Order by:

Smt.Aparana Kundi, Member.

1.       The  complainant  has filed the instant complaint under section 35 of Consumer Protection Act, 2019 on the allegations that the complainant is account holder with Punjab National Bank, G.T.Road, Moga branch and he has been purchasing the health policies from Opposite Parties since the year 2016-17 and the premium is being paid through Punjab National Bank to the Opposite Parties because the Punjab National Bank has tie up with the Opposite Parties and accordingly, the complainant purchased policy bearing No. P/211222/01/2022/002756 valid for the period w.e.f. 11.7.2021 to 10.07.2022 against the paid up premium of Rs.19,587/- and this policy is named Family Package Policy and it is called as Star Group Health Insurance Policy-Gold for Bank account holders of PNB only and in this policy the complainant and his family members including his wife are covered regarding the medical treatment/ health insurance  of medical expenses of any type for an amount of Rs.5 lakhs as sum assured. Further alleges that during the policy period in the month of December, 2021, Smt.Usha Rani wife of the complainant suddenly suffered pain and she was diagnoses with problem of heart and she immediately visited DMC and Heart Institute Ludhiana where she remained admitted from 02.12.2021 to 13.12.2021 as by pass surgery was conducted.  In this regard, the complainant approached the Opposite Parties and requested for the pre-authorization for giving cashless treatment as the policy in question was cashless policy, but the pre authorization treatment was declined by the Opposite Parties. After discharge of his wife from the hospital, the complainant lodged the claim for the reimbursement of the hospitalization charges under the policy and also completed all the formalities, but the Opposite Parties rejected the claim of the complainant vide letter dated 4.12.2021 on the ground of pre existing disease whereas the complainant was never diagnosed  for such disease before the proposal of the policy.  As such, there is deficiency in service on the part of the Opposite Parties. Vide instant complaint, the complainant has sought the following reliefs.

a)       The Opposite Parties may be directed to reimburse the amount of Rs.3,59,000/-  regarding the medical expenses alongwith interest @ 12% per annum  and also to pay  Rs.1 lakh  on account of compensation due to mental tension and harassment caused by the complainant besides Rs.22,000/- as litigation expenses.

b)      And any other relief to which this District Consumer Commission may deem fit be granted in the interest of justice and equity.       

2.       Opposite Parties-Insurance Company  appeared through counsel and contested the complaint by filing  the written version taking preliminary objections therein inter alia that the complaint filed by the complainant is not maintainable and is liable to be dismissed as the complainant has attempted to misguide and mislead this District Consumer Commission.  Brief facts are that the complainant has concealed the material facts regarding his past health history. The present application pertains to Insurance Claim under  the policy in question  It is established from the treating hospital that the insured was a patient of long standing Heart Disease and there is a history of PTCA (PRECUTATNEOUS TRANSLUMINAL CORONARY ANGIOPLASTY) in year 2013 prior to the policy inception and the same was never disclosed at the time of procurement  of policy and thus the claim was found not payable.  The insured/ complainant by not disclosing the PED before procuring the policy has violated the policy document/ contract and also the core of principle of insurance. The insured requested for a cashless authorisation for the treatment for chest pain at Dayanand Medical College & Hospital and on scrutiny of the cashless, claim documents as provided by the insured, it was found and observed by the Opposite Parties that “As per the evaluation sheet and Out patient card  submitted by the insured has Post PTCA since 2013 and the query was raised to submit previous treatment record to the insured vide treating hospital. In reply the insured submitted the previous treatment records and as per the Discharge Summary dated 08.11.2013, the insured was diagnosed with Type 2 DM, HTN, CAD and underewent CAG, PTCA with stenting to LCX and hence it  is found that the insured patient had a long standing heart disease and the patient insured had already undergone PTCA in the year 2013 which was not disclosed at the time of procuring the insurance policy and hence the heart disease  is a pre existing disease.  Hence, the claim of the complainant was rightly repudiated after due application of mind.   On merits, the Opposite Parties took  up almost same and similar pleas as taken up by them in the preliminary objections and hence no illegality has been committed by the Opposite parties while repudiating the claim of the complainant and the complaint may be dismissed with costs. 

3.       In order to  prove  his  case, the complainant has tendered into  evidence his affidavit Ex.C1 alongwith copies of documents Ex.C2 to Ex.C11 and  closed the evidence on behalf of the complainant.

4.       On the other hand,  to rebut the evidence of the complainant,  Opposite Parties also tendered into evidence the affidavit of Sh.Sumit Kumar Sharma Ex.OP1, 2/A alongwith copies of documents Ex.OP1, 2/1 to Ex.OP1,2/10 and closed the evidence.

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

6.       During the course of arguments, ld.counsel for the Complainant as well as ld.counsel for Opposite Parties has mainly reiterated the facts as narrated in the complaint as well as in the written statement respectively. We have perused the rival contentions of the parties and also gone through the record on file.

7.       The main contention of the complainant is that at the time of proposal the life assured complainant was not suffering any disease. Moreover, the complainant has been purchasing the family package policy in question since the year 2016-2017 continuously and as such paid hefty amount on account of premiums to the Opposite Parties, but till date not even a single penny has been claimed under the said policies except the present one, but the opposite parties intentionally and knowingly repudiated the lawful and genuine claim of the complainant for the hospitalization of his medical treatment without application of mind. On the other hand, ld.counsel for the Opposite Parties has repelled the aforesaid contention of the complainant on the ground that on scrutiny of the claim documents, it is established from the treating hospital that the insured was a patient of long standing Heart Disease and there is a history of PTCA (PRECUTATNEOUS TRANSLUMINAL CORONARY ANGIOPLASTY) in year 2013 prior to the policy inception and the same was never disclosed at the time of procurement  of policy and thus the claim was found not payable.  The insured/ complainant by not disclosing the PED before procuring the policy has violated the policy document/ contract and also the core of principle of insurance. The insured requested for a cashless authorisation for the treatment for chest pain at Dayanand Medical College & Hospital and on scrutiny of the cashless, claim documents as provided by the insured, it was found and observed by the Opposite Parties that “As per the evaluation sheet and Out patient card  submitted by the insured has Post PTCA since 2013 and the query was raised to submit previous treatment record to the insured vide treating hospital. In reply the insured submitted the previous treatment records and as per the Discharge Summary dated 08.11.2013, the insured was diagnosed with Type 2 DM, HTN, CAD and underewent CAG, PTCA with stenting to LCX and hence it  is found that the insured patient had a long standing heart disease and the patient insured had already undergone PTCA in the year 2013 which was not disclosed at the time of procuring the insurance policy and hence the heart disease  is a pre existing disease and hence the claim of the complainant was rightly repudiated after due application of mind.  But we do not agree with the aforesaid contention of the ld.counsel for the Opposite Parties. The onus to establish this fact is upon the Opposite Parties in this case.  We have perused the copies of  medical record placed by Opposite Parties of the treating hospital, but there is neither any affidavit nor  complete particulars of the investigator recorded in them. Even the original certificate has not been placed on the record. There is no affidavit of doctor of the treating hospital to establish this fact on the record regarding previous disease of insured. He is a private doctor and not posted in any recognized health institute or government hospital. We are unable to rely upon the above referred investigation report appended with the Photostat copy of  medical record of complainant. In the absence of any affidavit of investigator and the affidavit of treating doctor of the hospital, we do not place any reliance upon these documents, as pressed into service by the Opposite Parties in this case. Consequently, we are of this view that Opposite Parties have failed to discharge the onus solemnly laid upon it to prove this fact that insured was suffering from above pre-existing disease before taking the policy and she deliberately and fraudulently concealed this material fact from Opposite Parties. We, thus, conclude that there is no substantive evidence on the record to prove this fact that insured was suffering from any disease before she took the insurance policy and she willfully suppressed this fact fraudulently from the Opposite Parties. Moreover, if the insured was suffering from any diseases 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.”

8.       Furthermore,  as per the Dependent Identity Card placed on record by the complainant as Ex.C2,   at the time of obtaining the policy, the Usha Rani, insured has duly mentioned her age as 69 years (meaning thereby which is  more than 45 years, so it was the bounden duty of the Opposite Parties-Insurance Company to get the insured medically examined before issuing the policy in her name who was above 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 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.       It also needs to be mentioned that Section 19 of the General Insurance Business (Nationalization) Act, 1972 states that it shall be the duty of every Insurance Company to carry on general insurance business so as to develop it to the best advantage of the community. The denial of medical expenses reimbursement is utterly arbitrary on the ground that disease in question was pre-existing disease. It is mere an excuse to escape liability and is not bona fide intention of the insurance company. Fairness and non-arbitrariness are considered as two immutable pillars supporting the equity principle, an unshakable threshold of State and public behavior. Any policy in the realm of insurance company should be informed, fair and non-arbitrary. When the insurance policy has exclusions/conditions to repudiate the claim or limit the liability, the same must be specifically brought to the notice of the insured and are required to be got signed to show that such exclusions and conditions have been brought to his/her notice.  Recently, our own Hon’ble State Consumer Disputes Redressal Commission, Chandigarh in  First Appeal No. 50 of 2019 titled as Bajaj Alliance General Vs. Arjan Singh decided on 04.03.2021 also held so.

10.     The need for interpreting a contract always arises in two situations, (i) when a gap is needed to be filled in the contract and (ii) an ambiguity is needed to be resolved in the contract, then to find out correct intention of the contract, spirit behind it is required to be considered. Normally, the insurance policy is a contract of adhesion in which other party is left with hardly any bargaining power as compared to the insurer. Insurance contracts are standard form contracts and are drafted by the insurance company and as such, insurance company is at higher footing than the insured. The benefit of such clause, as exclusion clause, would go to the insured unless the same is explained in clear terms by the insurer. In such circumstances, the tribunal would be more oriented towards the interpretation which goes against the party who has inserted/drafted the disputed clause in the agreement/contract. The adjudicating authority is required to look into whether the intention of the party is to exclude or limit liability has been appropriately explained to the other party or not. This Commission while interpreting insurance agreement is to honour the intention of the parties, who have signed the agreement. Even if the agreement had general exclusion/condition for misrepresentation still fraudulent misrepresentation and non-disclosure may not be there. The innocent and negligent misrepresentations are to be ignored.  On the other hand, the rulings (i) Satwant Kaur Sandhu Vs. New India Assurance Company Limited, (ii) Murti Devi Vs. Birla Sun Life Insurance and (iii) Mamohan nanda Vs. United India Insurance Company Limited,   cited by the ld.counsel for the Opposite Parties  are not applicable and relevant  to the facts of the present case.  The insurance companies are in haste to charge the premium, but when the time to pay the insurance claim comes, they generally take up one excuse or the other to avoid their liability. The reliance of counsel for the appellant on law laid down in “Life Insurance Corporation of India Vs. Priya Sharma & others” 2012(4)CPJ-646, “Life Insurance Corporation of India & others Vs. Harbans Kaur” 2009(3)CPC-677, and “Life Insurance Corporation of India & another Vs. Ashok Manocha” 2011(3)CPC-285, would have been applicable, had this fact been established that life assured suffered from pre-existing ailment of kidney and he deliberately suppressed this fact fraudulently from the Opposite Parties, when he took the insurance policy. In view of our finding recorded above that Opposite Parties had failed to prove this fact that complainant was suffering from any pre-existing ailment and hence these authorities would not be attracted in this case. In this regard, on the same and similar facts and circumstances of the case, Hon’ble State Consumer Disputes Redressal Commission, in First Appeal No.62 of 2015  decided on 02.02.2017 in case India First Life Insurance Vs. Ms.Sudesh Rani also held so.   

11.     In such a situation the repudiation made by Opposite Parties-Insurance Company regarding genuine claim of the complainant have been made without application of mind. It is usual with the insurance company to show all types of green pasters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation.  This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible.  It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-

“It seams that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.  The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.

12.     In view of the above discussion, we hold that the Opposite Party-Insurance Company have  wrongly and illegally rejected the claim of the complainant.

13.     Now come to the quantum of compensation.  The complainant has claimed the amount of Rs.3,59,000/- on account of hospitalization charges on the treatment of Usha Rani insured, but  perusal of the record i.e. In-Patient Final Bill of the treating  hospital i.e. Dayanand Medical College & Hospital Managing Society Ex.C8 shows that he has paid Rs.2,50,598.74 paisa to the treating hospital and on the other hand, the Opposite Parties have not denied these expenses spent by the complainant on the treatment of insured Usha Rani  and hence we hold that the complainant is entitled to the reimbursement of this amount.   

14.     In view of the aforesaid facts and circumstances of the case,  we partly allow the complaint of the Complainant and direct Opposite Parties-Insurance Company to pay Rs.2,50,598.74 paisa (Rupees Two Lakh Fifty Thousands Five Hundred Ninety Eight and Paisa Seventy Four Only) to the complainant  alongwith interest @ 8% per annum from the date of filing the present complaint i.e. 03.03.2022 till its actual realization.   The compliance of this order be made by the Opposite Parties within 60 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 District Consumer Commission.  Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room.

Announced in Open Commission.