Haryana

Ambala

CC/69/2011

SURAJ PARKASH - Complainant(s)

Versus

NEW INDIA ASSURANCE CO - Opp.Party(s)

SANDEEP SHARMA

29 Apr 2016

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AMBALA.

 

           Complaint Case No.    : 69 of 2011

Date of Institution       : 24.02.2011

           Date of Decision         : 29.04.2016

 

            1.         Suraj Parkash Jain S/o Sh. Shadi Lal,

2.         Smt. Veena Jain wife of Sh. Suraj Parkash both residents of House No.16, Jain Nagar, Ambala City.

 

                                                                                                                                                                            ……Complainants.

 

                                                                                                   Versus

 

1.         New India Assurance Company Ltd., Branch Office SCO 19, New Municipal Shopping Complex, Ambala City through its Branch Manager.

 

2.         Raksha TPA Pvt. Ltd., 15/5, Mathura Road, Faridabad, Haryana, through its Manager.

 

                                                                                                ……Opposite Parties.

 

Complaint Under Section 12 of the Consumer Protection Act

 

CORAM:        SH. A.K. SARDANA, PRESIDENT.

                        SH. PUSHPENDER KUMAR, MEMBER.

 

Present:          Sh. Sandeep Sharma, Adv. counsel for complainant.

                        Sh. J.S. Rathore, Adv. counsel for Ops.

 

ORDER.

 

                        Present complaint under section 12 of  the Consumer Protection Act, 1986 (hereinafter in short called as the ‘Act’)  has been filed by the complainants alleging therein that  they obtained a Hospitalization Benefit/Mediclaim Policy from OP No.1 for the period ranging from  04.07.2007 to 03.07.2008  which was further renewed for the period from 04.07.2008 to 03.07.2009  and paid a sum of Rs.14463/- as premium.  It has been further contended that complainant no.2 namely Veena Jain  was ill since 3-4 months and on 28.04.2008, she was suffering from swear headache, so they consulted  with Dr. Tarun Satija, M.D (Phy.), Ludhiana who  referred the complainant No.2 to Dayanand Medical College, Ludhiana for treatment  where she was admitted  on 30.04.2008 and operated on 02.05.2008 for ‘Right Pterional Craniotomy and Clipping of right Al segment aneurysm under GA’ and discharged on 10.05.2008.  Thereafter, complainants submitted  all  the  claim documents with OP no.2 in order to get the medi-claim who is authorized agency of OP No.1 and thereby requested for claim of Rs.1,54,881/- which they incurred on treatment of complainant no.2  but Ops repudiated the claim of  complainants under the garb of Pre-existing disease vide letter dated 15.11.2008. So, complainant no.1 filed a complaint  before the Insurance Ombudsman, Chandigarh who accepted the complaint of complainant vide order dated 03.03.2009 against which Ops filed  a review application before the Ombudsman whereupon Insurance Ombudsman though held that there was no pre-existing disease but modified his decision by making the case of complainants as non-standard claim and ordered to  insurer to pay 50% of admissible amount of claim of complainants by 15.06.2009 vide order dated 25.05.2009. Therefore, the Ops sent the cheque of Rs.70097/-dated 08.06.2009 of insufficient amount to which complainants refused to receive since the order of Ombudsman was without any basis. Thus there is a clear cut deficiency in service on the part of Ops as they have wrongly repudiated the claim of complainants. Besides it, the order of Ombudsman modifying its order on non-standard basis is also wrong & unreasoned one since he has no any authority to review its order without any concrete  reasoning. Having no alternative, complainants have preferred the present complaint seeking relief as mentioned in the prayer para of the complaint. 

2.                     Upon notice, OPs appeared  through counsel and filed a joint written statement raising preliminary objections qua  non-maintainability of complaint and no cause of action  accrued in favour of complainants. On merits, it has been urged that OP No.2 after going through medical record supplied by complainant, has found that the claim is not payable on the basis of pre-existing disease and the policy is in First year of inception and moreover, the patient did not disclose about her pre-existing disease in the proposal form.  As such, Op no.2 legally repudiated the claim vide letter dated 15.11.2008. It has been admitted by the Ops that Insurance Ombudsman has held vide its order dated 03.03.2009 that the repudiation of the claim is not in order. However,  on application dated 10.04.2009 of  OP No.1, the Insurance Ombudsman reviewed its order dated 03.03.2009 by passing a modified order dated 25.05.2009  wherein it has been opined that  “making the case as non-standard, the claim on the basis of 50% admissible amount payable would meet the ends of justice.”.  In the end, Ops have prayed that claim of the complainants was rightly repudiated and there is no deficiency in service on the part of Ops and prayed for dismissal of complaint with costs.

3.                     To prove his contention, complainant tendered his affidavit as Annexure CX alongwith documents as Annexures C-1  to C-7 and closed the evidence whereas on the other hand, counsel for Ops tendered in evidence affidavits of  Dr. Amandeep Singh & Sh. B.L. Jagwan, D.M. of OP No.1 company as Annexures RX & RY respectively alongwith documents as Annexures R-1 to R-6 and closed their evidence. 

4.                     We have heard learned counsels of both the parties and gone through the record very minutely. The main grievance of the complainants is that complainant No.2 while suffering from illness remained admitted from 30.04.2008 to 10.05.2008 at Dayanand Medical College, Ludhiana  where she was operated on 02.05.2008 and incurred a sum of Rs.1,54,881/- on her treatment. But the Ops repudiated her claim illegally and without any basis whereas their contention has been accepted by the Insurance Ombudsman, Chandigarh but despite that claim has not been released by the Ops which is admittedly a deficiency in service and unfair trade practice on the part of Ops. To strengthen his case, counsel for complainant placed reliance on case laws titled as United India Insurance Co. Ltd. & Anr.  Vs. S.K. Gandhi reported in 2015(2) CLT Pg. 71 ( NC) wherein it has been held that Insurance claim (mediclaim) Heart attack-Pre-existing disease-Repudiation-On the ground that the complainant had history of acute hypertension and CAD which are main factors for heart ailment but the aforesaid ailment was not disclosed by him  to the insurance company at the time of taking the policy-No evidence that the complainant at the time of admission in hospital had himself stated that he was suffering from high blood pressure from last 8/9 years-Held- it is quite possible that the complainant despite suffering  from hypertension was not actually aware of the same-In that case, he cannot be accused of misstatement or concealment-The onus was upon the insurance company to prove that he had made a misrepresentation while obtaining the insurance policy-insurance company liable; and  Oriental Insurance Co. Ltd. Vs. Baby Simran Kaur CLT 2014(2) Pg. 361 (NC)  wherein it has been observed that “Insurance Claim-Mediclaim-Suppression of material facts-Pre-existing disease-Prior knowledge of the disease before taking policy-The claim was repudiated on the ground that the claimant had a pre-existing congenital disease, which was not disclosed, while taking the policy-Held-that if a person is suffering  from something like a defect in the heart-value since birth, abberant pancreas, ectopic pancreas or any other ailment in the internal  organs of the body, it could be termed as an internal congenital disease-The exclusion clause in the insurance policy is not attracted-No suppression of material facts or misrepresentation of any kind on the part of the policy holder-Revision petition dismissed.  and  The Oriental Insurance Company Limited Vs. Vivek Rekhan CLT 2014(3) Pg.202 (Haryana State Commission) wherein  it has been observed that “Insurance Claim (Mediclaim)-Pre-existing disease-Exclusion clause-held-Unless the terms and conditions have been supplied to the complainant before taking the policy, the same cannot be enforced-Exclusion clause not binding-Oral version cannot take the place of proof unless supported with some documentary evidence.”   

                        On the other hand, counsel for Ops argued that complainant no.2 has suppressed her pre-existing disease while filling up proposal form and on submission of claim by her with their authorized agency OP No.2, it was found from the medical record of complainant that she was suffering pre-existing disease and as per  policy clause 4.1,  they have rightly repudiated the claim of complainant as such there is no deficiency in service or otherwise  unfair trade practice on their part.

5.                     After hearing learned counsel for the parties and going through the record very carefully,  it is not disputed that the medi-claim policy was taken by the complainants from OP No.1. Further perusal of letters dated 13.10.2008 & 15.11.2008 (Annexure C-1 & C-2) reveals that OP no.2 closed/denied the claim of complainants with the observation that ‘Pt. admitted and diagnosed hypertension, SAH, segment, Aneurism, RT Pterional Craniotomy, clipping of RT A1 segment Aneurysm Done, managed conservatively and discharged with follow up.  On going through  the records it is found that patient is k/c/o hypertension from 3-4 years. As the hypertension is Aetiological factor of Aneurysm Bleed and policy is in first year inceptions, alongwith the fact that patient did not disclosed her pre-existing disease in the proposal form at the time of  policy inception the claim is repudiated on basis of pre-existing disease (clause 4.1) and for hiding facts at the time of policy inception. Hypertension, SAH, segment Aneurism’  Therefore, complainant moved the matter before Insurance Ombudsman, Chandigarh who passed the order dated 03.03.2009 (Annexure C-3) wherein it has been specifically held that ‘the insurer has not been  able to establish beyond the shadow of a doubt that the patient was suffering from hypertension for the last 3-4 years and was on meditation as mentioned in the discharge summary. Therefore, giving the benefit of doubt to the complainant regarding pre-existing disease, claim is payable  and repudiation of the claim is, therefore, ‘not in order’ and ordered that  admissible amount of claim should be paid by the insurer to the complainant by 25.03.2009 under intimation to their office.’  Meaning thereby that the Insurance Ombudsman ordered the Ops to release the claim to the complainant but inspite of releasing the claim of complainant, Ops made an application before the Insurance Ombudsman for review wherein he modified its previous order dated 03.03.2009 with the observation that ‘although hypertension for 3-4 years is written in the discharge summary and one of the causes of aneurysm  is hypertension still I am of the opinion that the surgery was done for aneurysm which cannot be treated as pre-existing disease  and the patient was not aware of the same at the time of taking the policy. Giving the benefit of doubt to the complainant, I am of the opinion that making the case as non-standard claim on the basis of 50% of admissible amount payable would meet the ends of justice. It is hereby ordered that 50% of admissible amount of claim should be paid by the insurer to the complainant by 15.06.2009 under intimation to this office” vide order dated 25.05.2009  and thus vide letter dated 15.07.2009 (Annexure C-7) Ops offered to disburse an amount of Rs.70097/- to complainants  as per orders dated 25.05.2009 of Insurance Ombudsman as full & final settlement subject to execution of consent receipt so that complainants may not approach the court of law to which complainants refused.  As per our view, the said action of Ops forcing the complainants to execute the consent receipt qua full &final settlement prior to releasing an amount of Rs.70097/- (50% of admissible amount of claim as offered by Ops vide letter dated 15.07.209 Annexure C-7) is not only a deficiency in service on the part of Ops rather is an example of unfair trade practice committed by the Ops as observed by Hon’ble Andhra Pradesh State Commission in case titled as Branch Manager LIC of India & others Vs. Pasupuleti Bhagya Laxmi  others decided on 14.08.2014 and reported in 2014(4) CLT Pg. 115 that “in a number of cases, the insurance companies are issuing policies basing on the statements made by the proposer in utmost good faith but when it comes to settlement of claims, they start examining the matter under the microscope.  In a majority of policies issued by the insurance companies they were routed through their agents. The agents in their anxiety to get their commission and the insurance company in order to do more and more business see that  the policies are issued the moment they received the premium amount. Even the insurance companies are not aware as to who is the proposer, what is his /her status or health condition etc.. Here, the intention is very clear that first they induce the people to purchase the policies and later they start litigation. Even in the instant case also, the proposal was made through agent.  On Ex.B1 we find the rubber stamps of the agent and specified person code and license Nos. on the first and last pages of the proposal.  A  close scrutiny of the proposal form would reveal  even the columns were filled up by the agent and simply obtained the signatures of proposer on ‘x’marks. It is manifest that the proposal was routed through the agent of the LIC.  If we may say so, the agents are playing fraud on LIC as well as gullible consumers with false assurances.  When the policy was issued by the insurance company with utmost good faith, the same yardstick has to be applied while settling the claims also.  The LIC ought to have made thorough enquiry, investigation or necessary medical health check—ups before issuance of policy irrespective of the amount involved.  Without doing so, when they have issued the policy, now they cannot turn round and contend that they need not pay any amount as there was suppression of material information with regard to his health”.  Besides it, the case laws submitted by counsel for complainant (supra) are also fully applicable to the facts & circumstances of the present case. As such, we have no hesitation in holding that Ops have wrongly repudiated the claim of complainants and thus are deficient in providing proper services to the complainants. Accordingly, the complaint is allowed and Ops are directed to comply with the following directions jointly and severally within a period of 30 days from the communication of this order:-

(i)        To pay a sum of Rs.1,40,194/- (Double of Rs.70097/- as offered by Ops being 50% of the admissible claim amount vide Annexure C-7) to the complainants alongwith simple interest @ 9% per annum from the date of repudiation of claim i.e. 15.11.2008 to till date.

 

(ii)       Also to pay a sum of Rs.10,000/- in lump-sum on account of causing mental harassment as well as costs of litigation etc. incurred by the complainant.

                        Further the award in question/directions issued above must be complied with by the OPs within the stipulated period failing which all the awarded amounts  shall further attract simple interest @ 12% per annum for the period of default.  Copies of this order be sent to the parties concerned, free of costs.  File be consigned to the record room after due compliance. 

Announced:29.04.2016                                                                  Sd/-

                                     

                                                                                                  (A.K. SARDANA)

                                                                                                          PRESIDENT

                                                                                                                

                                                                                                       Sd/-

                                                                                    (PUSHPENDER KUMAR)                                                                                                                                                                                               MEMBER