Order by:
Sh.Mohinder Singh Brar, Member
1. The complainant has filed the instant complaint under section 35 of the Consumer Protection Act, 2019 stating that the complainant has been taking the health insurance policy for himself and his other family members from insurance company i.e. The oriental insurance company limited, since 13.11.2016. Thereafter complainant-Kewal Krishan Garg has ported his above said health insurance policy into insurance company of opposite parties i.e. Star Health and Allied Insurance Company Limited on 03.11.2022 and opposite parties health insurance policy bearing no. P/211222/01/2023/008110 for a sum of Rs. 25 Lakh along with bonus and recharge benefit, which was valid from 25.11.2022 to 24.11.2023, in which complainant no.2 Kewal Krishan and his wife namely Meena Rani Garg were insured and again the said policy has been renewed by opposite parties vide policy no.11240503835601 for the period 25.11.2023 to 24.11.2024. Unfortunately complainant no.2 Kewal Krishan Garg suffered the problem of Fever and cough with sputum, fever spikes reducing, maximum on onset-102 deg f No H/O Joint Pains, bodyache, Jaundice, GI Bleed, HRS, HPS. Known Diabetic on OHA' and he was admitted to the MAX Centre Specialty Hospital, Saket, New Dehli for his Treatment and remained admit in the hospital for the period 02.02.2024 to 9.02.2024 and the said Hospital duly informed the opposite parties about the hospitalization of complainant and opposite parties has issued claim intimation no.CIR/2024/211222/1539556 to complainant no.2. The complainant no.2 Kewal Krishan Garg has spent Rs.3,05,039/- on his treatment at the said hospital, but complainant no.2 was in shocked on 07.02.2024, when he received a Text Massage from opposite parties that above said claim of complainant no.2 has been rejected by opposite parties. Alleged that complainants sent all the necessary documents which were demanded by opposite parties, but opposite parties on flimsy ground declined/repudiated the claim of complainant no.2 which is not justified in the eyes of law. The complainants were again shocked on 12.02.2024, when they received a letter dated 12.02.2024 from opposite parties, vide which they were informed that “During the scrutiny of the above said claim papers, we observe that you have not declared the details i.e. Disease of Hepatobiliary System and their complications, which were found to be pre-existing at the time of taking the policy for the first time during 25.11.2023 to 24.11.2024. This amount to non-disclosure of facts' and further informed that said 'This letter shall be taken as the notice of cancellation as per the above mentioned policy condition" and also informed that " we intended to cancel the coverage for the above mentioned person in the renewed policy with effect from 23.03.2024. Submitted that complainants have not concealed any material facts from opposite parties and moreover the above said policies has been issued by opposite parties. Complainant also sent legal notice dated 05.04.2024 to Opposite Parties to settle the claim and not to terminate the said medical policy, if terminated then restore the same, but to no effect. Hence, this complaint. Vide instant complaint, the complainant has sought the following reliefs:-
a) Opposite Parties may be directed to pay an amount of Rs.3,05,039/- with interest @ 12% p.a. to the complainants from the date of filing of present complaint till its realization and to restore the policy.
b) To pay a sum of Rs.50,000/- as compensation on account of mental tension, and harassment.
c) To pay Rs.5500/- as litigation expenses.
2. Opposite Parties appeared through counsel and contested the complaint by filing written reply taking preliminary objections therein inter alia that the present complaint is filed without any cause of action, as the claim of the complainant was denied by the answering OP on the ground of Preexisting disease & Non-Disclosure of material facts. Moreover the insured had applied only for cashless authorization for approximate amount of Rs.250000/- and no documents whatsoever have been submitted so far for lodging any regular reimbursement claim with the Opposite Parties for the alleged amount of Rs.305039/-. Thus the complaint being pre mature requires dismissal with compensatory costs. Averred that the present complaint pertains to insurance claim under Star Health Assure Insurance Policy bearing No.11240503835601 valid from 25.11.2023 to 24.11.2024 covering the Complainant self, his spouse Meena Rani Garg for a sum of Rs 2500000/-. The policy has been ported from Oriental Insurance Company Ltd. from dated 25.11.2022. However it is submitted that the aforesaid insurance policy was issued to the insured by the answering Opposite Party subject to the terms and conditions of the insurance policy. The complainant had accepted the policy agreeing and being fully aware of such terms and conditions and executed the proposal form. Averred further that the insured has requested for cashless only vide claim no. CIR/2024/211222/1539556 and submitted the documents for hospitalization on 03.02.2024 in Max Super Speciality Hospital West Wing New Delhi, towards the treatment of CLD for Rs.2,50,000/-. It has been observed from the submitted records (Not the entire record) that the insured patient had the above disease prior to inception of the first medical insurance policy. Since the pre-existing disease was not disclosed at the time of proposing the insurance, the cover for the insured patient is deleted ab initio. At the time of inception of the policy which is from 25 November 2023 to 24 November 2024, the proposer had not disclosed the above mentioned his medical history/health details in the proposal form which amounts to misrepresentation / non-disclosure of material facts. As per Condition No.7 of the policy issued, if there is any misrepresentation/non-disclosure of material facts whether by the insured person or any other person acting on his behalf, the Company is not liable to make any payment in respect of any claim.
Averred further that it is clear from the progress notes of medical record and field verification report that the insured has been suffering from
a. Chronic Liver disease since 2006 years (progress notes dated 02.02.2024).
b. LRLT since 2012. i.e. earlier from the inception of the insurance policy in question. (progress notes dated 02.02.2024)
c. known case of type 2 DM and hypertension (progress notes dated 04.05.2017)
The proposer had not disclosed the above mentioned medical history/health details that falls back before inception of the policy. Hence, the claim was rightly repudiated and the same was informed to the insured vide letter dated 09.02.2024. Averred further that Opposite Parties have rejected only the cashless authorization and the insured has not approached for reimbursement of medical expenses. Hence, Opposite Parties are not aware of the exact amount spent by the insured at the time of hospitalization. Averred further that the Proposer, in the Proposal form has affirmed that the Insured person was in Good health and that he has not consulted or taken treatment which could be gathered from the following:-
1. Are you in good health and free from physical and mental disease or infirmity. If not give details - Yes
2. Have you consulted / taken treatment/been admitted for any illness/disease/injury/Surgery - If yes, details - No
4. Have you ever suffered or suffering from any of the following:-
Disease of Stomach, Intestine, Liver, Gall bladder/ Pancreas, Kidney, Urinary bladder, Urinary Tract Diseases –If Yes, Since When- No
From the above finding, it is clearly evident that the insures is well aware of his past medical history and faield to disclose the same in the Proposal Form during the porting of the policy, thus violating the Cardinal Principle of the Insurance, making the contract of Insurance voidable and unenforceable. Averred further that the complainant has no locus standi or cause of action to file the present complaint against the Opposite Parties; the complaint is not maintainable in the present form; no deficient services have been rendered by the answering Opposite Parties as alleged by the complainant. On merits, all other allegations made in the complaint are denied and a prayer for dismissal of the complaint is made.
3. In order to prove the case, complainant has placed on record his affidavit as Ex.C1 alongwith copies of documents Ex.C2 to Ex.C17.
4. On the other hand, Opposite Parties have placed on record affidavit of Sh.Sumit Kumar Sharma, Authorized Signatory, Star Health & Allied Insurance Co. Ltd. as Ex.OP1,2/A and copies of documents Ex.OP1,2/1 to Ex.OP1,2/11.
5. We have heard the ld. counsel for both the parties and also gone through the record.
6. It is admitted and proved on record that the complainant availed health insurance policy namely “Star Health Assure Insurance Policy” bearing no.11240503835601 for the period 25.11.2023 to 24.11.2024 for self and his wife for a sum insured of Rs.25,00,000/-. It is also proved on record before getting insured from the Opposite Parties, the complainant was purchasing the policy from the Oriental Insurance Company Ltd. since 17.11.2016. Thereafter he ported out his policy from Oriental Insurance Co. to Opposite Parties i.e. Star Health & Allied Ins. Co. since 25.11.2022. It is also proved o record that during the policy coverage the complainant suffered “Fever and cough with sputum, fever spikes reducing, maximum on onset-102 deg f No H/O Joint Pains, bodyache, Jaundice, GI Bleed, HRS, HPS. Known Diabetic on OHA” and got admitted in Max Super Speciality Hospital, New Delhi on 02.02.2024, where he was diagnosed as ‘Post LDLT with Upper respiratory tract infection’ and after the treatment got discharged from the hospital on 09.02.2024. The complainant requested the Opposite Parties for cashless treatment, but the cashless request of the complainant was rejected by the Opposite Parties, vide letter dated 09.02.2024 on the ground of “Misrepresentation/No Disclosure” and thereafter, the Opposite Parties further issued another letter dated 12.02.2024 to complainant, vide which, they informed the complainant that “they intend to cancel his coverage in the renewed policy w.e.f. 23.03.2024”. The relevant contents of letter dated 09.02.2024 and 12.02.2024 is reproduced as under for the sake of convenience:-
Letter dated 09.02.2024
“It is observed from the submitted records that the insured patient had the above disease prior to inception of the first medical insurance policy. Since the pre-existing disease was not disclosed at the time of proposing the insurance, the cover for the insured patient is deleted ab initio.
At the time of inception of the policy which is from 25 Nov 2023 to 24 Nov 2024, the proposer had not disclosed the above mentioned medical history/health details of the insured-person in the proposal form which amounts to misrepresentation /non disclosure of material facts.
As per Condition No.7 of the policy issued, if there is any misrepresentation/non disclosure of material facts whether by the insured person or any other person acting on his behalf, the Company is not liable to make any payment in respect of any claim.
Letter dated 12.02.2024
“This letter shall be taken as the notice of cancellation as per the above mentioned policy condition.
Your are hereby informed that as per the above clause, we intend to cancel the coverage for above mentioned person in the renewed policy with effect from 23-Mar-2024.
The policy shall stay effective for the remaining family members covered.”
7. However, the rejection of the cashless claim of the complainant and thereafter cancellation of the policy on the ground of pre-existing disease by Opposite Parties is not genuine, as it is proved on record that the complainant has been availing the insurance policies from Oriental Insurance Company since the year 2016 continuously without any break till 2022 (Ex.C3 to Ex.C8) and thereafter, they ported their policy from Oriental Insurance Company to Star Health & Allied Insurance Company i.e. opposite party in the year, 2022 and the policy in question is in its 2nd year. meaning thereby that the policy in question is in its 8th year of continuation, so it cannot be said that complainant is suffering from pre-existing disease. Further, if the complainant ported his insurance policy from the previous insurance company to the present insurance company of the Opposite Party, then it is mandatory for the Opposite Parties to get the details with regard to the health status of the complainant and treatment taken by him during the policy coverage, from the previous insurance company, but the Opposite Party failed to do the same.
8. From the discussion above, we are of the concerted view that the rejection of the cashless request and cancellation of the policy in question by the Opposite Party is wrong and illegal.
9. In view of the above discussion, the instant complaint is allowed in part and Opposite Parties are directed to pay the claim for medical expenses incurred by the complainant for the hospitalization period mentioned above during the coverage period (including pre and post hospitalization charges) on submission of relevant documents and medical bills by complainant. Further the complainant is hereby directed to submit the relevant documents alongwith medical bills to the Opposite Parties. Opposite Parties are further directed to settle and pay the claim next within 30 days from receipt of the copies of bills/documents from the complainant and also to restore/revive the policy in question from the date it has been cancelled. Opposite Parties are also directed to pay compository cost of Rs.20,000/- (Rupees Twenty Thousand only) as compensation and litigation expenses to the complainant. The pending application(s), if any also stands disposed of. In case, the Opposite Parties failed to comply with the order within stipulated period as given, they are further burdened with additional cost of Rs.15,000/-(Rupees Fifteen Thousand only) to be paid to the complainant for non compliance of the order. 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
