DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, ERNAKULAM

Dated this the 26^th day of March, 2024.

                                                                   Filed on: 12/01/2022

PRESENT

Shri.D.B.Binu                                                                          President

Shri.V.Ramachandran                                                              Member Smt.Sreevidhia.T.N                                                               Member

C.C. No. 26/2022

COMPLAINANT

James Thomas, Thazhathuveettil House, Venduvazhy, Kothamangalam Pin-686691.

Vs

Opposite Parties

1. Branch Manager, The Oriental Insurance Company Ltd., Elenjickal Mathew Memorial Plaza, Church View Junction, Kothamangalam 686691

(Rep. by Adv. Anitha Mathai Muthirenthy, Chamber No. 556, KHCAA Chamber Complex, Cochin 682018)

2. Manager/Executive Officer Health Insurance TPA of India Ltd. 1 Floor, Rukhiya Bagh M.G. Road, Ravipuram Perumannoor, Ernakulam (Near Knoos Cinema Building) Pin-682016.

F I N A L   O R D E R

D.B. Binu, President.

1. A brief statement of facts of this complaint is as stated below:

 A complaint was filed under Section 35 of the Consumer Protection Act, 2019, on October 13, 2020, by the complainant against the first opposite party, represented by an authorized agent/broker, O.K. Gangadharan (License Number BA0000043836), who facilitated the inclusion of the complainant and his wife into their "Corona Rakshak Policy" with a coverage amount of Rs. 2,50,000. To maintain the policy, the complainant paid a premium of Rs. 6,936 (Policy Number: 441702/48/2021/2549; Claim Number: 211400181383). The first opposite party and the agent assured the complainant that COVID-19 affected policyholders would be eligible for the full claim amount post-hospital discharge without the need for medical bill submissions. The insurance policy was valid from October 13, 2020, to July 24, 2021. The complainant was hospitalized for COVID-19 at Rajagiri Hospital, Chunangumveli, Aluva, from July 9 to July 21, 2021, and subsequently submitted all medical certificates through the agent/broker. The Health Insurance TPA of India Limited, a third-party administrator selected by the first opposite party for claim settlements, requested additional medical documents, which were promptly provided by the complainant. Despite repeated attempts to contact the first and second opposite parties for the claim settlement, the complainant's claim remains unsettled, while his wife, Lissy James, who was also treated for COVID-19 at the same hospital, received her claim settlement. The refusal to settle the complainant's claim appears to be without any justified reason, demonstrating a discrepancy in the handling of similar claims by the insurance company.

2) Notice

The Commission issued notices to the opposite parties, who acknowledged receiving them. However, despite this acknowledgment, the opposite parties failed to submit their versions within the statutory deadline. As a result, they have been set as ex-parte in these proceedings.

   3) . Evidence

  The complainant submitted an ex-parte proof affidavit along with three documents, marked as Exhibit-A-1 TO A-3.

Exhibit A-1: The policy issued by the insurance company, including the policy number, the name of the insured, the beneficiary's name (E name), and the insured sum.

Exhibit A-2 -series: True copies of the discharge summary. (three-pages)

Exhibit A-3: True copy of the Query Letter sent by the insurance company.

4) The main points to be analysed in this case are as follows:

i)       Whether the complaint is maintainable or not?

ii)      Whether there is any deficiency in service or unfair trade practice from the side of the opposite party to the complainant?

iii)     If so, whether the complainant is entitled to get any relief from the side of the opposite party?

iv)     Costs of the proceedings if any?

5)      The issues mentioned above are considered together and are        answered as follows:

In the present case in hand, as per Section 2(7) of the Consumer Protection Act, 2019, a consumer is a person who buys any goods or hires or avails of any services for a consideration that has been paid or promised or partly paid and partly promised, or under any system of deferred payment.  A copy of the policy issued by the insurance company (Exhibit A-1). Hence, the complainant is a consumer as defined under the Consumer Protection Act, 2019, (Point No. i) goes against the opposite parties.

The complainant filed a case seeking compensation for a service deficiency, alleging that the opposite parties unjustly refused to settle a claim, thereby failing settle a claim. This refusal has led to a complaint of deficient service against the opposite parties.

The opposite parties’ conscious failure to file their written version in spite of having received the Commission’s notice to that effect amounts to an admission of the allegations levelled against them.  Here, the case of the complainant stands unchallenged by the opposite parties.  We have no reason to disbelieve the words of the complainant as against the opposite parties. The Hon’ble National Commission held a similar stance in its order dated 2017 (4) CPR page 590 (NC).

In the case citation "III (2023) CPJ 217 (Ker.)" decided by the Honourable Kerala State Consumer Disputes Redressal Commission, the issue revolved around the repudiation of a claim due to an alleged pre-existing illness. The appellant, Life Insurance Corporation of India, contested the claim made by the complainant, for expenses incurred during inpatient treatment in three hospitals. The treatments were availed during the coverage period of the policy. The commission examined the appeal and found no evidence that the complainant had any pre-existing illness at the time of taking the policy. Furthermore, it was noted that the ailments for which treatment was sought arose well after the policy had been in effect for over one and a half years, and there was no default in premium payments by the complainant.

The dictum of the Honourable State Commission emphasized that there was no justified ground for the repudiation of the claim, highlighting a deficiency in service on the part of the insurance company. The absence of any valid circumstance to deny the claim led to the conclusion that the appellant (insurance company) had no arguable case, and therefore, admitting the appeal would serve no purpose. This decision reinforces the principle that insurers cannot deny legitimate claims without a valid basis, especially when no pre-existing conditions are proven, and premiums are duly paid.

We have carefully heard the submission made at length by the complainant and have also considered the entire evidence on record.

1. Factual Background: The complainant purchased a Corona Rakshak Policy from the first opposite party, facilitated by their agent, with a coverage amount of Rs. 2,50,000. Despite assurances of coverage for COVID-19 without the need for medical bill submissions, the complainant's claim, following hospitalization for COVID-19, remains unsettled. In contrast, a similar claim for the complainant's wife was settled, highlighting a discrepancy in service.
2. Deficiency in Service and Negligence: Under Section 2(7) of the Consumer Protection Act, 2019, the complainant qualifies as a consumer. The opposite parties' refusal to settle the claim, despite the policy's assurances, constitutes a clear deficiency in service and negligence. This Commission finds the opposite parties in violation of their obligations, leading to unjust hardship for the complainant.
3. Relevant Case Laws: The Commission draws guidance from the judgment in "III (2023) CPJ 217 (Ker.)," where the Honourable Kerala State Consumer Disputes Redressal Commission held that insurers could not repudiate claims without valid justification, especially when no pre-existing condition is proven, and premiums are duly paid. Similarly, the Honourable National Commission's stance in 2017 (4) CPR 590 (NC) supports the view that non-submission of a version by the opposite parties amounts to an admission of the allegations. The unilateral failure of the opposite parties to settle the claim, despite no reasonable justification for such refusal, as a gross deficiency in service and unfair trade practice.

D. Liability of the Opposite Parties: Given the evidence, the refusal to settle the claim by the opposite parties is unjustified and tantamount to a denial of rightful benefits under the policy. Therefore, the opposite parties are held liable for the deficiency in service.

We determine that issue numbers (I) to (IV) are resolved in the complainant's favour due to the significant service deficiency and the unfair trade practices on the part of the opposite parties. Consequently, the complainant has endured considerable inconvenience, mental distress, hardships, and financial losses as a result of the negligence of the opposite parties.

In view of the above facts and circumstances of the case, we are of the opinion that the opposite parties are liable to compensate the complainant.

Hence the prayer is partly allowed as follows:

1. The Opposite Parties shall reimburse ₹2,50,000 (Two Lakh Fifty Thousand Rupees) towards the treatment expenses of the complainant.
2. The Opposite Parties shall pay ₹40,000 (Forty Thousand Rupees) towards compensation for the deficiency in service and unfair trade practice committed by the opposite parties, and for the mental agony and physical hardships sustained by the complainant.
3. The Opposite Parties shall also pay the complainant ₹10,000 (Ten Thousand Rupees) towards the cost of the proceedings.

The Opposite Parties are jointly and severally liable for the fulfilment of the above orders, which must be executed within 45 days from the date of receiving this order. Should there be a failure to comply within the stipulated period, the amounts detailed in Points I and II will accrue interest at an annual rate of 9% starting from the expiration of the 45-day period, from the date of filing of the case (12/01/2022) till the date of realization.

Pronounced in the Open Commission this is the 26^th  day of March, 2024.

Sd/-

D.B.Binu, President

V.Ramachandran, Member

Sd/-

Sreevidhia.T.N, Member

Forwarded/by Order

Assistant Registrar

Appendix

Complainant’s Evidence

Exhibit A-1: The policy issued by the insurance company, including the policy number, the name of the insured, the beneficiary's name (E name), and the insured sum.

Exhibit A-2 -series: True copies of the discharge summary. (three-pages)

Exhibit A-3: True copy of the Query Letter sent by the insurance company.

Opposite party’s Exhibits

Exhibit-B-1: The special power of attorney

Despatch date:

By hand:     By post                                                  

kp/

CC No. 26/2022

Order Date: 26/03/2024