Delhi

West Delhi

CC/14/861

Sayanpani Bhaunik - Complainant(s)

Versus

Oriental Insurance Company - Opp.Party(s)

07 Mar 2022

ORDER

BEFORE THE CONSUME DISPUTE REDRESSAL FORUM,

WEST DISTRICT, JANAKPURI,

NEW DELHI

 

CC No.   861/14

In re:-

SmtSayantani Bhowmik

ESSEL TOWER PARL COURT-III,

FLAT NO-302, M.G. ROAD, GURGAON,

                                                                                      ………..Complainant

v/s

 

the Oriental Insurance Co. Ltd.& Ors.

C-58, COMMUNITY CENTRE,

JANAKPURI, NEW DELHI-58                                    ...............Opposite Parties

 

Coram:                                                                             

1. SONICA MEHROTRA (PRESIDENT)
2. RICHA JINDAL (MEMBER)
3. ANIL KOUSHAL (MEMBER)

Date of Institution: 24.12.2014

Judgment reserved on:22.02.2022

Date of Decision:07.03.2022

ORDER

 

1. The complainant has filed the present complaint against OPs u/s 12 of Consumer Protection Act, 1986. Brief facts of the complaint are as follows :

 

1. The complainant had been taking Mediclaim policy from Respondent No.1 since 2012 and had renewed her Mediclaim Policy from respondent No.1 for the year on 17.09.2013 which covers the complainant, her mother and father for a capital sum insured of Rs. 10,00,000/- for the period 17.09.2013 to 16.09.2014.  the name of all the persons covered by the policy appears in the schedule and paid the consideration amount of Rs.25,020/- to the respondents in lieu of the same which covers cashless facility also. The respondents only gave a computerized 2 pages policy and have not given any terms and conditions.

 

2. on 14.08.2014, the complainant’s mother MrsRanjana Bhaumik was feeling pain in the abdomen and was having a fever, when she was taken to Medanta Global Health Pvt. Ltd, Hospital when after checkup it was found that the complainant was suffering from UROSEPSIS and the complainant’s mother was advised for admission in the hospital for further evaluation and management of the disease she was suffering.

 

3. The mother of the complainant was shifted to ICU when hemodialysis was initiated and the attending medical team operated on her for a left Nephrectomy on 03.09.2014 after various tests were performed on her. The patient remained hospitalized and she underwent various multiple treatments as found suitable by the team of attending doctors after a long treatment she was discharged on 25.10.2014 but the condition of the patient again deteriorated on 27.10.2014 when she was again down with high-grade fever and ultimately expired on the same date.

 

4. The hospital authorities where the complainant’s mother was admitted immediately intimated respondent No.2 the TPA of Respondent No.1 for a cashless facility and requested respondent-2 to approvethe cashless facility as per the Contract Insurance.

 

5. The TPA i.e. Respondent No.2 informed by email to Medanta Hospital on 18.08.2014 that case less facility cannot be granted to the complainant on account of execution clause 4.1 of the policy i.e. PRE-EXISTING NATURE OF ILLNESS /DISEASE/INJURY UNDER the policy. 

 

6. The complainant was shocked to know that the cashless facility has been rejected by Respondent No.2. however, since treatment was required, the complainant had no opinion but to arrange for the funds from the market on loan etc.

 

7. On receipt of rejection, the complainant met the concerned doctors, who advised the complainant that rejection is illegal as the pre-existing disease i.eDiabetes Mellitus is not related to the current ailment. A certificate to this effect was also issued by the Hospital which was supplied to OP-2 but still, no positive response was received from them.

 

8. The complainant spent a total sum of Rs.31,37,358/- for the treatment of her mother as per hospital bill No.GHIPBL/15044346 dated 25.10.2014 AND GHOBL/15540541 dated 28.10.2014.

 

1. Since an intimation about the admission was lodged immediately by the complainant’s hospital with the Respondents for cashless which was rejected, the complainant was asked to submit necessary documents for settlement after discharge of the patient. That accordingly, all the necessary papers viz claim form duty completed, admission and discharge summaries and medical bills of the hospital, bills for the medicines purchased including prescription and testing reports in original were submitted to the respondents amounting to Rs. 31,37,358.00 with the entire medical record of the patient on 04.11.2014.

 

10. The respondents did nothing to settle the claim of the complainant which they were supposed to settle in advance directly with the hospital or with the complainant but even though all the required papers were submitted to them long back and the complainant have been reminding the respondents over the phone and by personal visits to settle the claim but nothing was done till 27.10.2014 when the complainant was shocked to receive a letter of rejection from OP-1.

 

11. especially when the complainant has spent the entire amount from her pocket as well as taking loans from relatives/friends and was under acute financial constraint and rejecting the claim thereafter on flimsy grounds under the shelter of terms and conditions of the policy which were never a part of the contract issued to the complainant and were never supplied to the complainant.

l.The above act of the respondents is nothing but fleecing the general public under the grab of covering them under the mediclaim policies which were created for the benefits of the public at large. The exclusion clauses referred to by the respondentsare never brought to the knowledge of the general public nor the beneficiaries are made aware of these exclusions which are put in a fine print and are kept only with the Insurance companies to defraud the general public of their legitimate claims. Non-settlement of the genuine claim amounts to a clear deficiency of service on the part of the respondents. Finding no other option, the complainant filed the present complaint wherein he prayed for a sum of Rs. 10,00,000/- which is the maximum sum insured under the policy on account of the hospitalization expenses of the complainant’s mother which were to the tune of Rs. 31,37,358/- with interest thereon @ 24% interest.

 

13. The respondents are further liable to pay compensation for a sum of Rs.2,00,000/- to the complainant for mental agony, pain and sufferings, as the genuine and legal claim of the complainant was rejected on false and frivolous grounds which were neither the part of the contract nor brought to the knowledge of the complainant at the time of taking the policy.

 

14. The respondents are also liable to pay Rs.1,00,000/- to the complainant for the cost of litigation and other misc.expense.

 

2. After hearing the arguments on admission, the present complaint was admitted and accordingly notice was issued to the OP on 03-03-2015. Accordingly,OP appearedto filea written statement on the same day.

 

3. The OP filed a written statement taking preliminary objection that:-

 

1. As per records, the complainant got insured herself under Mediclaim Insurance Policy vide Policy No.215500/48/2013/2739 from the office of OP without disclosing to the respondents that she was a known case of DM, CKD and post nephrectomy (right side) and already undergone treatment for the same.  The insurance was for a period of one year which was again renewed for another year w.e.f. 17.09.2013 to 16.09.2014 vide policy No.215500/48/2014/2970.

 

2. In the proposal form under “self-declaration form,” the insured /complainant herein stated that neither she nor her dependent are suffering from any disease and all of them are in good health and free from physical and mental disease.

 

3. As per Medical History in the discharge summary of the hospital, it is seen that the mother of the complainant was already suffering from uncontrolled diabetes Mellitus and underwent surgery for post Nephrectomy (right side) in 2013 and Appendectomy 30 years before, which were not stated in Self Declaration Forms submitted with an intention to defraud the company. 

 

4. As per the MMR report issued by the treating doctor, it is confirmed that the patient was suffering from DM for 15 years, hypertension for 05 years and acute chronic kidney disease since 2013.  All this information was not declared and disclosed by the complainant/insured in the proposal form while taking the policy.

 

5. While renewing the policy from another office of the company vide letter dated 05.09.2014 the complainant/insured gave wrong information that she had not taken any claim payment in the expiring policy due to her malicious intention whereas the fact was that she had lodged the present claim with the company on 4.11.2014 for the hospitalization of her mother for the period 14.08.2014 to 25.10.2014.  not only this, she, in order to avoid more disclosures, refuses to submit a fresh proposal stating that the same has already been submitted with the previous office.

 

6. The complainant/insured while renewing her policy with another office of the company on 05.09.2014 failed to intimate the office that her mother is hospitalized w.e.f. 13.08.2014 as this was a material fact that could have affected the renewal of the policy and the company could have declined her proposal of renewal of moral hazard.

 

7. The complainant requesteda cashless hospitalization facility on 18.04.2014 through the hospital which was denied by Respondent No.2 TPA vide its mail and the complainant was advised to submit all claim documents for possible reimbursement subject to the admissibility of a claim as per terms and conditions of the policy. 

 

8. Thereafter, some papers were submitted by the complainant to the office of respondent No.2 when the claim papers submitted by the complainant were scrutinized/processed by a Third Party Administrator and the TPA came to the conclusion after application of its mind on the claim documents and DISCHARGE SUMMARY of Hospital observed that the complainant misrepresented/concealed the facts from the underwriters and the claim falls under exclusion clause 4.1 of policy. Since the present claim falls within the exclusion clause 4.1 and 16 of the policy, TPA accordingly recommended repudiation of the same to respondent No.1

 

1. Respondent No.2 after receipt of confirmation from respondent no.1repudiated the claim of the complainant as not payable and treated the same as NO CLAIM on account of exclusion clause 4.1 and intimated the same to the complainant vide their letter dt.26.12.2014.

 

10. The instant complaint is not maintainable because of the abuse of the process of law and as such the present complaint is liable to be dismissed on this ground.

 

11. The instant complaint is not maintainable and is liable to be dismissed on account of condition No.16 of the policy of insurance i.e. FRAUD/MISREPRESENTATION/CONCEALMENT which clearly says that “ Company shall not be liable to make any payment under this policy in respect of any claim if such claim is in any manner intentionally or recklessly or otherwise misrepresented or concealed or non-disclosure of material facts or making a false statement or submitting falls bills whether by the insured person or institution/Organization on his behalf. Such action shall render this policy null and void and all claims hereunder shall be forfeited.  The company may take suitable legal action against the insured persons/institution/Organization as per law.

 

50. The instant complaint is not maintainable and is liable to be dismissed as there is no deficiency of service on the part of the answering respondent.

 

13. The instant is not maintainableand is liable to be dismissed on account of violation of policy terms and conditions as the complainant was bound to submit the claim papers within 7 days of his discharge from the hospital as per terms and conditions of policy but the complainant submitted these papers after 10 days.                                                                                                          n      The instant complaint is not maintainable and is liable to be dismissed as the same is beyond the purview of the insurance contract since the disease for which the treatment was taken was under exclusion clause/pre-existing one as per the Discharge Summary of Medanta Global Health Pvt. Ltd., as well as the same is not covered under the policy on account of exclusion clauses 4.1 of the insurance policy issued to the complaint which clearly says……….. Exclusion 4.1: During the period of Insurance cover, the expenses on treatment of following aliment/ disease/ surgeries for specified periods are not payable if contracted and/or manifested during the currency of the policy i. to xxiv and especially the undertaking/declaration being signed by the person while entering into the contract with the respondents which is a part of the proposal and which read as under:
    1. “ I hereby declare and warrant that the above statements are true and complete. I consent and authorize the insurers to seek medical information from any Hospital/ Medical Practitioner who has at any time attended or may attend concerning any disease or illness which affects my physical or mental health. I agree that this proposal shall form the basis of the contract should the insurance be affected. If after the insurance is affected, it is found that the statements, answers or particulars stated in the Proposal form and its questionnaires are incorrect or untrue in any respect, the insurance Company shall incur no liability under the insurance”.
       1. I have read the Prospectus and am willing to accept the coverage Subject to the terms, conditions and exceptions prescribed by the Insurance Company therein. Sd-……………

 

2. In view of the above explicit declaration, it is most respectfully submitted that the resultant contract is void for non-disclosure of material facts. The respondents have, therefore, rightly repudiated the claim of the complainant under exclusion clause 4.1 of the contract.
3. A copy of the Policy has been already placed on records of the Hon’ble Forum submitted by the Complainant as Annexure C-1. However, another copy of the insurance contract along with the Proposal duly filled and signed by the complainant at the time of entering into the contract is annexed with Annexure R-1 since the Policy placed on record is incomplete.

 

• M/s MDINDIA Health Care Services Pvt. Ltd., (TPA) appointed by the respondents under Statutory obligations have carefully considered the claim documents submitted by the complaint and after application of its mind and after receipt of verification of the records of the Hospital wherein the complainant was admitted for her treatment, and the medical expert advice by a qualified doctor had taken the decision of repudiating the liability as per the aforesaid clauses of the contract of Insurance. Since the complainant has foisted a claim upon the respondents based on misrepresentation/concealment of material facts that she was having the disease since 2013 and also HTN and DM since 5 and 15 years while taking an insurance cover, the present complainant is liable to be dismissed.

 

16. The instant complaint is not maintainable and is liable to be dismissed as the complainant has not come before the Hon’ble Forum with clean hands.

 

4. The complainant has filed a rejoinder and their affidavit in evidence testifying all the facts stated in the complaint along with documents exhibit CW-1/1 to CW- 1/5 on 6/04/2015.

 

5. Thereafter when the matter was adjourned for respondent evidence, but on 1/7/2015, instead of filing respondent’s evidence the counsel for respondent filed an application for amendment of the written statement filed by them and after the arguments said application was allowed subject to cost of Rs 1,000/- vide order dated 21/12/2015. On 21/04/2016, Sh. Meena Kalra, Divisional Manager of Oriental Insurance Co. Ltd. has filed his affidavit in evidence on behalf of respondents.

 

6. Written submissions have also been filed by both parties on 27/07/2018.Finally, oral arguments of both parties were heard on 22/02/2022 and order reserved.

 

7. During the arguments learned counsel for the complainant has further argued that the terms and conditions of the Insurance Policy were never communicated to the insured persons nor were they supplied with a copy of the Insurance Policy. The deceased was not told that the Insurance Policy was applicable only in the case of accidental death and therefore, the OP is liable to pay compensation to the complainant

 

4. The controversy in the present case is as to whether the complainant is entitled to the claim amount or not. The factual position is not in dispute OP categorically admitted the issuance of policy in the present case also a treatment given to the complainant and the period of admission is also not in dispute. The only issue raised by the OP is that the complainant was suffering from a pre-existing disease at the time of issuance of the policy, therefore, her claim was hit by clause 4.1. of terms and conditions.

 

5. First of all, we need to clarify that the terms and conditions being relied upon by the OP should form part and parcel of the Insurance policy but in the present case terms and condition is a separate full-fledged document that was intentionally kept under wraps by OP to press into service only when the claim shall be filed before it. It is now well-settled law that terms and conditions of contract cannot be pressed into service unless and until the same is duly supplied to the insured at the time of inception of the contract of insurance. Perhaps this condition has not been complied with by OP.

 

6. 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 non-disclosure of the lads which the parties knew. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose ill material facts in their knowledge since the obligation of good faith applies to both equally.

 

7. On this issue, we are guided by the Hon’ble Apex court in the case of M/S Modern Insulators Ltd vs The Oriental Insurance Co. Ltdreported in reported in (2000) 2 SCC 734, where the following order has been passed.

 

• “As the above terms and conditions of the standard policy wherein the exclusion clause were included, were neither a part of the contract of insurance nor disclosed to the appellant respondent cannot claim the benefit of the said exclusion clause.”

 

<>8.Further In "Bharat Watch Company vs. National Insurance Co. Ltd. [2019 (6) SCC 212] (supra)", the Hon'ble Supreme Court

 has held as follows:-

" The basic issue which has been canvassed on behalf of the appellant before this Court is that the conditions of exclusion under the policy document were not handed over to the appellant by the insurer and in the absence of the appellant being made aware of the terms of the exclusion, it is not open to the insurer to rely upon the exclusionary clauses.”

 

9 Further Hon’ble NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION  NEW DELHI in CONSUMER CASE NO. 1094 OF 2018 

1.    titled as M/S. ANJANEYA JEWELLERY vs NEW INDIA ASSURANCE CO. LTD. & ORS. Decided on 21/09/2021 held that 

“ From the discussions of Hon’ble Supreme Court, two principals emerged as follows:

(i)     There is no difference between a contract of Insurance and any other Contract, and that it should be construed strictly without adding or deleting anything from the terms thereof.

<>9.(ii)    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 non-disclosure 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 the obligation of good faith applies to both equally.  

If the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither

 a part of the Contract of insurance nor disclosed to the Insured, the Insurance Company cannot claim benefit of 

the said Exclusion Clause.

 

 

Applying the Principles laid down by the Hon'ble Supreme Court referred to above, to the facts of the present case, we find that there is no material on record to establish that the Opposite Party Insurance Company had given the Terms and Conditions of the Special Package Insurance Policy or at any point of time or ever informed the Complainant about the same. Thus, the Exclusion Clause based on which the Opposite Party Insurance Company had repudiated the Insurance Claim of the Complainant, cannot be sustained as the Opposite Party Insurance Company could not rely upon the same”

 

10. Apart from this the plea taken by OP as to the pre-existing disease having been suffered by the complainant does not hold water, firstly, because no declaration form has been placed on record by the OP, not any medical record has been submitted for perusal by the Commission whereby the complainant had received prior medical treatment for the same illness. It is now the well-settled proportion of law that every disease cannot be construed as a pre-existing disease.

 

11. Hon’ble Delhi State Commission in the case titled National Insurance Co. Ltd. Vs Smt. Krishna Avtar Aggarwal II (2005) CPJ 747, held as under:

 

“Insurance- Mediclaim policy- Repudiation of claim- Concealment of pre-existing disease alleged- Complaint allowed by Forum- Hence appeal- Non-disclosure of disease for which insured was treated 15/ 20 years before, not amounts to concealment- Word ‘existing’ means a disease which exists at the time of taking the policy- O.P. should have ensured that person in whose favour policy was being given was entitled to same or not- Contributory negligence on part of O.P. cannot be ruled out- O.P. liable under policy- Order of Forum upheld.

 

12. On the concept, meaning and import of word disease, pre-existing disease in reference to the medical insurance policy, Hon’ble State Commission, New Delhi has drawn the following ten conclusions in a highly extensive, dissecting manner in their decision in the matter titled as Pradeep Kumar Garg v. National Insurance Co. Ltd., reported in FA-482/2005 decided on 01.08.2008. These are as under:-

1. Disease means a serious derangement of health or chronic deep-seated disease frequently one that is ultimately fatal for which an insured must have been hospitalized or operated upon in the near proximity of obtaining the mediclaim policy.

 

2. Such a disease should not only be existing at the time of taking the policy but also should have existed in the near proximity. If the insured had been hospitalized or operated upon for the said disease in the near past, say, six months or a year he is supposed to disclose the said fact to rule out the failure of his claim on the ground of concealment of information as to pre-existing disease.

 

3. Malaise of hypertension, diabetes, occasional pain, cold, headache, arthritis and the like in the body are normal wear and tear of modern-day life which is full of tension at the place of work, in or out of the house and are controllable on day to day basis by standard medication and cannot be used as concealment of pre-existing disease for repudiation of the insurance claim unless an insured in the near proximity of taking of the policy is hospitalized or operated upon for the treatment of these diseases or any other disease.

 

4. If insured had been even otherwise living a normal and healthy life and attending to his duties and daily chores like any other person and is not declared as a diseased person as referred above, he cannot be held guilty for concealment of any disease, the medical terminology of which is even not known to an educated person unless he is hospitalized and operated upon for a particular disease in the near proximity of the date of insurance policy say few days or months.

 

5. Disease that can be easily detected by subjecting the insured to basic tests like blood tests, ECG etc. the insured is not supposed to disclose such disease because of otherwise leading a normal and healthy life and cannot be branded as a diseased person.

 

6. Insurance company cannot take advantage of its act of omission and commission as it is under obligation to ensure before issuing medi-claim policy whether a person is fit to be insured or not. It appears that insurance companies don't discharge this obligation as half of the population is suffering from such malaises and they would be left with no or very little business. Thus, any attempt on the part of the insurer to repudiate the claim for such non-disclosure is not permissible, nor is exclusion clause invokable.

 

7. Claim of any insured should not be cannot be repudiated by taking a clue or remote reference to any so-called disease from the discharge summary of the insured had concealed his hospitalization or operation for the said disease undertaken in the reasonable near proximity as referred above.

 

8. Day to day history or history of several years of some or the other physical problem one may face occasionally without having landed for hospitalization or operation for the disease cannot be used for repudiating the claim. For instance an insured had suffered from a particular disease for which he was hospitalized or operated upon 5, 10 to 20 years ago and since then had been living healthy and normal life cannot be accused of concealment of pre- existing disease while taking mediclaim policy as after being cured of the disease, he does not suffer from any disease much less the pre-existing disease while taking mediclaim policy as after being cured of the disease, he does not suffer from any disease much less the pre- existing disease.

 

1. For instance, to pay that insured has concealed the fact that he was having pain in the chest off and on for years but has never diagnosed or operated upon for heart disease but suddenly lands up in the hospital for the said purpose and therefore is disentitled for claim bares dubious design of the insurer to defeat the rightful claim of the insured on flimsy ground. Instances are not rare where people suffer a massive attack without having even been hospitalized operated upon at any age say for 20 years or so. Non-instance of hospitalization/or operation for disease that too in the reasonable proximity of the date of mediclaim policy is the only ground on which insured claim can be repudiated and on no other ground.

 

8. The counsel for the OP to establish that the complainant’s mother/ deceased had a pre-existing ailment has not placed any document. It is to be noted that while relying on the said hospitalization, OP did not file any treatment record to show the Pre-existing ailment suffered by the deceased. In such a case, we are merely left with the interpretation provided by the counsel for the complainant.

 

9. During the arguments, the counsel for op states that the Complainant had not mentioned anything about his mother's Previous illness in the proposal form/self-declaration form but he failed to file said proposal form on record.Strangely, the whole defense of the respondent is based on the proposal form submitted by the complainant but the respondent miserable failed to file such a relevant document. The onus to prove the pre-existing disease lies on the respondents and admittedly the OP has not filed any supporting documents in support of their assertion. Therefore, it conveys that pre-existing disease would be one that was suffered by the insured soon before taking the policy and for which the complainant was hospitalized or has undergone any surgery in the hospital. Even otherwise a duty is cast upon O.P to establish pre-existing disease by leading cogent medical evidence that the insured was having a pre-existing disease. No evidence has been placed on record by O.P in this regard.

 

10. The National Consumer Disputes Redressal Commission in its recent judgment titled Reliance Life Insurance Co. Ltd &Anr. v. Tarun Kumar Sudhir Halderin Revision Petition No. 2097 of 2019 has reiterated the aforesaid position. The same has been reproduced below:

 

"The Insurance Company has not filed any evidence to show that the DLA was taking treatment for the disease before filling up the proposal form. Even if there was disease inside the body, but the life insured did not know about the disease and was not taking any treatment for the same, the insurance claim cannot be denied on the mere presumption that the life assured might be suffering from a pre-existing disease. Thus, on merits, I am convinced on the basis of the entries in the Medical Attendant Certificate that the disease was complained for the first time by the DLA on 22.06.2011, which is much after the date of the proposal form. The onus to prove the pre-existing disease lies on the Insurance Company and no supporting documents have been filed by the Insurance Company in support of their assertion. Moreover, in case of diabetes of late, this Commission has been taking a view that diabetes is a lifestyle disease and is so common in India that the whole insurance claim cannot be rejected on this ground."

 

11. The Hon’ble Supreme Court in its recent judgments titled  “Oriental Insurance Co Ltd.vs. Mahendra Construction = (2019) 18 SCC 1 357 and LIC of India vs Smt.   G.M. Channabasamma(1991)1 SCC 357held that

“ For an insurer to repudiate the policy it must establish suppression or misrepresentation of material facts on the part of the insured “.

 

12. We are of the considered opinion that it is pertinent to note that the onus to establish that the complainant had a pre-existing medical ailment, i.e. diabetes or Hypertension was on the insurance company. However, the appellant has not produced any document and has not been able to prove that the respondent had diabetes for the last fifteen years. Nothing has been brought on record by the respondent which could conclusively suggest that the respondent had diabetes before availing of the insurance policy.

 

13. THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION: DELHI M/S The Oriental Insurance Co. ... vs Asha Sethi &Anr. In First Appeal No., 116/2017 decided on 16.02.18 held that -

“ Even otherwise illness of hypertension and diabetes mellitus are the lifestyle-related disease which cannot by any stretch of imagination be termed as pre-existing because the same can be taken care and controlled by conservative treatment.”

 

14. Further, the case summary of the Complainant’s mother-patient from Medanta Hospital categorically mentions that the respondent was detected with "diabetes type 2". The categorical mention of diabetes fortifies the case of the appellant. Therefore, it is established that the respondent was diagnosed with diabetes, but at the same time, the treating doctor of the complainant’s mother also issued the certificate stating therein that the patient was diagnosed with Urosepsis, which is not related to diabetes mellitus. Hence because of the certificate issued by Dr, Vaibhav Gupta, who was also the treating doctor of the patient, the patient’s claim does not cover under the Exclusion clause if any, hence the Exclusion Clause would not come to the rescue of the respondents to repudiate the genuine claim of the complainant.

 

15. That the respondent failed to prove that the diseasesuffered by the complainant on 14th August 2019 was caused by diabetes mellitus type II and hypertension. That appellant had disclosed that he was a diabetic and was on medication and the test done for the same showed good results. It was submitted that the respondent further failed to prove that the complainant was sufferingfrom diabetes mellitus type II and hypertension at the time of filing the proposal form and had made a false representation and suppressed material facts.

 

16. It was the specific contention of the complainant that the exclusionary conditions in the policy document had not been communicated by the insurer as a result of which the terms and conditions of the exclusion were never communicated. The fact that there was a contract of insurance is not in dispute and has never been in dispute. Hence the only issue is whether the exclusionary conditions were communicated to the complainant or not and since the insurer did not furnish the terms and conditions of the exclusion and special conditions to the complainant and hence, they were not binding. 

 

17. 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 non-disclosure of the lads which the parties knew. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose ill material facts in their knowledge since the obligation of good faith applies to both equally as guided by the Hon’ble Apex court in the case of M/S Modern Insulators Ltd vs The Oriental Insurance Co. Ltdreported in (2000) 2 SCC 734. Which states that

 

• “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 non-disclosure of the lads which the parties known. 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.”

 

18. We also relied on another judgment of Supreme Court in United India Insurance Company Limited v. M.K.J. Corporation reported in (1996) 6 SCC 428.The Supreme Court held as follows:

"It is a fundamental principle of Insurance Law that utmost good faith must be observed by the contracting parties. Good faith forbids either party from concealing (non-disclosure) what he privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. Just as the insured has a duty to disclose, "similarly, it is the duty of the insurers and their agents to disclose all material facts within their Knowledge, since obligation of good faith applies to them equally with the assured.

 

The duty of good faith is of a continuing nature. After the completion of the contract, no material alteration can be made in its terms except by mutual consent. The materiality of a fact is judge by the circumstances existing at the time when the contract is concluded.”

Applying the Principles laid down by the Hon'ble Supreme Court referred to above, to the facts of the present case, we find that there is no material on record to establish that the Opposite Party Insurance Company had given the Terms and Conditions of the Policy or at any point of time or ever informed the Complainant about the same. Thus, the Exclusion Clause based on which the Opposite Party Insurance Company had repudiated the Insurance Claim of the Complainant, cannot be sustained as the Opposite Party Insurance Company could not rely upon the same”

 

19. Keeping in view the circumstances and reasons stated above, since the Opposite party failed to prove on record that they supplied terms and conditions of the policy to the complaint with insurance policy. Admittedly opposite party failed to file either the proposal form or the self declaration form on record. In the absence of such crucial documents,we are of the opinion that the repudiation of the claim of the complainant was highly unjustified, unwarranted and unfounded. Non-settlement of the claim of the complainant in such an event of withheld information of 7 & 8 of policy is a clear case of deficiency in service on the part of the respondents as per the Consumer Protection Act. Therefore, we direct Ops to reimburse a sum of Rs. 10,00,000/- (being sum insured of the policy) subject to compulsory deductions, if any with interest @ 6% p.a. from the date institution of the complaint till payment to the complainant . We further direct OP to pay a sum of Rs.15,000/- towards harassment mental agony & loss of time to the complainant inclusive of cost of litigation.

 

20. Let the order be complied with by OPs within 30 days from the date of receipt of the copy of this order.

 

21. Let a copy of this order be sent to each party free of cost as per Regulation 21 of the Consumer Protection Regulations.

 

22. File be consigned to record room.

 

23.  Announced on 07.03.2022.

 

 

(Richa Jindal)         Member

(Anil Kumar Koushal)               Member

(Sonica Mehrotra)                         President