Order by:

Smt.Aparana Kundi, Member

1.       The complainant has filed the instant complaint under section 35 of the Consumer Protection Act, 2019 on the allegations that complainant obtained the policy bearing no.P/211222/01/2022/007850 for the period from 29.12.2021 to 28.12.2022. On 12.07.2022, the complainant suddenly suffering from abdominal pain and was got admitted in Dayanand Medical College and Hospital, Ludhiana and on the same day complainant applied for cashless treatment, but the Opposite Parties rejected the pre-authorization claim for cashless treatment on the ground that “as per the documents received by us it is observe that the insured patient has been suffering from the disease/condition CAD since 2013 which is prior to inception of the first policy, hence it is pre-existing disease but the insured has failed to disclose this in the proposal form at the time of inception of the first policy, this amounts to concealment of material facts”. At the time of discharge, the complainant paid Rs.67,823/- to the said hospital as treatment charges. Further alleged that complainant never suffered from any CAD problem prior to the admission in the hospital on 12.07.2022. Moreover, the complainant was admitted in the Dayanand Medical College and Hospital, Ludhiana for the complaints of abdominal pain not any heart disease. This fact is mentioned by the said hospital on discharge summary dated 15.07.2022. Thereafter the complainant supplied the entire medical reports and bills to the Opposite Party for reconsider of rejection of pre-authorization claim dated 12.07.2022, but the Opposite Party never considered the claim of the complainant. Hence, this complaint. Vide instant complaint, the complainant has sought the following reliefs:-

a)       Opposite party may be directed to pay an amount of Rs.67,823/- as expenses incurred on the treatment.

b)      To pay an amount of Rs.1,00,000/- as compensation as damages, mental tension and harassment.

c)       To pay an amount of R.50,000/- as costs of litigation expenses.

d)      And any other relief which this Commission may deem fit and proper be granted to the complainant in the interest of justice and equity.

2.       Opposite parties appeared through counsel and contested the complaint by filing written reply taking preliminary objections therein inter alia that the present pre mature complaint is filed without any cause of action, as the cashless (pre-authorization only) claim of the complainant was denied by the answering Opposite Party on the ground of pre-existing disease and non-disclosure of material facts. Further averred that present complaint pertains to insurance claim under Star Group Health Insurance Policy bearing P/21122/01/2022/007850 valid from 29.12.2021 to 28.12.2022 covering the complainant self and his wife Kamla Rani for a sum of Rs.10,00,000/-. However, it is submitted that the aforesaid insurance policy was issued to the insured subject to terms and conditions of the insurance policy. The said terms and conditions were handed over and supplied to the insured at the time of contract. Moreover, the terms and conditions of the policy were explained to the complainant at the time of proposing policy and the same were served to the complainant along with the policy schedule. The complainant has accepted the policy agreeing and being fully aware of such terms and conditions and executed the proposal form. Therefore, it is submitted that in case if any liability would arise against the answering Opposite Party, then it would be subject to the terms and conditions of the insurance policy. Further averred that the insured/complainant requested for a cashless authorization only so far, for the hospitalized on dated 12.07.2022 at Dayanand Medical College and Hospital, Ludhiana for the treatment of CAD (Coronary Artery Disease). On scrutiny of the cashless claim documents as provided by the insured and from the treating hospital record, it was found and observed by the answering Opposite Party and its medical team that the insured patient had been suffering from CAD since the year, 2013 as per his discharge summary gathered from the said hospital from dated 12.10.2013 to 16.10.2013. The medical team is of the opinion that the insured patient had a pre-existing disease prior to inception of the insurance policy and the insured has not disclosed the medical history in the proposal form and amounts to concealment of PED, thus, the cashless claim was found not payable. Further averred that complainant had a duty of disclosure of information related to all kinds of pre-existing diseases, which the applicant had prior knowledge before the commencement of the policy. The applicant had a duty to disclose as the complainant had agreed to abide by the terms and conditions of the policy. As such, in terms of the said provision of the insurance policy, the insurance company had repudiated the cashless claim of applicant in a proper manner, after due application of mind. Further contract of health insurance is a contract of Uber Fides and therefore, the utmost goodfaith is required on the part of the person who is about to take the insurance policy and anything essential which is willfully concealed by the policy holder from the insurance company amounts to fraud on the part of policy holder. Further averred that in this case, insurance company has rejected only cashless claim and the insured has not approached for reimbursement of medical expenses. Hence the company is not aware of the exact amount spent by the insured at the time of hospitalization. Further disclosures made by the proposers facilitate the insurance company to take decision whether to give coverage to the proposer and what the premium would be. In the present case, had the fact of CAD had been disclosed at the time of taking policy, either the coverage would have been denied totally or policy would have been issued with condition of permanent exclusion of ailments relating to the ailment he was suffering from. However, the applicant herein to chose not to disclose the ailments and obtained the policy. This act of applicant amounts to fraud under the Indian Contract Act and as such the contracts becomes voidable. Further insured has duty to disclose all material facts in proposal form while buying an insurance policy as per section 19 (2) of Protection of Policy Holder Regulation, 2017. Further averred that complainant has got no cause of action and locus-standi to file the present complaint. The instant complaint is neither maintainable in law nor on facts. This Commission has got no jurisdiction to try and decide the present complaint. No deficient services have been rendered by the answering Opposite Parties. On merits, all other allegations made in the complaint are denied and a prayer for dismissal of the complaint is made.

3.       Complainant also filed replication to the written reply of Opposite parties, vide which, all the objections raised by the Opposite parties in the written reply are denied.

4.       In order to prove his case, complainant tendered in evidence affidavit his affidavit Ex.C1 alongwith copies of documents Ex.C2 to Ex.C17.

5.       To rebut the evidence of the complainant, Opposite parties tendered in evidence affidavit of Sh.Sumit Kumar Sharma, Sr. Manager, Star Health & Allied Insurance Co. Ltd. Ex.OP1, 2/A alongwith copies of documents Ex.OP1, 2/1 to Ex.OP1, 2/10.

6.       We have heard the counsel for the parties and also gone through the documents placed on record.

7.       The complainant has purchased the mediclaim policy from the Opposite Parties for the period 29.12.2021 to 28.12.2022 and during the policy period he suffered abdominal pain and got admitted in Dayanand Medical College and Hospital, Ludhiana for the treatment of the same. However, main dispute arises between the parties, when the pre-authorization request of cashless treatment was rejected by the Opposite Parties. On the other hand, Opposite Parties has taken the plea that the insured/complainant requested for a cashless authorization only so far, for the hospitalized on dated 12.07.2022 at Dayanand Medical College and Hospital, Ludhiana for the treatment of CAD (Coronary Artery Disease). On scrutiny of the cashless claim documents as provided by the insured and from the treating hospital record, it was found and observed by the answering Opposite Party and its medical team that the insured patient had been suffering from Coronary Artery Disease since the year, 2013 as per his discharge summary gathered from the said hospital from dated 12.10.2013 to 16.10.2013. The medical team is of the opinion that the insured patient had a pre-existing disease prior to inception of the insurance policy and the insured has not disclosed the medical history in the proposal form and amounts to concealment of PED, thus, the cashless claim was found not payable.

8.       But we are of the view that the plea taken by the Opposite Parties for the rejection of pre-authorization request for cashless treatment is not genuine, as it is the duty of the insurance company to get medically examined the person before issuing of the policy. If the complainant was suffering from any disease prior to issuance of the policy, in question, the same must not have escaped the notice of the empanelled doctors of the Insurance Company. However, no such investigation record has been produced by the opposite parties. In case Bajaj Allianz Life Insurance Co. Ltd. & Ors. Vs. Raj Kumar III (2014) CPJ 221 (NC), it was held by the Hon’ble National Commission that usually, the authorized doctor of the Insurance Company examines the insured to assess the fitness and after complete satisfaction, the policy is issued. It was held that the Insurance Company wrongly repudiated the claim of the complainant. Furthermore, as per the policy document, at the time of purchasing the policy, the life assured has duly mentioned his age as 27.09.1953 (meaning thereby which is more than 45 years), so it was the bounden duty of the Opposite Parties-Insurance Company to get the life assured medically examined before issuing the policy in his name who was above the 45 years of age. In support of his contention Ld.counsel for the complainant placed reliance upon I.R.D.A.I Rules and Instructions with regard to thorough medical examination if the insured is more than 45 years which is reproduced as under:-

“As per instructions issued by the Insurance Regulatory and Development Authority of India (IRDAI), it was bounded duty of the insurer to put insured to thorough medical examination in case Mediclaim insured was more than 45 years and if insurance company failed to do so then insurance company has no right to decline the insurance claim on account of non disclosure of the facts of pre existing disease when the policy was taken. The above observations is supported by law cited in SBI General Insurance Company Limited Vs. Balwinder Singh Jolly” 2016(4) CLT 372 of the Hon’ble State Commission, Chandigarh.”

However, the Opposite Parties-Insurance Company has not placed on record any evidence that before issuing the policy they ever got medically examined the insured. So the abovesaid law squarely covers the case of the complainant that it was the duty of the insurer to get insured medically examined while issuing the policy and once the policy was issued the insurer cannot take the plea of pre-existing disease of the insured.

9.       Further perusal of the record reveals that the complainant admitted in the hospital for treatment of abdominal pain and not for heart disease and he has not raised the cashless request for the treatment of heart disease. So we are of the view that rejection of pre-authorization request for cashless treatment by the Opposite Parties are without application of mind. 

          Moreover, the plea taken by the Opposite Parties is also not genuine, as from the perusal of policy document Ex.C2 placed on record by the complainant, it is evident that pre-existing diseases are also covered under the policy.

10.     However, the other plea taken by the Opposite Parties is that the insurance company has rejected only cashless claim and the insured has not approached to them for the reimbursement of medical expenses. Hence the company is not aware of the exact amount spent by the insured at the time of hospitalization. We are also not agreeing with the aforesaid contention raised by the Opposite Parties, because after filing of the present complaint they are fully aware about the amount spent by the complainant, but despite that they did not do the needful to settle the genuine claim of the complainant. Moreover even if the complainant had ever lodged the claim with Opposite Parties, they definitely reject it, as the Opposite Parties have the tendency to reject the genuine claim of the complainant for one or the other reasons.   

11.     From the above, we are of the view that Opposite Parties illegally and wrongly rejected the pre-authorization cashless request of claim of the complainant.

12.     Now come to the quantum of amount to be awarded to the complainant. Vide instant complaint, the complainant claimed the amount of Rs.67,823/-, which is fully proved on record vide Ex.C7, Ex.C8, Ex.C11 to Ex.C16. However, the complainant also claimed for compensation for harassment and also for litigation expenses.

13.     In view of the discussion above, we party allow the complaint of the complainant and direct the Opposite Parties to pay an amount of Rs.67,823/-(Rupees Sixty Seven Thousand Eight Hundred Twenty Three only) to complainant. Opposite Parties are further burdened with compensation of Rs.5,000/-(Rupees Five Thousand only) to be paid to the complainant, not only for rendering deficient services but also for unfair trade practice resorted to by them while rejecting the genuine claim of the complainant. For thrusting the avoidable litigation, they are further burdened with additional costs of Rs.5,000/-(Rupees Five Thousand only) as litigation expenses. The compliance of this order be made by the Opposite Parties within 45 days from the date of receipt of copy of this order, failing which, the complainant shall be at liberty to get the order enforced through the indulgence of this Commission. Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room.

Announced on Open Commission