to the 3^rd opposite party, the complainant did not submit the required documents and without the required documents, the 3^rd opposite party is unable to decide the admissibility of the claim as the ailment of the patient is a suspected case of pre-existing disease, which is an exclusion under the policy. Due to the known submission of the required documents by the complainant, the 3^rd opposite party closed the claim of the complainant for want of documents.

The 3^rd opposite party relied on Clause 11(a) of the terms and conditions of the policy to close the complainant's claim. According to Clause 11(a), the insured must file the claim with all necessary documentation within 15 days of discharge from the hospital. This includes providing the insurer with written details of the claim, along with all the original bills, receipts, and other documents upon which the claim is based. Additionally, the insured must give the insurer any additional information and assistance required to process the claim. If there is a delay in submitting the claim and there is no justified reason for the delay, the insurer has the right to not consider the claim for reimbursement.

On going through the Exhibit B7 we can see that there was an entry on 13.11.2020 that the allergic rhinitis from childhood. Dr. Binu John, the  ENT consultant and endoscopic sinus surgeon of the SH Medical Center, certified in Exhibit A6 medical certificate that the ailment for which Neema Treessa Mathew had undergone treatment is unrelated to allergic rhinitis. He further certified that the etiology of the present complaints is related to hypertrophic adenotonsillitis secondary to infection, and there are no past treatment records since the first consultation date was on 18.11.2021. It is pertinent to note that even though there is an entry in Exhibit B7 that the patient has allergic rhinitis from childhood, it was not recorded that the patient was under continuous treatment for that ailment.

In a  ruling by the Honourable Supreme Court of India, under the Civil Appellate Jurisdiction, presided over by Justices M.R. Shah and B.V. Nagarathna, in the case of Gurmel Singh V. Branch Manager, National Insurance Co. Ltd. (Civil Appeal No. 4071 of 2022 dated May 20, 2022), it was observed,

"In numerous instances, insurance companies have been noted to reject claims on insubstantial or technical bases. When addressing claims, insurers shouldn't overly rely on technicalities, especially when demanding documents that claimants cannot furnish due to unavoidable circumstances."

As the 3^rd opposite party failed to prove that the insured, Neema Treessa Mathew, was under continuous treatment for allergic rhinitis, they could not ask for the detailed case history of the patient, having previous consultation notes with the details of previous clinical findings, treatment history details from the time of first diagnosis. Therefore, we are of the opinion that the 3^rd opposite party has committed deficiency in service by closing the claim of the complainant for the reason of want of required documents.

Based on the above discussion, we are of the opinion that the complainant has succeeded in proving his case, and this complaint is to be allowed. As a result, we allow this complaint and pass the following order.

1. We hereby direct the third opposite party to pay ₹ 64,528/- (Rupees sixty four thousand five hundred and twenty eight only) to the complainant.
2. We hereby direct the third opposite party to pay ₹ 25,000/- (Rupees twenty five thousand only) as compensation to the complainant for the deficiency in service on the part of the 3^rd opposite party.
3. We hereby direct the third opposite party to pay ₹ 3,000/- (Rupees three thousand only)  to the complainant as the cost of this litigation.

The order shall be complied with within 30 days from the date of receipt of the copy of this order, failing in which the compensation amount shall carry interest @ the rate of 9% per annum from the date of this order till realization.

     Pronounced in the Open Commission on this the 30^th day of July, 2024

Sri. Manulal V.S, President   Sd/-

    Smt. Bindhu R.  Member        Sd/-

    Sri. K.M.Anto. Member         Sd/-

APPENDIX :

Exhibits from the side of the Complainant :

A1     -        Copy of the submitted application.

A2     -        Copy of the discharge summary.

A3     -        Copy of the receipt.

A4     -        Copy of the cancelled cheque.

A5     -        Copy of the progress record.

A6     -        Copy of the medical certificate.

A7     -        Copy of the insurance card.

A8     -        Copy of the statement of bank account.

A9     -        Copy of the policy schedule.

A10   -        Copy of the last received letter.

Exhibits from the side of the Opposite Parties :

B1    -          Copy of letter of authority dated 23.06.2023.

B2    -            Copy of IRDAI guidelines

B3    -             Copy of the policy details

B4    -             Copy of the claim form.

B5    -            Copy of the discharge summery.

B6    -            Copy of the requirement letters dated. 17.02.2022, 23.02.2022&

                      03.03.2022

B7    -            Copy of the internal case papers

By Order,

    Sd/-

                                                                                                    Assistant Registrar