DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KOZHIKODE
PRESENT: Sri. P.C. PAULACHEN, M.Com, LLB : PRESIDENT
Smt. PRIYA.S, BAL, LLB, MBA (HRM) : MEMBER
Sri.V. BALAKRISHNAN, M Tech, MBA, LL.B, FIE: MEMBER
Friday the 25th day of August 2023
C.C.225/2021
Complainant
A. Firoz Khan, Dy. Collector (RETD),
2/1020, Jesna, Rupublic Road,
P.O. Eranhipalam, Kozhikode-673006.
Opposite Parties
- Star Health and Insurance Allied Insurance co. Ltd,
4th floor, Carmel Towers,
Cotton hill P.O, Vazhuthakkad,
Trivandrum -695014
(By. Adv. Sri. Rajesh.E)
- Star Health and Insurance Allied Insurance co. Ltd,
Branch Office, IInd Floor,
Shobha Tower, Mavoor Road,
Kozhikode-673 004
ORDER
By Sri. P.C. PAULACHEN – PRESIDENT
This is a complaint filed under Section 35 of the Consumer Protection Act, 2019.
2. The case of the complainant, in brief, is as follows:
The complainant had availed a Medi Classic Insurance Policy from the opposite parties on 31-05-2013 covering his wife and daughter and had got it renewed every year. On 25-08-2021 the complainant’s wife Mrs. Subaida Firoz was admitted in Meitra Hospital, Kozhikode due to knee pain and she underwent total knee replacement left on 26-08-2021 and was discharged on 28-08-2021. The sum insured in respect of Mrs. Subaida Firoz was Rs.3,00,000/-. The total medical treatment expenses amounted to Rs.2,58,608/-. The hospital authorities had forwarded the final bill and the relevant documents to the insurance company. But only an amount of Rs.67,500/- was approved and sanctioned by the opposite parties. The complainant managed to arrange the balance amount from his relatives and remitted in the hospital and the patient was discharged late in the night. The action of the opposite parties in not sanctioning the claim in full is illegal and unjustified.
On 08-09-2021 he issued a letter to the opposite parties demanding detailed statement. But the opposite parties did not furnish the statement and after long delay an evasive reply was given. The reason stated for limiting the claim is that it was a robotic surgery. There is no justification for limiting the amount on that ground. The insurance company is bound to inform the changes, if any, in the policy conditions whenever the policy is renewed. He had to remit an amount of Rs.1,91,108/- in the hospital for getting discharge. In addition to that, he had to pay Rs.7,907/- for medicines for the pre-admission period and post-discharge period. Hence the complaint claiming a total amount of Rs.1,99,015/- from the opposite parties.
4. The opposite partiesresisted the complaint by filing written version jointly wherein they have denied all the allegations and claimsmade against them in the complaint. The policy is admitted by the opposite parties. According to the opposite parties, at the time of issuing the policy, the complainant had been supplied with the terms and conditions of the policy. The terms and conditions of the policy were explained to the complainant at the time of proposing the policy. The opposite parties had received a pre-authorization request for cashless treatment from Meitra Hospital, Kozhikode stating that the complainant’s wife was admitted in the hospital on 25-08-2021 and was provisionally diagnosed with Stage 4 Osteoarthritis knee left. Thereafter the hospital had forwarded the discharge summary along with final bill of Rs.2,58,608/-. The procedure underwent in the hospital was robotic total knee replacement.
- As per Coverage for Modern Treatment, coverage clause j of the terms and conditions of the policy, the expenses payable during the entire policy period for robotic surgeries is limited to Rs.75,000/- for a sum insured of Rs.3,00,000/-. As per clause 6 (Important Note) under coverage clause, the policy is subject to co-payment of 10% of each and every claim amount, if the insured persons are aged above 60. Thus after deducting 10% from the admissible amount of Rs.75,000/-, the opposite parties approved an amount of Rs.67,500/- and informed the hospital accordingly. The opposite parties are not liable to pay any further amount. The complaint has been filed with the intention to harass the opposite parties and to get unlawful enrichment. It is, therefore, prayed to dismiss the complaint with costs.
6. The points that arise for determination in this complaint are:
- Whether there was any deficiency of service on the part of the opposite parties, as alleged?
- What, if any, is the legitimate dues payable to the complainant?
- Reliefs and costs.
Evidence consists of the oral evidence of PW1 and Exts A1 to A10 on the side of the complainant. RW1 was examined and Exts B1 to B4 were marked on the side of the opposite parties.
8. Heard both sides.
Points 1 and 2:– These points can be considered together for the sake of convenience. The complainant has approached this Commission with a grievance that the claim put in by him in connection with the treatment of his wife Subaida Firoz was only partially allowed by the insurance company and the remaining claim was not sanctioned without any valid reason and thereby there was deficiency of service on the part of the Insurance Company.
The complainant is the holder of Ext A2 Medi classic Insurance Policy. The above policy covers the health insurance for the complainant’s wife and daughter. The said insurance cover has been in force since 31-05-2013 and it has been renewed up to 11-06-2022. On 25-08-2021 the complainant’s wife was admitted in the Meitra Hospital, Kozhikode with diagnosis of Stage 4 Osteoarthritis knee left. The procedure done in the hospital was robotic (Smith & Nephew Real Intelligence CORI) total knee replacement left. She was discharged on 28-08-2021. Ext A1 is the discharge summary. On 25-08-2021 a pre-authorization request for cashless treatment was sent to the Insurance Company from the hospital. The total bill amount was Rs.2,58,608/-. Ext A7 is the inpatient bill (summary). The claim was partially allowed by the opposite parties by sanctioning Rs.67,500/-. Ext A9 is the cashless authorization letter issued by the Insurance Company. There is no serious dispute on the above aspects.
- The dispute is with regard to the balance amount of Rs.1,91,108/- (Rs.2,58,608 – 67,500) and Rs.7,907/- pertaining to the bills for the pre-admission period and post-discharge period. In order to substantiate his case, the complainant got himself examined as PW1, who has filed proof affidavit and deposed in terms of the averments in the complaint and in support of the claim. PW1 has asserted that the terms and conditions of the policy were neither furnished nor informed to him. PW1 has categorically stated that before the renewal of the policy, he was not informed of the policy terms and conditions limiting the claim for robotic surgeries to Rs.75,000/-. The stand taken by him is that the terms and conditions were produced by the insurance company only along with the proof affidavit filed by RW1. Ext A3 is the copy of the letter dated 08-09-2021, Ext A4 is the copy of the bill assessment sheet – Hospital payment, Ext A5 is the medical certificate dated 07-12-2022, Ext A6 is the copy of the news item in the Mathrubhumi daily, Ext A8 is the deposit receipt and Ext A10 is the copy of the letter dated 30-09-2021.
The Assistant Manager (Legal) of the Insurance Company was examined as RW1 and he has deposed supporting and reiterating the contentions in the version and maintained that the terms and conditions of the policy were explained to the complainant at the time of proposing the policy and was served to him along with the policy schedule. According to RW1, the policy is subjected to co-payment and limits as per the terms and conditions of the policy. According to him, the expenses payable during the entire policy period for robotic surgeries is limited to Rs.75,000/- for a sum insured of Rs.3,00,000/- and further the policy is subject to co-payment of 10% if the insured is aged above 60 and thus after deducting 10% from the admissible amount of Rs.75,000/-, the amount payable was only Rs.67,500/- and no further amount is payable to the complainant.Ext B1 is the copy of the policy schedule and conditions, Ext B2 is the copy of the request for cashless hospitalization from Meitra Hospital, Ext B3 is the copy of the discharge summary and bill and Ext B4 is the copy of the authorization letter.
As per Ext A2, the sum insured is Rs.3,00,000/- as far as Mrs. Subaida Firoz is concerned. Ext A7 bill is for Rs.2,58,608/- . The amount authorized by the insurance company as per Ext A9 is Rs.67,500/-. The stand of the opposite parties is that as per Modern Treatment Coverage clause j of the terms and conditions of the policy, the expenses payable for robotic surgery is limited to Rs.75,000/- and that as per clause 6 under coverage clause, the policy is subject to co-payment of 10% of each and every claim amount, as the insured is aged above 60. Now the cardinal point to be considered is as to whether the non- payment of the balance amount because of the co-payment and limits as per the terms and conditions is justified in this case. The definite case of PW1 is that he was given Ext A2 policy schedule containing 4 pages only and the above conditions of the policy were not furnished or explained to him and he was totally unaware of the same and his wife underwent the surgery under the bonafide belief that the entire amountwould be reimbursed. PW1 has asserted that the terms and conditions were first seen by him when the same was produced along with the proof affidavit filed by RW1. There is absolutely no reason to disbelieve PW1 in this regard. Even though PW1 was subjected to searching cross examination, nothing has been brought out to discredit his version. It is the duty of the Insurance Company to disclose the terms and conditions of the policy to the insured and furnish the same to him.
RW1 has produced before this Commission the policy schedule along with the conditions of the policy which is marked as Ext B1. There is absolutely nothing in evidence to hold that the above terms and conditions were furnished to the complainant or explained to him. Ext A2 shows that the insurance company is liable to pay all medical expenses incurred by the insurer during the period of the policy up to Rs.3,00,000/-. Since the clause regarding co-payment, the limits regarding robotic surgery etc. were neither supplied nor explained to the insured, the same is not binding on him.
15. In Modern Insulators Ltd vs. Oriental Insurance Co. Ltd. (2000)2 Supreme Court cases 734, the Hon’ble Supreme Court has held that the non-disclosure of the terms and conditions is violation of utmost good faith which is the base of insurance contract. In paragraphs 8 and 9 of the aforesaid decision, it has been held as follows:
“It is the fundamental principle 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 know.The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose all material facts in their knowledge since obligation of good faith applies to both equally.
In view of the above settled position of law we are of the opinion that the view expressed by the National Commission is not correct. As the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant respondent cannot claim the benefit of the said exclusion clause. Therefore the finding of the National Commission is untenable in law”
16. In order dated 01/12/2014 in Revision Petition No.3934/2013 (Bajaj Allianz General Insurance Company Ltd. And another vs. Achala Rudranwas Marde) the Hon’ble National Consumer Disputes Redressal Commission has held that non-disclosure of the terms and conditions is violation of utmost good faith which is the base of insurance contract between the parties.If such exclusion clause etc. are not explainedor furnished to the insured, the same is not binding on him. The decision of the Hon’ble Supreme Court in Modern Insulators Ltd vs. Oriental Insurance Co,. Ltd, was relied upon in the above decision of the Hon’ble National Consumer Disputes Redressal Commission.
The complainant has been in regular payment of the insurance premium and renewal of the policy from 2013 onwards without any default. The Hon’ble Apex Court in 2021 (0) Supreme (SC) 779- (Manmohan Nanda V/s United India Insurance Company Limited) has observed as follows; (Para 69)
“The object of seeking a medi claim policy is to seek indemnification in respect of a sudden illness or sickness which is not expected or imminent and which may occur overseas. If the insured suffers a sudden sickness or ailment which is not expressly excluded under the policy, a duty is cast on the insurer to indemnify the appellant for the expenses incurred thereunder.”
- The dictum in the above referred decisions is squarely applicable in this case. The terms and conditions of the policy wherein the co-payment clause and limit for modern treatment etc. were included were neither a part of the contract of insurance nor disclosed to the complainant herein and therefore the benefit of the said clause cannot be claimed by the Insurance Company. The conduct and attitude of the opposite parties including the non-disclosure of the terms and conditions to the insured at the proper time and denying the legitimate claim, undoubtedly amounts to gross deficiency of service. The sum insured is Rs.3,00,000/-. The final bill amount is Rs.2,58,608/- and the amount already paid by the insurance company is Rs.67,500/-. So the legitimate dues to the insured is Rs.1,91,108/-. The opposite parties are liable to pay the said amount to the complainant. The claim for Rs.7,907/- is not coming under the inpatient treatment and it pertains to pre-admission period and post-discharge period and hence not allowed.
19. Point No.3 :In the light of the finding on the above points, the complaint is disposed of as follows:
- CC 225/2021 is allowed in part.
- The opposite parties are hereby directed to pay an amount of Rs.1,91,108/-(Rupees one lakh ninety one thousand one hundred and eight only) to the complainant.
- The payment as aforestated shall be made within 30 days of the receipt of copy of this order, failing which, the amount of Rs.1,91,108/- shall carry an interest of 6% per annum from the date of this order till actual payment.
- No order as to costs.
Pronounced in open Commission on this the 25th day of August 2023.
Date of Filing: 18-12-2021.
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PRESIDENT MEMBER MEMBER
APPENDIX
Exhibits for the Complainant :
Ext A1 - Discharge summary.
Ext A2 - Medi classic Insurance Policy.
Ext A3 - Copy of the letter dated 08-09-2021.
Ext A4 - Copy of the bill assessment sheet – Hospital payment.
Ext A5 - Medical certificate dated 07-12-2022.
Ext A6 - Copy of the news item in the Mathrubhumi daily.
Ext A7 - Inpatient bill (summary).
Ext A8 - Deposit receipt.
Ext A9 - Cashless authorization letter issued by the Insurance Company.
Ext A10 - Copy of the letter dated 30-09-2021.
Exhibits for the Opposite Parties:
Ext B1 - Copy of the policy schedule and conditions.
Ext B2 - Copy of the request for cashless hospitalization from Meitra Hospital.
Ext B3 - Copy of the discharge summary and bill.
Ext B4 - Copy of the authorization letter.
Witness for the Complainant
PW1 – A. Firoz Khan - (Complainant)
Witnesses for the opposite parties
RW1 – Balu.M.
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PRESIDENT MEMBER MEMBER
True copy,
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Assistant Registrar.
