DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II

Udyog Sadan, C-22 & 23, Qutub Institutional Area

(Behind Qutub Hotel), New Delhi-110016

Case No.566/2008

Sh. Rakesh Gupta (since deceased)

Through his LRs

1.      Ms. Shashi Gupta

          W/o Late Sh. Rakesh Gupa

2.      Mr. Amit Gupta

          S/o Late Sh. Rakesh Gupta

Both R/o

R/o B-212, Manav Appartments,

Sector-9, Rohini, Delhi-110085                         ….Complainant

Versus

1.      New India Assurance Co. Ltd.

          Regd. & Head Office,

          New India Assurance Building

          87, Mahatma Gandhi Road,

          Fort, Mumbai-400001

2.      Raksha TPA (P) Ltd.                                  (given up)  

          15/5, Mathura Road,

          Faridabad (Haryana)

3.      New India Assurance Co. Ltd.

          Branch Office No.CDU-311400

          10, Parliament Street,

          Jeevan Deep Building (IInd Floor)

          New Delhi-110001                                   ….Opposite Parties

                                                          Date of Institution        : 02.09.08     Date of Order                : 17.03.18

Coram:

Sh. N.K. Goel, President

Ms. Naina Bakshi, Member

ORDER

Deceased complainant had a mediclaim policy since 1999 for insured amount of Rs.2 lacs without any break. At the time of taking the policy he disclosed the disease CABG i.e. Byepass surgery of the heart in 1996 and after knowing the fact the OP had undertaken the policy with the full premium as per schedule/table. The complainant was given a no claim medical bonus/facility at the rate of 5% p.a. for the period from 1999-2006 and as such the benefit in the amount of Rs.70,000/- accrued in favour of the complainant in respect of the policy for the period from 15.03.06 to 14.03.07 vide policy No.311400/48/05/76858 with member ID No. 64723. The complainant suffered heart problem in the year 2006 and on 19.05.06 he was admitted in Delhi Heart Hospital, 176, Jagriti Enlave, Vikas Marg, Delhi and the OP No.2 i.e. Raksha TPA acting as an authorized agent of OP No.1 was duly informed to which the OP No.2 sent a letter dated 20.05.06 to the Delhi Heart Hospital requiring them to furnish certain details regarding the previous claim history, disease, amount and continuation of policy and coverage to which a reply was sent to the OP No.2 on 20.05.06. The OP No.2 sent another letter dated 20.05.06 which was faxed to the Delhi Heart Hospital informing them that they were unable to approve the cashless hospitalization as mentioned in the letter. It is submitted that the complainant submitted a claim for an amount of Rs.501656.46 which was duly received by the OP No.3 on 10.08.06. The OP No.2 informed the complainant vide letter dated 05.09.06 (ref. No. 900627322) that the claim is not tenable for the reasons given in the said letter i.e. pre-existing disease. The complainant then sent fax letter dated 09.10.06 vide Fax No. 95-129-2250002 requesting the OP No.2 for the reasons as to why the claim of the complainant was rejected on the plea of pre-existing disease. It is submitted that the OPs were very well aware at the time of the policy for the first time in the year 1999 about the pre-existing since 1996 as was already disclosed at the time of taking the policy and the OPs insured the mediclaim policy for Rs.2 lacs and “no claim bonus” was also given to the complainant. It is submitted that withholding and non passing of the claim by the OPs amounts to deficiency in service and unfair trade practice on the part of the OPs.  It is prayed that the OPs be directed to pay Rs.2,70,000/- to the complainant in respect of the mediclaim together with Rs.50,000/- towards compensation alongwith interest @ 18% p.a.  from the date when the amount became due till realization.

OPs in the written statement have inter-alia stated that the Insurance Co. as well as the TPA have duly verified the complaint and in furtherance of processing of the claim, documents were demanded repeatedly from the complainant but till date the same have not been furnished by the complainant. It is denied that the complainant had disclosed the disease CABG of heart in 1996.  It is stated that the complainant had concealed this fact while taking the policy and if he would have declared this fact while taking the policy, then the policy must have been issued to him with exclusion of heart disease; it is clearly mentioned in the exclusion clause of the policy that the company will not be liable to pay any claim for all the diseases which are pre-existing at the time of taking the policy. It is stated that non-disclosure of the disease renders the person to be excluded for being covered under the factum of suppression of material fact where even if the person has disclosed the disease which existed prior to taking the policy the person is excluded under clause 4.1 of the policy i.e. pre-existing disease that those diseases which are present at the time of taking the policy stands excluded. It is submitted that the claim of the complainant was repudiated strictly according to the terms and conditions of the policy. The claim of the complainant comes under the exclusion clause 4.1 of the policy i.e. pre-existing disease.  Denying any deficiency on their part, OPs have prayed for dismissal of the complaint.

Complainant has filed a rejoinder and stated that all the documents had already been delivered to the OP and the OPs have failed to disclose in reply which document they require for processing the claim. It is submitted that the complainant had disclosed the disease CABG of the heart. It is denied that the complainant is liable to give any proof of the same. The burden of proof lays on the OPs in whose possession the original proposal form is lying. It is submitted that the OPs have not filed the original proposal form and trying to take the benefit of their own wrong. It is submitted that in the policy issued by the OPs there is exclusion clause and it is mandatory for the insurer to mention the name of disease which is excluded under the policy. The complainant had duly disclosed the disease of CABG of heart in 1996 and after due consideration of the said fact the OPs had issued the policy.

Complainant has filed his own affidavit in evidence. On the other hand, affidavit of Sh. H.R. Arya, Sr. Divl. Manager has been filed in evidence on behalf of the OPs.

Written arguments have been filed on behalf of the parties.

During the pendency of the complaint the complainant died and his LRs have been brought on record.

We have heard the arguments on behalf of the parties and have also gone through the file very carefully

It is not a dispute that the deceased complainant had a policy from the OP since 15.03.1999 to 14.03.2007 (annexure-I to annexure-VII). Complainant suffered from heart- problem on 19.05.06. Cashless facility to the complainant had been refused to be given by the OPs. Thereafter, the claim lodged by the complainant with the OPs was also repudiated. The OP-1 repudiated the claim vide letter dated 05.09.2006. Annexure XIII is reproduced as under:-

“This is to inform you that the claim has been made NON-TENABLE for the following reason.

Observation and Opinion

Patient was admitted and diagnosed as a case of HT, DM, CAD – Post CABG (in 1996), Unstable Angina, Native Triple Vessel Disease with SVG to OM1 100% blocked; investigated; treated surgically (PTCA +Stent done) and discharged with follow up advice. Hence, claim stands Non-payable as per clause 4.1.

As per the clause 4.1.

All diseases/ injuries which are pre-existing when the cover incepts for the first time are not payable.”

The complainant sent a legal notice dated 19.01.2007 to OP-1 as annexure-XIV. The OP replied the legal notice vide letter dated 17.04.2007 (copy annexure-XVI).

       In view of the respective averments made on behalf of the parties, the question to be decided by this Forum is, whether at the time of taking the mediclaim policy for the first time in 1999 from the OP No.1 and 3, the complainant had informed that he had been suffering from heart ailment and had also undergone CABG in  the year 1996 and, if so, to what effect? The original proposal form must be containing this information.  

On 04.01.2018, the counsel for the complainant stated that the late complainant had been suffering from heart disease which had been disclosed in the proposal form while taking the original policy in question in the year 1999. On the other hand, this fact was denied on behalf of the OPs. The OPs were advised to file the original proposal form as it must be in their possession. OPs were granted one opportunity to file the original proposal form on the record so that this disputed fact can be decided. Case was adjourned to 22.01.2018. On 22.01.2018 OPs failed to submit the original proposal form to this Forum on the ground that “ an email in this regard has been sent to the office of OP but no response has been received so far.” Therefore, in the absence of the original proposal form being filed before this Forum it cannot be successfully contended on behalf of the OPs that while taking the first policy in the year 1999 the complainant had suppressed the fact that he was a heart patient and had already undergone CABG in 1996.

It is a matter of great sorrow that while taking business from the innocent persons, agents/officials of the insurance companies give every kind of promise but while issuing the claim amount they  take unnecessary excuses.  When the policy in question was not the first policy and was in continuation of the previous policies and the complainant had been given “no claim bonus till 2006”, the OPs were not justified in repudiating the claim under clause 4.1 of the policy issued by the OP-1 and OP-3. Clause 4.1 of the policy is reproduced below:-

Clause 4.1 : Treatment of any Pre-existing Condition/ Disease, until Thirty Six months of Continuous Coverage of such Insured Person have elapsed. For Continuous Coverage of less than Thirty Six months, the amount payable shall be restricted to a specified % of the admissible claim amount SUBJECT TO A MAXIMUM OF % OF THE SUM INSURED, as per table below:-

Therefore, even otherwise OPs had not repudiated the claim according to clause 4.1 of terms and conditions of the policy. It is clear that the policy in question was in continuation coverage for more than 36 months and hence was not covered under clause 4.1.

Therefore, the rejection of the claim by the OPs was totally illegal, perverse,  unjust and uncalled for.

The decision of the Supreme Court in Satwant Kaur Sandhu Vs. New India Assurance Co.  Ltd. Civil Appeal No.2776/2002 decided on 10.07.09 relied on behalf of the OPs does not apply to the facts of the present case since in that case the complainant had not disclosed his pre-existing disease in the proposal form. In the present case, the OPs have not produced any such proposal form before this Forum. The case of Hari OM Aggarwal Vs. Oriental Ins. Co. WP(C) 656/2007 decided on 17.07.07 applies.

In view of the above discussion, we allow the complaint and direct the OP-1 and OP-3 to pay Rs.2,00,000/-(maximum insured amount) alongwith interest @ 6% p.a. from the date of repudiation of claim i.e. 05.09.2006 till realization and Rs.20,000/- as compensation for causing mental agony and harassment to the complainant and also to LRs of the complainant to the substituted complainants in the ratio of 50:50.

The order shall be complied within 30 days of receipt of copy of this order failing which OP-1 & OP-3 shall become liable to pay interest @ Rs. 9% per annum on the amount of Rs.2,00,000/- from the date of repudiation of claim i.e. 05.09.2006 till the date of realization.

Let a copy of this order be sent to the parties as per regulation 21 of the Consumer Protection Regulations.  Thereafter file be consigned to record room.

Announced on 17.03.18.