DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-II
Udyog Sadan, C-22 & 23, Qutub Institutional Area
(Behind Qutub Hotel), New Delhi- 110016
Case No.309/2015
Shri Manish Sawhney
C-55, 2nd Floor,
Nizamuddin East, New Delhi
….Complainant
Versus
Religare Health Insurance Co. Ltd.
P- 3B, District Centre, Saket,
New Delhi- 110017
….Opposite Party
Date of Institution : 10.11.2015
Date of Order : 07.03.2022
Coram:
Ms. Monika A Srivastava, President
Ms. Kiran Kaushal, Member
Sh. U.K. Tyagi, Member
ORDER
Member: Shri U.K. Tyagi
The Complainant has put in a claim of Rs.1,69,142/- alongwith interest thereon @24%; Rs.1,50,000/- on account of mental agony, pain and suffering and a sum of Rs.50,000/- as cost of litigation vide its instant complaint.
The facts leading to the case are that the Complainant had been taking Mediclaim Policy from National Insurance Company ltd. (hereinafter referred as OP) for many years, covering the insurance of Complainant, his wife and dependent children for a total sum of Rs.5,00,000/- each. The Policy was last renewed from 28.06.2015 to 27.06.2016 vide policy No.214303/48/2015/4075. The Complainant after having uneasiness and breathlessness on 27.07.2015 was taken to Medanta Global Health Pvt. Ltd. He was diagnosed as PULMONARY EMBOLISM but later on after various tests were performed, it was found that he was down WITH B/L EXTENSIVE PNEUMONIA. He remained in Hospital w.e.f. 27.07.2015 to 31.07.2015 and spent a sum of Rs.1,66,887/- during this period of hospitalization. A copy of the discharge summary and medical bill is exhibited as Annexure C-‘2’.
The intimation of admission in hospital and for seeking pre-authorization for the Hospital expenses was taken up with OP by the Complainant. The complainant further alleged that the OP refused cashless facility on flimsy ground under clause 6.1 of pre-existing clause of policy whereas no such clause was supplied inspite of the fact that the Hospital had clearly issued a certificate dated 30.07.2015 stating that there is no past history of OSA/Hypertension. The same is exhibited as Annexure C-‘4’.
The Complainant further stated that to his utter surprise, the claim was repudiated entirely on the ground of terms and conditions of Policy vide clause 6.1 and HTN since 3-4 years and OSA since two years. The same is exhibited as Annexure-‘6’.
On the other hand, the OP took preliminary objections and exhorted that the Complainant is a known case of Hypertension (HTN) and obstructive Sleep Apnea (OSA) as is reflected from the Indoor Case Papers (ICPs) of said hospital:-
- Initial assessment and treatment sheet mentions OSA 2 years and HTN
- Psychological evaluation sheet mentions HTN for 3-4 years – All the above exhibited as Annexure-‘1’.
Clause 6.1 refers to non-disclosure of material facts/pre-existing ailment at the time of proposal
Clause 6.1 of the policy runs as under:-
“If any untrue or incorrect statements are made or there has been a misrepresentation, mis-description or non-disclosure of any material particular or any material information having been withheld or if a claim is fraudulently made or any fraudulent means or devices are used by the policy-holder or the insured person or anyone 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.”
It would be seen from the above that the declaration made by the Complainant under Heading “Pre-existing Disease Detail”- where the Complainant categorically denied the existence of any ailment. Copy of the Proposal Form is exhibited as Annexure-‘4’.
To buttress his claim, the OP has referred the case of Satwant Kaur Sandhu v/s New India Assurance Company Ltd.(2009) 8 SCC 316, it has been observed by the Hon’ble Supreme Court that “the expression “material fact” is to be understood to mean as any fact which would influence the judgment of a prudent Insurer, in deciding whether to accept the risk or not. If the proposer has knowledge of such fact, he is obliged to disclose it particularly while answering questions in the proposal form. Any inaccurate answer will entitle the Insurer to repudiate their liability because there is clear presumption that any information sought for in the Proposal Form is material for the purpose of entering into a contract of insurance, which is based on the principle of utmost faith – uberrimae fides.”
The OP also mentioned in its reply, the case of Life Insurance Corporation of India vs Smt. Neelam Sharma as pronounced by the Hon’ble National Commission on 30.09.2014.
Since the patient was a known case – HTN and OSA which was not disclosed at the time of policy inception, hence, the claim was bound to be rejected. Further, it is added that if the Complainant does not submit the requisite document, the OP is well within its right to cancel the policy as per clause 6.1 of the policy. The OP contended that since the Complainant had not bother to comply the direction, hence the OP vide its letter dated 28.10.2015 cancelled the policy which being void ab-initio due to non-disclosure of material facts.
Likewise, the OP also denied the averments made by the Complainant, in its reply to merits in detail. It is noticed that the OP had taken strong exception on the non-disclosure of material facts in the Proposal Form which led to the negation of the claim of Complainant, on the premise that the Policy being void ab-initio and is therefore violative of principle of utmost faith- uberrimae fides.
Reply to the Complainant is placed on record. Rejoinder is on record. Both the parties have filed evidence by way of affidavits and written submissions. Oral arguments are heard and concluded. The Complaint was dismissed vide order dated 19.02.2016 by this Commission. The said order was set aside by the Hon’ble State Commission vide its order dated 26.05.2016 and consequently complaint was restored.
This Commission has examined the materials on record and pleadings carefully. The repudiation letter dated 24.08.2015 was also gone through. The central issue for negation of claim, had been non-disclosure of pre-existing disease/ailments. In the context of the above, the case of Yogesh Baiswala v/s Life Insurance Corporation of India and Anr. was pondered over wherein the Hon’ble State Commission vide its order dated 07.11.2012 dwelt upon the concept, import and meaning of the words “pre-existing disease” with reference to the Insurance Contract of the parties. The relevant paras are re-produced here for ready reference:-
- ‘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.
- Such a disease should not only be existing at the time of taking the policy but also should have existed in the yard 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”.
- 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 and 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.
- If insured had been even otherwise living 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 date of insurance policy say few days or months.
- Disease that can be easily detected by subjecting the insured to basic tests like blood test, 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 ‘diseased person’.
- Insurance Company cannot take advantage of its act of omission and commission as 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 discharged 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’ invocable.
Claim of any insured should not be and cannot be repudiated by taking a clue or remote reference to any so-called disease from the ‘discharge summary’ of the insured by invoking the ‘exclusion clause’ or non-disclosure of ‘pre-existing disease’ unless the insured had or non-disclosure of ‘pre-existing disease’ unless the insured had concealed his hospitalization or operation for the said disease undertaken in the reasonable near proximity as referred above.
- 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 since then had been living healthy and normal life cannot be accused of concealment of ‘pre-existing disease’.
- For instance, to say that insured has concealed the fact that he was having pain in the chest off and on for years but has never been 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 attach without having even been hospitalised or operated upon at any age say for 20 years or so.
- Non-disclosure of hospitalization/or operation for disease that too in the reasonable proximity of the date Mediclaim policy is the only ground on which insured’ claim can be repudiated and on no other ground.
Relying on the above observations of Hon’ble State Commission, this Commission also feels that denial of claim of the Complainant is based on flimsy ground and remote inference. The advice rendered by the Medanta Hospital as exhibited Annexure C-‘4’ clearly states that “there is no significance past history pertaining to current illness” whereas the base of instant repudiation is on the pre-existing disease/ailment and non-disclosure of the same.
In view of above facts and circumstances, this Commission has no doubt in stating that the OP is squarely responsible for deficiency in service and gross negligence in not accepting the claim of the Complainant. Accordingly, we direct that OP to process the claim of the Complainant within two months from the date of this order with the interest @6% p.a. thereon on the said amount/claim failing which interest shall be charged @9% p.a. till its realization. As regards to compensation on account of mental agony and suffering, Rs.10,000/- is to be granted. Rs.5,000/- is to be granted for litigation charges.
File be consigned to the record room after giving copy of the order to the parties. Order be uploaded on the website.
