Nidhi Verma, Member.

1        The present complaint has been received from the District Consumer Disputes Redressal Commission Amritsar by the order of the Hon’ble State Consumer Disputes Redressal Commission Punjab, Chandigarh for its disposal.

2        The complainant has filed the present complaint by invoking the provisions of Consumer Protection Act under Section 11 and 12 against the opposite parties on the allegations that the complainant has purchased cashless health insurance policy from the opposite party for himself as well as for his family members namely Seema Mahajan (wife) , Mehak Mahajan, Tania Mahajan (daughters) and Nikhil Mahajan (son) under the plan of family health Optima Insurance policy. He has been purchasing this policy for his aforesaid family members since the year 2013 i.e. 2013-14, 2014-15, 2015-16 and 2016-17, continuously. The present current policy is bearing No. P/2111111/01/2017/002343 for the period valid from 30.7.2016 to midnight 29.7.2017 for the insured amount of Rs.4,15,000/- with the premium of the total amount of Rs.10,822/- duly paid by him to the opposite party time to time. During the validity period of the current policy, the daughter of the complainant namely Mehak Mahajan suffered pain over her right hip with difficulty in walking as she had fallen from stairs on 6.11.2016 leading to injury over her right hip and she remained admitted for her treatment of the said disease from 8.11.2016 to 12.11.2016 in Amandeep Hospital, G.T. Road, Amritsar. At the time of her admission in the hospital, the complainant had brought to the notice of the hospital authorities regarding cashless policy obtained by him for himself and his family members from the opposite party and had submitted the policy documents to them and accordingly, the hospital authorities had reported the matter about the disease and treatment being provided to the daughter of the complainant, to the opposite parties as under the terms & conditions of the said policy, the opposite parties have to pay the amount of expenses on the said hospital. But the opposite parties had wrongly, illegally, arbitrarily and malafidely rejected the pre-authorization from cashless treatment of the patient vide their repudiation letter dated 9.11.2016 written to the hospital authorities, on flimsily grounds that the claim of the insured patient is not admissible under the above insurance policy issued for following reason:

“The patient is a known case of Takayasu Arteritis and post CVA-under regular treatment, including steroids. These conditions are pre-existing i.e. prior to the inception of policy with us. These conditions may or may not be related to the present claim, but these have not been disclosed at the time of taking the policy. Hence, authorization given is withdrawn and the claim is rejected. Hence, the pre-authorization request for cashless treatment of above insured patient is not approved”.

The rejection of the claim of the insured patient i.e. the daughter of the complainant on the aforesaid ground is totally wrong, illegal, arbitrary, unjust, malafide, vindictive, against the law, rules, terms & conditions of the policy and hence, liable to be set aside by this Hon'ble Commission. As stated above, such cashless policy is being obtained by the complainant for himself and his family members since for the last 4 years continuously from the opposite party and huge amount of premium is being paid by him on each & every policy is being purchased. The rejection of the claim prima facie shows that infact, the opposite party wants to grab the huge amount covered under this policy with some malafide intention to deprive the complainant of his legal right to get the insurance claim. He has been paying huge amount of the premium from his family members to the opposite parties and when they have illegally, malafidely rejected the claim. At the time of issuing the policy in question, the opposite party had obtained the medical checkup of all the family members from the doctor of their panel and at that time, no such disease was detected.  On account of the illegal rejection of the claim by the opposite party, the complainant remained admitted in hospital with affect from 8.11.2016 to 12.11.2016 and during this period complainant spent Rs.61,888/- and Rs.11,036/- as medicine charges from his pocket to the hospital authorities for the treatment of his daughter, which he is legally entitled to receive from the opposite party under said policy and they are legally bound to pay. No reason for rejection the claim has been assigned by the opposite party. The reason assigned by the opposite party is not valid as the complainant has been insured Rs.4,15,000/ and has paid consolidated premium for five members of the family.  The aforesaid act on the part of the opp. party amounts to a great deficiency in service and due to which he has suffered a huge mental pain, agony, harassment, tension, financial loss, inconvenience at their hands. The complainant is entitled to Rs.61888/- towards Hospital treatment charges and Rs.11,036/- towards medicine expenses, the complainant also claim interest at the rate of 12% per annum to the tune of Rs.13301/-. The complainant is also entitled to claim Rs. 1,36,225/- from the opposite party and prayed that the complainant be awarded Rs. 61,888/- towards hospital treatment charges, Rs. 11,036/- towards Medicine expenses, Rs. 50,000/- towards damages, Rs. 13,301/- towards interest and in this way the complainant is entitled to claim Rs. 1,36,225/- from the opposite party. Further interest at the rate 12% per annum from the date of complaint till the realsiation of the amount be also awarded to the complainant. Cost of the complaint be also awarded to the complainant. 

3        After formal admission of the complaint, notice was issued to Opposite Parties and opposite parties appeared through counsel and filed written version and contested the complaint by interalia pleadings that the present complaint is not legally maintainable. The complainant has not come to this commission with clean hands and suppressed the true and material facts from this commission, as such, he is not entitled to any relief as claimed for. The complainant is estopped by his own act and conduct from filing the present complaint. The complainant has got no cause of action to file the present complaint.  The complainant obtained the policy of Family Health Optima Insurance Policy from the opposite party covering Ashwani Kumar himself, Seema Mahajan wife, Mehak Mahajan, Tania Mahajan and Nikhil Mahajan children as policy No.P/211111/01/2014/000977 from 13.7.2013 to 12.7.2014, further renewed as policy No.P/211111/01/2015/001153 from 13.7.2014 to 12.7.2015, then renewed as policy No. P/211111/01/2016/001882 from 30.7.2015 to 29.7.2016 and then as policy No. P/211111/01/2017/002354 for the period from 30.7.2016 to 29.7-2017. Preamble of the Policy clearly states the Proposal, Declaration and other documents if any given by the proposer form the basis of the policy of insurance “Subject to terms, conditions, exclusions and definitions contained herein or endorsed or otherwise expressed hereon, the company undertakes if the insured person shall contract any disease or suffer from any illness or sustain any bodily injury through accident and if such disease or injury shall require the insured person, upon the advice of the duly Qualified Physician / Medical Specialist Practitioner or duly qualified Surgeon / Medical to incur Hospitalization expenses for medical /surgical treatment at any Nursing Home / Hospital in India as herein defined as an inpatient the Company will pay to the insured person the amount of such expenses as are reasonably and necessarily incurred in respect by or on behalf of the Insured Person up to the limits indicated" The Company's liability in respect of all claims admitted during the period of insurance shall not exceed the sum insured per family mentioned in the schedule. The terms and conditions of the Policy were explained to the complainant at the time of proposing policy and the same was served to the complainant along with the Policy Schedule. In the face of the schedule, it is clearly mentioned that "The Insurance under this policy is subject to conditions, clauses, warranties, exclusion etc., Attached.". The complainant's daughter Mehak Mahajan admitted in Amandeep Hospital, Amritsar on 8-11-2016 for the treatment of IMPCTED # NECK OF FEMUR-LEFT and submitted pre authorization request for cashless treatment. On perusal of the claim documents, it was observed that (1) as per Pre Authorization Form, the insured was admitted with the complaints of pain and swelling Left Leg and the Provisional Diagnosis Femur Neck Left. (2) The treating doctor certificate states that the insured was fell down from the stairs at home on 6.11.2016. The cashless was authorized for Rs.20,000/- on 9-11-2016. (3)Further during the field visit, it was observed that (a) the outpatient card dated 28-6-2013 of Nehru Hospital that the insured patient has undergone treatment for CVA (left Hemiparesis). Takayasu disease and also prescribed Tab Ecosprin & Tab. Wyslone, (b) The CT Scan report dated 27.6.2013 revealed Takaysu arteritis, (c) The PET CT Report dated 2.7.2013 hypo metabolism in the right thalamus. (d) The history and examination Chart dated 8.11.2016 states that the insured was o/c/o (Old case of) CVA on reqular treatment and KCO Takaysu Arteritis. From the above findings, it was observed that the insured had CVA prior to the policy inception and the same was not disclosed in the proposal form. The cashless authorization was withdrawn and denied the same vide letter dated 9.11.2016, Subsequently, the insured submitted claim records for reimbursement of medical expenses. On scrutiny of claim records, it was observed that as per discharge summary that (a) the insured was admitted in hospital on 8.11.2016 and discharged on 12.11.2016, (b) she was diagnosed Impacted # NOFLT, (c) Surgery CRIF, (d) History: OCO CVA (Regular treatment). The outpatient card dated 28-6-02013 of Nehru Hospital that the insured patient has undergone treatment for CVA (left Hemiparesis), Takayasu disease which is prior to the inception of the medical insurance policy and hence it is a pre-existing disease. At the time of inception of the policy which is from 13.7.2013 to 12.7.2014, the insured have not disclosed the above mentioned medical history/health detail of the insured person in the proposal form which amounts to misrepresentation/non-disclosure of material facts. As per condition no.8 of the policy, 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. Hence the claim was repudiated and the complainant was duly intimated in this regard vide letter dated 16-12-2016. As per clause No. 15 of the policy the company may cancel the policy on grounds of misrepresentation/non disclosure of material facts as declared ion proposal form/at the time of claim. Hence the policy in respect of Mehak Mahajan stands cancelled with effect from 26.12.2016 due to nondisclosure of PED-TAKAYASU ARTERITIS POST CEREBROVASCULAR ACCIDENT. In consequence thereof, the entire policy is cancelled and for the rest of the members, a separate policy is issued for the same period. Even otherwise, as per the certificate of treating doctor, the complainant fell from stairs at home on 6.11.02016, but she was admitted in the hospital on 8.11.2016, which also amounts to misrepresentation and concealment of facts. As such, the repudiation of claim is genuine and valid one and claim is not at all payable.  In the instant case, the complainant has knowingly disclosed the past medical history in the proposal form at the time of the inception of the policy. Hence, the claim is not payable. The complainant has filed this complaint vexatiously and frivolously for the sole purpose of harassing the opposite parties with the intention for getting unlawful enrichment from the opposite parties who are dealing with public money and functioning under the guidelines of IRDA controlled by the Government of India. As public money is held in trust, the company must exercise abundant caution indealing with the claims by applying all conditions correctly and denied the other contents of the complaint and prayed for dismissal of the same.  

4        To prove his case, Ld. counsel for the complainant has tendered in evidence affidavit of complainant Ex. CW1/A alongwith documents Ex. C1 to Ex. C-33, affidavit of Ms. Mehak Mahjan Ex. CW2/A and closed the evidence. On the other hands, Ld. counsel for the opposite parties tendered in evidence affidavit of Sh.P.C.Tripathy, Zonal Manager Ex.OP-I, copy of the resolution of the company Ex.OP-2, copy of the power of attorney in favour of V.Jaganathan Ex.OP-3, copy of power of attorney in favour of P.C.Tripathy Ex.OP-4, copy of the terms and conditions Ex.OP-5, copy of the proposal form Ex.OP-6, copy of the policy schedule 2013-14 Ex.OP-7, copy of the policy schedule 2014-15 Ex.OP-8, copy of the policy schedule 2015-16 Ex.OP-9, copy of the policy schedule 2016-17 Ex.OP-10, copy of the claim form A Ex.OP-11, copy of the claim form B Ex.OP-12, copy of the request for cashless hospitalization Ex.OP-13, copy of the star medical officer sealed visit report Ex.OP-14, copy of the query on pre hospitalization Ex.OP-15, copy of the authorization for cashless treatment Ex.OP-16, copy of the rejection of pre authorization for cashless treatment Ex.OP-17, copy of the withdrawal of authorization letter Ex.OP-18, copy of the query reply Ex.OP-19, copy of the PET-CT report Ex.OP-20, copy of the outpatient card Ex.OP-21, copy of the CT Scan report Ex.OP-22, copy of the PET CT scan dt.2.7.2013 Ex.OP-23, copy of the history and examination chart Ex.OP-24, copy of the outpatient card dt.28.6.2013 Ex.OP-25, copy of outpatient card Ex.OP-26, copy of patient discharge summary Ex.OP-27, copy of the patient discharge summary Ex. OP-28, copy of repudiation of claim Ex. OP-29, copy of the material report on Takayasu Arteritis Medscape Ex. OP-30 and closed the evidence.

5        We have heard the Ld. counsel for the parties and have gone through the record on the file.

6        In the present complaint, the complainant has purchased cashless health insurance policy from the OP for himself as well as for his family members namely Seema Mahajan (wife), Mehak Mahajan, Tania Mahajan (daughters) and Nikhil Mahajan (son) under the plan of family health optima Insurance Policy. He has been purchasing this policy for his aforesaid family members since the year 2013 and continuously. The present current policy number P /2 /111111/ 01/  2017/ 002343 for the period valid from 30 July 2016 to midnight 19^th July 2017 for the insured amount of ₹4,15,000 with the premium of the total amount of ₹10,822 .

7        During the validity period of the current policy, the daughter of the complainant namely Mehak Mahajan suffered pain over her right hip with difficulty in walking as she had fallen from stairs on 06.11.2016 leading to injury over her right hip and remained admitted for her treatment of the said disease from 08.11.2016 to 12. 11.2016 in Amandeep Hospital, Amritsar. The OP had wrongly and illegally rejected the Pre-  Authorization from cashless treatment of the patient vide their reputation letter dated 9.11.2016 written to the hospital authorities,stated that “the patient is a known case of Takayasu Arteritis and post CVA- under regular treatment, including steroids . These conditions are pre existing and these have not been disclosed at the time of taking the policy ”. Hence Authorization given is withdrawn and the claim is rejected. Ops stated in their written version that the complainant’s daughter Mehak Mahajan admitted in Amandeep Hospital, Amritsar on 08.11.2016 for the treatment of Impacted # Neck Of Femur-Left and submitted pre  Authorization form for cashless treatment . On  perusal of the claim document it was observed :-

1. As per pre Authorization form, the insured was admitted with the complaints of pain and swelling left leg and the provisional diagnosis femur neck left .
2.  The treating doctor certificate states that the insured was fell down from the stairs at home on 06.11.2016 . Hence the cashless was authorized for Rs 20,000/- on 09.11.2016
3. Further during the field visit , it was observed that :-

•  the outpatient card dated 28.06.2013 of Nehru Hospital that the insured patient has undergone treatment for CVA (Left Hemiparesis) , Takayasu disease and also prescribed Tab. Ecosprin & Tab. Wyslone
• The CT scan report dated 27.06.2013 revealed Takaysu Arteritis .
• The PET CT report dated 02.07.2013 hypo metabolism in the right thalamus
• The history and examination chart dated 08.11.2016 states that the insured was old case of CVA on regular treatment and KCO Takaysu Arteritis.

8        From the above finding , it was observed that the insured had CVA prior to the policy inception and the same was not disclosed in the proposal form. At the time of inception of the policy which is from 13^th July 2013 to 12^th July 2014 the complainant had not disclosed the above mentioned medical history health details of the insured person in the proposal form which amounts to misrepresentation or non disclosure of material facts as per condition number 8 of the policy, if there is any misrepresentation or non disclosure of material facts whether by the insured person or any other person acting on his behalf of the company is not liable to make any payment in respect of any claim. Hence the claim was repudiated and the complainant was duly intimated in this regard with letter dated 16^th December 2016 as per clause number 15 of the policy, the company may cancel the policy on grounds of misrepresentation/ non disclosure of material facts as declared on proposal form at the time of claim hence the policy in respect of Mehak Mahajan stands cancelled with effect from 26th december 2016 due to non disclosure of PED- TAKAYASU ARTERITIS POST CEREBROVASCULAR ACCIDENT.

We have gone through pleading of the parties and perused the record and heard the argument of the learned counsel for the parties. There is no dispute between the parties that the complainant purchased the health insurance  policy from the OP , It is also not denied by the OP that the complainant daughter was hospitalized in Amandeep Hospital, Amritsar and undergone treatment for the period 08.11.2016 to 12.11.2016 . There is also no dispute regarding the expenses of treatment which were incurred by the respondent.

The only dispute between the parties are of pre-existing disease, that whether the respondent was suffering from the disease before the purchase of the policy for the period 13.07.2013 to 12.07.2014 and whether he concealed this fact at the time of purchase of the policy from the OP.

Ops had placed on record some evidence to prove their point that complainant’s daughter namely Mehak Mahajan , undergone treatment for CVA ( left Hemiparesis ) Takayasu disease which is prior to the inception of the medical insurance policy and hence it is a pre existing disease.

• Placed on record copy of the star medical officer sealed visit report ( Ex. OP 14) – stated that patient had a fall (self) at home 3years back and she was admitted in hospital but they referred her to PGI (CHANDIGARH) (Stated by her mother Seema Mahajan)
• Copy of PET-CT report (Ex.op 20) – report of Mehak Mahajan dated 02/07/2013.
• Copy of CT SCAN report (Ex.Op 22) – dated 27.06.2013
• Copy of the history and examination chat by Amandeep Hospital ( Ex.Op24) –clearly stated in past history as o/c/o CVA (left Hemiparesis) .

9        From the above findings it was observed that the insured had CVA prior to the policy inception and the same was not disclosed in the proposal form which amounts to misrepresentation or non disclosure of material fact. As such, the repudiation of claim is genuine and valid one and claim is not at all payable. In P.C. Chacko and Anr. Vs Chairman, Life Insurance Corporation of India and others AIR2008 SC 424, it is held that Non-disclosure and misstatement of material facts. The contracts of insurance including the contract of life assurance are contracts uberrima fides and every fact of material must be disclosed otherwise there is good ground for rescission of the contract.  In Satwant Kaur Sandhu Vs New India Assurance Company Ltd. (2009) 8SCC316 it is held that insured under obligation to make true and full disclosure of information within his knowledge. Mediclaim policy is a contract on utmost faith. Insurer is not liable to pay any amount as suppression of material facts established.

10      It is the fundamental principles of insurance law that utmost good faith must be observed by the contracting parties and good faith forbids either party from non – disclosure  of the facts which the parties known. Hence , considering all these facts supported by the hospital records, and after coming to the conclusion that the assured did not act promptly and intentionally suppressed the real facts and had violated the terms of the policy,the OP on valid grounds repudiated the policy and held that the claimant was not entitled for any benefits under the policy. There was no deficiency of service on the part of the Ops . It is well settled law that the health/ life insurance contract is based  on principal of utmost good faith “ Uberrima Fides” .

11      In view of above discussion, there is no merit in the present complaint and the same is hereby dismissed. The parties are left to bear their own costs. Copy of order will be supplied to the parties by the District Consumer Disputes Redressal Commission, Amritsar as per rules. File be sent back to the District Consumer Disputes Redressal Commission, Amritsar.

Announced in Open Commission

15.11.2022