Punjab

Ludhiana

CC/20/285

Jasbir Kaur - Complainant(s)

Versus

Religare Health Insurance Co.Ltd. - Opp.Party(s)

Shamsher Singh

08 Aug 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:285 dated 05.11.2020.                                                        Date of decision: 08.08.2023.

 

Jasbir Kaur aged 39 years wife of Shri Virvarinder Singh, resident of V.P.O Chakmuafi, Tehsil Samrala, District Ludhiana.                                                                                                                                 ..…Complainant

                                                Versus

1. Religare Health Insurance Company Ltd., Vipul Tech Square, Tower C, 3^rd Floor, Gold Course Road, Sector 43, Gurgaon-122009, Haryana, through its Director/M.D.
2. Religare Health Insurance Company Ltd., First Floor, Building No.122/3/1, Golden Plaza, Mall Road, Ludhiana, through its Manager.                                                                                                                                                                                     …..Opposite parties 

Complaint Under Section 12 of the Consumer Protection Act, 1986.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

SH. JASWINDER SINGH, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant            :         Sh. Shamsher Singh Lohat, Advocate.

For OPs                         :         Sh. G.S. Kalyan, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                Shorn of unnecessary details, the facts of the complaint are that the complainant availed the Family Floater Policy No.12385257 from the opposite party w.e.f. 17.04.2018 to 16.04.2019 covering the complainant herself, her husband Virvarinder Singh with member ID No.59990733 and her son Sukhjeet Singh. The said policy was got renewed for the period from 16.04.2019 to 15.04.2020. The complainant stated that during the subsistence of the policy, her husband Virvarinder Singh suffered from liver problem and acute pancreatitis and was admitted in D.M.C. & Hospital, Ludhiana on 28.09.2019 vide admission No.2019068089 and remained admitted for one month and was discharged on 21.10.2019. The complainant incurred Rs.3,13,116/- on the treatment of Virvarinder Singh. The complainant raised a claim with the opposite parties vide claim No.91188681-00 dated 11.01.2020 along with all the requisite documents and information but the opposite parties denied the claim of the complainant vide denial letter dated 11.01.2020 on the grounds, reproduced as under:-

(i)      Claim repudiated for non disclosure of opium and alcohol abuse.

(ii)     Non disclosure of material fact/pre-existing ailments at time of proposal

(iii)    Permanent exclusion condition caused by suicide or substance abuse/intoxication.

The complainant further stated that the repudiation of her claim by the opposite parties is illegal, arbitrary and unilateral without any just and reasonable cause as there is no concealment or suppression of the material facts by the complainant. She had disclosed all the relevant and material facts to the agent of the opposite parties at the time of availing the policy. The proposal form for availing the policy was filled by the agent of the opposite parties who told that he has filled the form strictly as per the information provided by the complainant and she believed the agent of the opposite parties. According to the complainant, she has suffered physical and mental pain, agony, harassment, humiliation etc. due to deficiency in service and unfair trade practice on the part of the opposite parties for which she is entitled to compensation. In the end, the complainant prayed for directing the opposite parties to make the payment of claim amount of Rs.3,13,116/- along with compensation of Rs.5,00,000/- besides litigation expenses of Rs.21,000/-.

2.                Upon notice, the opposite parties appeared and filed joint written statement by taking preliminary objections that the complaint is not maintainable; lack of cause of action; the complainant is trying to mislead this Commission; the complaint is abuse of process of law etc. The opposite parties stated that  they had issued policy bearing no. 12385257 (Product: Care Floater) to Mrs. Jasbir Kaur, thereby covering herself, her spouse (insured) and son w.e.f. 17.04.2018 till 16.04.2019 for a sum insured of Rs. 5,00,000/- subject to the policy terms and conditions. The policy was renewed till 16.04.2020. The opposite parties further stated that the complainant approached them with a reimbursement claim with respect to  hospitalization of Virvarinder Singh from 28.09.2019 till 21.09.2019 at Dayanand Medical College & Hospital, Ludhiana. He was diagnosed with Acute necrotizing pancreatitis (Alcoholic), Sepsis. In order to properly analyse the claim, the company also triggered a claim investigation. The company further sought information by raising query letter dated 11.12.2019 and reminder dated 21.12.2019, 31.12.2019 as under:-

1. EXACT DURATION AND PAST HISTORY OF PRESENT AILMENT WITH 1ST CONSULTATION PAPER AND ALL PAST TREATMENT RECORDS.

PANCREATITIS.

2. PRE HOSPITALISATION OPD TREATMENT RECORD.

3. COMPLETE INDOOR CASE PAPERS WITH ADMISSION NOTES, HISTORY SHEET, DOCTOR'S NOTES, NURSING NOTES AND VITAL CHART.

According to the opposite parties, on perusal of the documents, they came to know that the insured used to consume alcohol and opium and the same was not disclosed to them at the time of inception of policy. Accordingly, the opposite parties repudiated the claim of the complainant vide Claim Denial Letters dated 11.01.2020 with the following observation:

• CLAIM REPUDIATED; FOR NON DISCLOSURE OF OPIUM AND ALCOHOL ABUSE.
• NON DISCLOSURE OF MATERIAL FACTS/PRE-EXISTING AILMENTS AT TIME OF PROPOSAL
• PERMANENT EXCLUSION: CONDITION CAUSED BY SUICIDE OR SUBSTANCE ABUSE/INTOXICATION.

The opposite parties further stated that as per the current hospitalization's discharge summary, the insured was an alcoholic. Further as per the hospitalization paper, personal history, he was a chronic alcoholic since 15 years and used to intake opium since 15 years. As per the Patient's notes dated 29.09.2019, 07.10.2019, 10.10.2019, 11.10.2019, 12.10.2019, 13.10.2019, 14.10.2019, 15.10.2019, he was a chronic alcoholic and opium addict. As per the Insured's statement, he used to consume alcohol since 2 years (60 ml/ daily). As per the initial emergency evaluation record, he was a chronic alcoholic and used to take opium (substance abuse). The complainant had the opportunity to disclose insured's habit of alcohol intake, opium intake, but she did not do so for the reasons best known to her. Further the complainant made declarations in the proposal form, which is reproduced as under:-

13.Q  Smoke, consume alcohol, or chew tobacco ghutka or paan or use any recreational drugs? F Yes then please provide the frequency & amount consumed.

Ans. Since ___No, Since ___, Since _____  No.

14.Q Any other disease/health adversity/injury/condition/treatment not mentioned above?

Ans. Since ____ No, Since ______ No, Since ______ No.

15.Q Has any of the proposed to be insured been hospitalized/recommended to

Take investigations/medication or has been under any prolonged treatment/undergone surgery for any illness/injury other than for childbirth/minor injuries?

Ans. Since ____ No, Since ____ No, Since ______ no.

 

Further the opposite parties mentioned IRDAI Regulations 2017 as well as Cause 7.1 and 7.13 of the insurance policy.

                   On merits, the opposite parties reiterated the crux of averments made in the preliminary objections. The opposite parties have denied that there is any deficiency of service and have also prayed for dismissal of the complaint.

3.                In support of her claim, the complainant tendered her affidavit Ex. CA in which she reiterated the allegations and the claim of compensation as stated in the complaint as we as affidavit Ex. CB of Sh. Virvarinder Singh. The complainant also tendered documents Ex. C1 is the copy of her Aadhar card, Ex. C2 is the copy of her NPS card, Ex. R3 is the copy of screen shot, Ex. C4 is the copy of Aadhar card of Virvarinder Singh, Ex. C5 is the copy of Claim denial letter, Ex. C6 and Ex. C7 are the copies of insurance policy, Ex. C8 is the copy of welcome letter dated 21.04.2018 and policy schedule, Ex. C9 is the copy of proposal form, Ex. C10 and Ex. R38 are the copies of registration card of Virvarinder Singh issued by DMCH, Ludhiana, Ex. C11 is the copy of the bill of DMCH, Ludhiana, Ex. C12 to Ex. C25 are the copies of patient deposit receipts/tax invoice, Ex. C26 is the copy of invoice of Payal Drug Store, Ex. C27 is the copy of In-Patient Final Bill dated 21.10.2019, Ex. C28 is the copy of cash receipt dated 24.10.2019 of Dr.  Lal Pathlabs, Ex. C29 is the copy of invoice of Payal Pharmacy, Ex. C30 is the copy of test report of Dr. Lal Pathlabs, Ex. C31 to Ex. C33 are the medical prescriptions of DMC Hospital, Ludhiana, Ex. C34 is the copy of PBF examination report, Ex. C35 is the copy of test report of A-one Computerized Laboratory, Ex. C36 and Ex. C37 are the copies of Discharge Summary and closed the evidence.

4.                On the other hand, the counsel for the opposite parties tendered affidavit Ex. RA of Sh. Ravi Boolchandani, Manager (Legal) of the opposite parties along with documents Ex. R1 is the copy certificate of incorporation pursuant to change of name issued by Government of India, Ministry of Corporate Affairs, Ex. R2 is the copy of welcome letter dated 21.04.2018 and policy document, Ex. R3 is the copy of claim form, Ex. R4 is the copy of Discharge summary, Ex. R5 is the copy of deficiency letter dated 11.12.2019, Ex. R6 is the copy of claim denial letter dated 11.01.2020, further Ex. R6 is the copy of statement of the patient during verification and investigations, Ex. R7 is the copy of proposal form,  Ex. R8 is the copy of notice of cancelation of policy dated 29.04.2020, Ex. R9 is the copy of judgment in Reliance Life Insurance Co. Ltd. Vs Rekhaben Nareshbhai Rathod and closed the evidence.

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written reply along with affidavit and documents produced on record by both the parties. We have also gone through written arguments submitted by the opposite parties.    

6.                On 16.04.2018, a proposal for obtaining the policy of insurance was submitted by the complainant Jasbir Kaur. The proposal form Ex. C9 = Ex. R7 contained “Medical/Lifestyle Related Information” by asking 15 queries and insured No.2 i.e. Virvarinder Singh answered all the queries in ‘Negative’. Also, in the said proposal form Ex. C9 = Ex. R7, insured No.2 Virvarinder Singh and two other insured persons have not disclosed any pre-existing disease. Rather, all the questions as to whether insured smokes, consumes alcohol or chew tobacco, ghutka or paan or use any recreational drugs? F Yes then please provide the frequency & amount consumed, have been answered in negative. Relying upon the disclosures and declaration of the insured persons, the opposite parties issued an insurance policy bearing no. 12385257 (Product: Care Floater) Ex. C8 = Ex. R1 to Mrs. Jasbir Kaur, thereby covering herself, her spouse (insured No.2) and son w.e.f. 17.04.2018 till 16.04.2019 for a sum insured of Rs. 5,00,000/- subject to the policy terms and conditions.  One of the terms and conditions of the policy is clause 7.1 Disclosure to Information Norm, which is reproduced as under:-

          7.1.    Disclosure to Information Norm

If any untrue or incorrect statements are made or there has been a misrepresentation, mis-description or non-disclosure of any material particulars or any material information having been withheld, or if a claim is fraudulently made or any fraudulent means or devised are used by the Policyholder or Insured Person or any one acting on his/their behalf, the Company shall have no liability to make payment of any claims and the premium paid shall be forfeited to the Company”

Further there is exclusion clause No.4 and 23 in the said policy Ex. C8, which reads as under:-

          “4.     Exclusions

          4.2     Permanent Exclusions:

The following list of permanent exclusions is applicable to all the Benefits and Optional Covers.

Any Claim in respect of any Insured Person for, arising out of or directly or indirectly due to any of the following shall not be admissible unless expressly stated to the contrary elsewhere in the Policy Terms and conditions.

23.     Act of self-destruction or self-inflicted Injury, attempted suicide or suicide while sane or insane or Illness or Injury attributable to consumption, use, misuse or abuse of intoxicating drugs, alcohol or hallucinogens.”

7.                The insured Sh. Virvarinder Singh was admitted in D.M.C. & Hospital, Ludhiana on 28.09.2019 and was discharged on 21.10.2019 and a sum of Rs.3,13,116/- were incurred on his treatment. The discharge summary of Virvarinder Singh is Ex. C36 = Ex. R4. Thereafter, the complainant lodged a claim with the opposite parties vide claim form dated 03.12.2019 Ex. R3. The opposite parties issued deficiency letter dated 11.12.2019 followed by reminder-1 dated 21.12.2019 as well as reminder-2 dated 11.01.2020 (Ex. R5) to the complainant by raising certain queries, which are reproduced as under:-

1. EXACT DURATION AND PAST HISTORY OF PRESENT AILMENT WITH 1ST CONSULTATION PAPER AND ALL PAST TREATMENT RECORDS.

PANCREATITIS.

2. PRE HOSPITALISATION OPD TREATMENT RECORD.

3. COMPLETE INDOOR CASE PAPERS WITH ADMISSION NOTES, HISTORY SHEET, DOCTOR'S NOTES, NURSING NOTES AND VITAL CHART.

On scrutiny of the said documents, the opposite parties found that the insured used to consume alcohol and opium and the same was not disclosed to them at the time of inception of policy. Accordingly, the opposite parties repudiated the claim of the complainant vide Claim Denial Letter dated 11.01.2020 Ex. C5 = Ex. R6 on the grounds, reproduced as under:-

(i)      Claim repudiated for non disclosure of opium and alcohol abuse.

(ii)     Non disclosure of material fact/pre-existing ailments at time of proposal

(iii)    Permanent exclusion condition caused by suicide or substance abuse/intoxication.

8.                The Insurance Regulatory and Development Authority of India (IRDAI) in its notification dated 16.10.2002 issued the Insurance Regulatory and Development Authority (Protection of Policyholders’ Interests) Regulations 2002 whereby the “Proposal Form” is defined in Regulation 2(d) as under:-

“2(d) “Proposal form” means a form to be filed in by a proposer for insurance, for furnishing all material information required by the insurer in respect of a risk, in order to enable the insurer to decide whether to accept or decline, to undertake the s\risk and in the event of acceptance of the risk, to determine the rates, terms and conditions of a cover to be granted.

Further Regulation 4, deals with proposals for insurance as under:-

1. Except in cases of a marine insurance cover, where current market practices do not insist on a written proposal form, in all cases, a proposal for grant of a cover, either for life business or for general business, must be evidenced by a written document. It is the duty of an insurer to furnish to the insured free of charge, within 30 days of the acceptance of a proposal, a copy of the proposal form.
2. Forms and documents used in the grant of cover may, depending upon the circumstances of each case, be made available in languages recognized under the Constitution of India.
3. In filling the form of proposal, the prospect is to be guided by the provisions of Section 45 of the Act. Any proposal form seeking information for grant of life cover may prominently state therein the requirements of Section 45 of the Act.
4. Where a proposal form is not used, the insurer shall record the information obtained orally or in writing, and confirm it within a period of 15 days thereof with the proposer and incorporate the information in its cover note or policy. The onus of proof shall rest with the insurer in respect of any information not so recorded, where the insurer claims that the proposer suppressed any material information or provided misleading or false information on any matter material to the grant of a cover.”

9.                In a case titled as Manmohan Nanda Vs United India Assurance Co. Ltd. and others 2022(I) CPJ 20 (SC) wherein the Hon’ble Supreme Court of India has held as under:-

(i) There is a duty or obligation of disclosure by the insured regarding any material fact at the time of making the proposal. What constitutes a material fact would depend upon the nature of the insurance policy to be taken, the risk to be covered, as well as the queries that are raised in the proposal form.

(ii) What may be a material fact in a case would also depend upon the health and medical condition of the proposer.

(iii) If specific queries are made in a proposal form then it is expected that specific answers are given by the insured who is bound by the duty to disclose all material facts.

(iv) If any query or column in a proposal form is left blank then the insurance company must ask the insured to fill it up. If in spite of any column being left blank, the insurance company accepts the premium and issues a policy, it cannot at a later stage, when a claim is made under the policy, say that there was a suppression or non­disclosure of a material fact, and seek to repudiate the claim.

(v) The insurance company has the right to seek details regarding medical condition, if any, of the proposer by getting the proposer examined by one of its empanelled doctors. If, on the consideration of the medical report, the insurance company is satisfied about the medical condition of the proposer and that there is no risk of pre­existing illness, and on such satisfaction it has issued the policy, it cannot thereafter, contend that there was a possible pre­existing illness or sickness which has led to the claim being made by the insured and for that reason repudiate the claim.

(vi) The insurer must be able to assess the likely risks that may arise from the status of health and existing disease, if any, disclosed by the insured in the proposal form before issuing the insurance policy. Once the policy has been issued after assessing the medical condition of the insured, the insurer cannot repudiate the claim by citing an existing medical condition which was disclosed by the insured in the proposal form, which condition has led to a particular risk in respect of which the claim has been made by the insured.

(vii) In other words, a prudent insurer has to gauge the possible risk that the policy would have to cover and accordingly decide to either accept the proposal form and issue a policy or decline to do so. Such an exercise is dependant on the queries made in the proposal form and the answer to the said queries given by the proposer.               

10.              In the Initial Emergency Evaluation Record Ex. R6, the concerned doctor of D.M.C. and Hospital, Ludhiana under the column ‘Persona History” has mentioned that the patient was having history of chronic alcoholic for 5years (1/2 bottle) and Opioid intake for 15 years.  It is further mentioned in the patient notes under heading of Night progress notes that the patient is chronic alcoholic with opioid addict and is suffering from Pancreatitis (alcohol related) with Peripancreatic collection. Moreover, in the discharge summary Ex. R4 under the column of Personal History is mentioned that the patient is alcoholic  and was diagnosed with Acute necrotizing pancreatitis (Alcoholic), Peripancreatitis collection,  Sepsis.    

11.              Therefore, the opposite parties have sought the information with regard to medical/lifestyle related information by making specific 15 queries in the proposal form Ex. R7. It was the duty of the insured to make full disclosure and no information, substance or interest was required to be concealed or omitted.          The pre-existing disease/history of the insured Virvarinder Singh being alcoholic since last 15 years and opioid addict since last 15 years was a relevant and material fact which was required to be disclosed at the time of obtaining the policy in question by the insured. Even query letter and its remainder failed to elicit desired response from the complainant. So there is a concealment and suppression of material facts which could have affected the decision of the opposite parties with regard to the terms and conditions of the policy.

                   Reference can be made to Branch Manager, Bajaj Allianz Life Insurance Company Ltd. and others Vs Dalbir Kaur in 2021 (217) AIC 50 whereby the Hon’ble Supreme Court of India has held that the contract of insurance is one of the utmost good faith and proposer who seeks to obtain policy of life insurance is duty bound to disclose all material facts bearing upon issue as to whether insurer would consider it appropriate to assume risk which is proposed. The Hon’ble Supreme Court has further held that the proposer failed to disclose vomiting of blood which had taken place barely month prior to issuance of policy of insurance and of hospitalization which had been occasioned as consequences. The assured was suffering from pre-existing ailment and judgment of NCDRC directing payment of sum insured was set aside.  

                   Further reference can be made to Reliance life Insurance Co. Ltd. and others Vs Rekhaben Nareshbhai Rathod in 2019 (2) R.C.R. (Civil) 909 whereby the Hon’ble Supreme Court of India has held that two months prior to policy obtained from appellant insured obtained policy from another company and this fact was not disclosed by the insured. Repudiation was made within two years period from commencement of insurance cover. The proposer was aware of contents of form that he was required to fill and disclosure of material for assessment of risk which was being taken by insurer which entitled the insurer to repudiate the claim.

12.               As a result of the foregoing discussion, we are of the considered view that the complainant is guilty of concealment of material facts as the insured failed to disclose in the proposal form that he chronic alcoholic since last 15 years and was opioid addict since 15 years. Therefore, in our considered view, the claim lodged by the complainant in respect of the treatment of Virvarinder Singh has been rightly repudiated. In this regard, the reference can also be made to the law laid down in Satwant Kaur Sandhu Vs New India Assurance Co. Ltd. Civil Appeal No.2776 of 2002 decided n 10.07.2009 whereby it has been held that if there was clear suppression of material facts in regard to the health of the insured, the insurer was fully justified in repudiating the insurance contract.

13.              As a result of above discussion, the complaint fails and the same is hereby dismissed. However, there shall be no order as to costs. Copies of the order be supplied to the parties free of costs as per rules. File be indexed and consigned to record room.

14.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Jaswinder Singh)                      (Sanjeev Batra)                            Member                                          President         

 

Announced in Open Commission.

Dated:08.08.2023.

Gobind Ram.

 

 

 

Jasbir Kaur Vs Religare Health Insurance Co. Ltd.                           CC/20/285

Present:       Sh. Shamsher Singh Lohat, Advocate for complainant.

                   Sh. G.S. Kalyan, Advocate for OPs.

         

                   Arguments heard. Vide separate detailed order of today, the complaint fails and the same is hereby dismissed. However, there shall be no order as to costs. Copies of the order be supplied to the parties free of costs as per rules. File be indexed and consigned to record room.

 

(Jaswinder Singh)                      (Sanjeev Batra)                            Member                                          President         

 

Announced in Open Commission.

Dated:08.08.2023.

Gobind Ram.