Delhi

West Delhi

CC/14/445

Rattan Lal Raina - Complainant(s)

Versus

Star Health & Allied Ins. - Opp.Party(s)

Ashok Kumar

21 Apr 2022

ORDER

BEFORE THE CONSUME DISPUTE REDRESSAL FORUM,

WEST DISTRICT, JANAKPURI,

NEW DELHI

 

CC No.   445/2014

In re:-

Rattan Lal Raina

R/o Flat No.153, Pocket GH-13

Paschim Vihar

New Delhi-110087

                                                                              ………..Complainant

  

VERSUS

1.  M/s. Star Health & Allied Insurance Co. Ltd. &

          Branch Office

          Plot No.4, 3^rd floor, B Block

         Community Centre, Janak Puri

         New Delhi-110058

 

   2.   The Chairman & Managing Director

        M/s. Star Health & Allied Insurance Co. Ltd.

        1, New Tank Street

       Valluvar Kottam High Road, Nungambakkam

       Chennai-600034

 

3.    The Secretary

       Office of the Insurance Ombudsman

       (Delhi & Rajasthan)

      2/2A Universal Insurance Bldg.

      1^st floor, Asaf Ali Road

      New Delhi-110002                                                  .............   Opposite Party

 

 

Coram:                                                                             

1. SONICA MEHROTRA (PRESIDENT)
2. RICHA JINDAL (MEMBER)
3. ANIL KOUSHAL (MEMBER)

Date of Institution: 14.07.2014

Judgment reserved on:08.03.2022

          Date of Decision:21.04.2022

 

Order by – RICHA JINDAL (Member)

 

ORDER

1. The complainant has filed the present complaint against OPs u/s 12 of Consumer Protection Act, 1986. The facts as alleged in the complaint are that:-

 

1. The complainant is a law-abiding senior citizen of India, aged 74 years old and is a patient with heart aliments having stents in his arteries alongwith multiple health disorders.
2. The opposite parties are engaged in the profession/service of Health Insurance.
3. The complainant was a holder of OP Cashless Medi Claim Health Insurance Policy bearing No. P/161118/01/2011/00189, prosper’s code 779425 issue office code: 161118 branch office –Janakpuri, New Delhi under the name and style of Scheme “STAR SENIOR CITIZENS RED CARPET INSURANCE SCHEDULE”covering period 24/08/2010 to 23/08/2011 for sum insured Rs. 2,00,000/- on a premium of Rs. 9326/- paid by the complainant vide collection No. 1172002951 -14/08/2010.  Consequent upon getting and holding aforesaid health policy, the respondent No.1 company-issued policy to this effect enclosing schedule for company’s liability during the entire policy period in respect of the diseased/conditions is limited to the amount mentioned herein under :
   1. Name of the ailment/Surgery/procedure:  Cardio Vascular Diseases.
   2. Sub Limit for a sum insured of Rs.2,00,000/- Rs. 1,50,000/-
      1. It is made clear that the aforesaid policy under reference contained “STAR SENIOR CITIZEN RED CARPET INSURANCE POLICY” was a cashless facility to the insurer.
4. In December 2010 the complainant suffered unstable Angina pain and he was immediately got admitted to the Kalra Hospital on 29.12.2010 in the HeartCommand Unit after due examination his Angiographywas conducted on 29/12/2010. Subsequently, after stabilizing period an Angioplasty procedure was carried out on 04/01/2011 by placing the stent in his blocked artery. The OP was duly kept informed immediately after the hospitalization of the complainant in respect of his ailment and its development with regard to ongoing treatment inthe hospital. During hospitalization, the entire estimated/proposed expenses for the surgery and treatment were brought to the notice of the respondent company by the Kalra Hospital and asked for approval of expenses. In response, the respondent co. took the matter most callously and convey a sanction of a meagre amount of Rs. 40,000/- only again a total bill of Rs, 3,71,892/-. The attendant and spouse of the complainant had been making extraneous efforts to contact respondents co. officers/representatives on 7/01/2011 to release the balance amount of the insured sum i.e. Rs. 2,00,000/- but of no use. On 7/01/2011 the complainant was got discharged by the Kalra Hospital and they charged the total amount of Rs. 3,71,892/- for Angiography, Angioplasty and treatments including the cost of stents. Ultimately the hospital asked the complainant to deposit an amount of Rs. 3,31,892/- after adjustment of Rs. 40,000/- so remitted by the respondent company against the entire bill amount of Rs. 3,71,892/-, thus balance payment of hospital i.e. Rs. 3,31,892/- was arranged and paid to the hospital by the complainant.

 

5. Thereafter, the complainant sent a request letter to the respondent on 12/01/2011 followed by another reminder/letter dt. 25/02/2011 addressed to the Grievance Redressal Officer Star Health & Allied Insurance Co. Ltd., Chennai respectively to expedite the payment of his legitimate dues at the earliest. On 07/01/2011 i.e.the day of discharge of the complainant from the hospital, the respondent only remitted an amount of Rs. 40,000/- to the hospital against its total bill amount of Rs. 3,71,892/-.

 

6. The respondent further remitted an amount of Rs.52,735/- through cheque No. 744382 dt. 08/03/2011. It would be seen that since the complainant was holding Medi Claim Policy for an equal amount of Rs. 2,00,000/-whereas he received only short/part payment in piecemeal only Rs. 40,000/- and Rs.52,735/- totalling an amount of Rs. 92,735/-leaving balance of Rs.1,07,265/- being receivable amount from the respondent as of 07/01/2011. It is noted that the respondent co. themselves admitted as per terms and conditions of the present cashless Medi Claim Policy the company’s liability for Cardio Vascular Diseases is limited to Rs.1,50,000/- if the policy is issued for a sum insured of Rs. 2,00,000/- but the respondent company has disregarded and flouted the terms and conditions of its policy, thus violating its spirit.

 

7. The respondent rejected the claim bearing No. 80628 of the complainant under their letter dated 28/06/201 by giving vague, evasive and baseless reasons inserting a new hidden clause/word Co.pay which was nowhere highlighted/disclosed by the respondent at the time of taking policy and did not spell out in the terms and conditions of policy under reference. It is a mischievous and misleading act on behalf of the respondent company with the sole purpose to give mental tortures and harassment with financial loss to the policyholder, who is also Sr. Citizen and heart patient.

 

8. Being aggrieved from the rejection order of the respondent company dated 28/06/2011, the complainant approached the office of the InsuranceOmbudsman to vide his letter dated 12/09/2011 with the request for consideration of his case as per law and the insurer be advised to make the payment of entire insured sum and not to resort to Complainant –pay condition which was not a part of policy but of no use.

 

1. On 31/10/2021 the office of the Insurance Ombudsman passed an award dated 25/10/2012 being a full and final settlement of the complainant’s claim holding that the insurance company had settled the claim as per the terms and conditions of the policy, however, the entitlement of payment of post-hospitalization expenses of Rs. 5,143/- is found payable for which necessary directions were issued to the insurance company.
10. the complainant also got issued a legal notice dtd 01/07/2013 and the same was served upon the respondents but they did not bother to comply with the same.  However, the office of the Insurance Ombudsman sent a vague and evasive stereotype reply to the notice of the complainant dated 01/07/2013 through the administrative Officer, vide his letter of 14.08.2013 rejecting the complainant's claims and retreating /cofiring their earlier award dated 25/10/2013.

 

11. Due to the deficiency in service on the part of the opposite parties/respondents the complainant has suffered immense mental pain agon and torture for which the respondents are liable to compensate the complainant.
12. The reasons and the facts submitted above, the instant complaint of the complainantwith arequest to passan order in favour of the complainant and against the respondents/opposite parties as prayed for in the interest of justice equity and fair play.

2.     Accordingly, a court notice was issued to the OPs on 22-07-2014 and thereafter on 18/09/2014. OP’s appeared and filed a written statement on 08/01/2015, wherein they took the following defences:-

1. The complaint filed by the complainant is false, frivolous, vague and baseless and misconceived because there was/is no deficiency in service on the part of the opposite party.
2. The present complaint is barred under Section 26 of the Consumer Protection Act which is as under.
   1. Dismissal of frivolous or vexatious complaints:  where a complaint instituted before the District Forum,the State Commission or as the case may be the national Commission is found to be frivolous or vexatious.  It shall, for reasons to be recorded in writing, dismiss the complaint and make an order that the complainant shall pay to the opposite party such cost, not exceeding ten thousand rupees as may be specified in the order.

 

3. The deponent says that the branch office of the opposite party had issued the policies P161118/01/2010/000957 and P/16118/01/2011/001899 for the period 24.08.2009 to 23.08.2010 and 24.08.2010, 23.08.2011respectively covering Mr Rattan lal Raina for the sum insured of Rs. 2,00,000 under our Senior Citizen Red Carpet Insurance Policy.

 

4. The opposite party have received the claim of Mr Rattan Lal Raina for the treatment of unstable Angina at Kalra Hospital, SRCNC, New Delhi and the date of admission is 28.10.2010 and discharged on 07.01.2011 and submitted the bill for Rs. 3,77,305.

 

5. The opposite party have received a Pre-authorization request from the Kalra Hospital SRCNC New Delhi. The claim has been evaluated by our in-house medical officers and has been authorised for Rs.40,000/- on the basis of availablerecords and we have informed the same hospital as well as the insured vide letter dated 05.01.2011.

 

6. The opposite party had advised the insured to submit the treatment records along with the claim form for the evaluation of the same by our medical experts for the balance eligibility. Accordingly, the insured has submitted the claim form and hospital records. We have scrutinized the documents and settled the claim for Rs.52,735/-.

 

7. That the liability works out as follows:

	Nature of expending	Amount claimed		Disallowed	Amount approved		Reason for deduction
	ICU Roomrent 4 days						2% of sum insured (Rs.4000 4 condition (A)
	Room rent 6 days						1% of sum insured (Rs.2000 6 condition (A)
	Surgeon charges coronary angiography						80% charges applicable condition NO.14
	Professional						Item 3+4 25% of sum insured max payable condition (D)
	Investigation						50% if the sum insured under condition (E)   1 reasonable and necessary charge only payable   Non-medicines not payable
	Investigation
	Investigation
	Others
	Others
	Coronary Baloon charges
	Stent  charges
	Stent charges
	Medicine
	Eligible amount
	50% copay						As per execution No.5 50% of each and every claim arising out of allpre-existing diseases as defined and 30% in case of all other claims which are to be borne by the insured

 

8. That the amounts of settlement details are as follows:-

 

Rs. 40,000/- cashless (Vide DD 728965/14.02.2021)

Rs52735/- reimbursement (Vide DD 744382/19/92/2911)

 

1. The opposite party has provided the detailed working sheet alongwith its settlement letter. As such opposite party have accepted liability in terms of cover.  The above-related charges are forming the difference against the total claim preferred by the insured based on the working of the acceptance of the claim by our medical team. The opposite party had considered the claim and settled in terms of the policy.

j     The insured also approached the Hon’ble Ombudsman. Delhi for the balance amount. The opposite party have taken the same before the Hon’ble Ombudsman. After due consideration of the matter the office of the Ombudsman, in its award dated 25.10.2012 had upheld the settlement of the claim as valid and confirmed that the claim was settled as per the terms and conditions of the policy as regards the hospitalization bill and also ordered to pay an amount of Rs. 5143/- towards post hospitalization bills of the insured as it is not submitted by the insured earlier. The opposite party have settled the same vide cheque No. 346888 dated 21.11.2012.

11. The complainant has not come with clean hands and has suppressed the material facts from this Hon’ble Forum. No cause of action ever arose in favour of the complainant and against the respondent for filing the present complaint. Thus the complaint is liable to be rejected/dismissed with heavy costs.
12. The complainant has indulged himself in speculative litigation and adventurism taking undue advantage of the fact that no court fee is payable under the Consumer Protection Act.  Which is an abuse of benevolent provisions of law.  Hence the complaint is liable to be dismissed on this ground as well.

 

3. The complainant has filed a rejoinder on 28/05/2015 and the matter was adjourned for evidence of both parties for 19/08/2015.

 

4. Thereafter on 19/08/2015, the complainant filed their affidavit in evidence testifying to all the facts stated in the complaint along with documents exhibit CW-1/1 to CW- 1/12. whereas Sh. Rajnish Kohli, Assistant Vice President, claimsM/S Star Health and Allied Insurance Co. Ltd. has filed his affidavit in evidence on behalf of the respondent.

 

5. The Complainant has filed Written submissions on 6/11/2015. Whereas written arguments have also been filed by opposite parties on 05/01/2016. Finally, oral arguments of both parties were heard on 08/03/2022 and the order was reserved.

 

6. During the arguments learned counsel for the complainant has further argued that the terms and conditions of the Insurance Policy were never communicated to the insured persons nor were they supplied with a copy of the Insurance Policy.

 

7. During the arguments, counsel for OP relied on the following judgements :

• National Commission, the order in revision petition No. 4678 of 2009 titled as Satish Kumar Versus Branch Manager Life Insurance Corporation of India
• National Commission order in Revision Petition NO. 610 of 2012 titled as Max New York Life Insurance Complainant. Ltd vs Mr Amaresh Reddy
• Satwant Kumar Sandhu vs New India Assurance Co. Ltd.

(2009) 8 SCC 315

-       PC Chacko and Anr. Vs. Chairman Life Insurance Corporation of India and Others (2008)1 SCC 321

8. The controversy in the present case is as to whether the complainant is entitled to the claim amount or not. The factual position is not in dispute and OP categorically admitted the issuance of policy in the present case also  treatment given to the complainant and the period of admission is  not in dispute. The only issue raised by the OP is that the complainant was suffering                from a pre-existing disease at the time of issuance of the policy, therefore, his claim was hit by clause 5 of exclusion under terms and conditions of Star Senior Citizen’s Red Carpet Insurance Policy which states that:-

“ 50 % of each and every claim arising out of all pre-existing disease as defined and 30 % in case of all other claims which are to be borne by the insured.”

 

9. First of all, we need to specify  that the terms and conditions being relied upon by the OP should form part and parcel of the Insurance policy docket sent/issued to the insured (complainant  herein) but in the present case terms and condition which is a separate full-fledged explanatory document that was intentionally kept under wraps by OP to take defence of only when the claim shall be filed before it. It is now well-settled law that terms and conditions of contract cannot be pressed into service unless and until the same is duly supplied to the insured at the time of inception of the contract of insurance. Apparently  this condition has not been complied with by OP.

 

10. 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 lads which the parties knew. The insured must disclose and similarly,the insurance company and its agents must disclose ill material facts in their knowledge since the obligation of good faith applies to both equally.

 

11. On this issue, we are guided by the Hon’ble Apex court in the case of M/S Modern Insulators Ltd vs The Oriental Insurance Co. Ltd reported in(2000) 2 SCC 734, where the following order has been passed.

 

• “As the above terms and conditions of the standard policy wherein the exclusion clause were 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.”

<>12.Further In "Bharat Watch Company vs. National Insurance Co. Ltd. [2019 (6) SCC 212] (supra)", the Hon'ble Supreme 

Court has held as follows:-

" The basic issue which has been canvassed on behalf of the appellant before this Court is that the conditions of exclusion under

the policy document were not handed over to the appellant by the insurer and in the absence of the appellant being made aware of the terms of the exclusion, it is not open to the insurer to rely upon the exclusionary clauses.”

<>13.Suraj Mal Ram Niwas Oil Mills (P) Ltd. vs. United India Insurance Company [IV (2010) CPJ 38 (SC)];

“the terms of a contract of insurance, the words used therein must be given paramount importance, and it is not open

 for the Court to add, delete or substitute any words. It is also well settled that since upon issuance of an 

insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks c

overed by the policy, its terms have to be strictly construed to determine the extent of liability of the insurer.

 Therefore, the endeavour of the court should always be to interpret the words in which the contract is expressed 

by the parties.”

<>14.Further Hon’ble NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION  NEW DELHI in CONSUMER 

CASE NO. 1094 OF 2018 titled as M/S. ANJANEYA JEWELLERY vs NEW INDIA ASSURANCE CO. LTD. & ORS. 

Decided on 21/09/2021 held that 



 “ From the discussions of Hon’ble Supreme Court, two principals emerged as follows:

 

(i)     There is no difference between a contract of Insurance and any other Contract, and it should be construed strictly without adding or deleting anything from the terms thereof.

 

(ii)    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 must disclose and similarly,the insurance company and its agents must disclose all material facts in their knowledge since the obligation of good faith applies to both equally.  If the above terms and conditions of the standard policy wherein the exclusion clause were included, were neither a part of the contract of insurance nor disclosed to the Insured, the Insurance Company cannot claim the benefit of the said Exclusion Clause.

 

15. Applying the Principles laid down by the Hon'ble Supreme Court referred to above, to the facts of the present case, we find that there is no material on record to establish that the Opposite Party Insurance Company had given the Terms and Conditions of the Star Senior Citizen’s Red Carpet Insurance Policy or at any point of time or ever informed the Complainant about the same. Thus, the Exclusion Clause based on which the Opposite Party Insurance Company had repudiated the Insurance Claim of the Complainant, cannot be sustained as the Opposite Party Insurance Company could not rely upon the same”

 

16. The Hon’ble Supreme Court in its recent judgments titled  “Oriental Insurance Co Ltd.vs. Mahendra Construction = (2019) 18 SCC 1 357 and LIC of India vs Smt.   G. M. Channabasamma (1991) 1 SCC 357 held that

“ For an insurer to repudiate the policy it must establish suppression or misrepresentation of material facts on the part of the

insured “.

 

17. It was the specific contention of the complainant that the exclusionary conditions in the policy document had not been communicated by the insurer as a result of which the terms and conditions of the exclusion were never communicated. The fact that there was a contract of insurance is not in dispute and has never been in dispute. Hence the only issue is whether the exclusionary conditions were communicated to the complainant or not and since the insurer did not furnish the terms and conditions of the exclusion and special conditions to the complainant and hence, they were not binding. 

 

18. 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 lads which the parties knew. The insured must disclose and similarly,the insurance company and its agents must disclose ill material facts in their knowledge since the obligation of good faith applies to both equally as guided by the Hon’ble Apex court in the case of M/S Modern Insulators Ltd vs The Oriental Insurance Co. Ltdreported in (2000) 2 SCC 734. Which states that

 

  “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 lads which the parties knew. The insured must disclose and similarly,the insurance company and its agents must disclose all material facts in their knowledge since the obligation of good faith applies to both equally.”

 

19. We also relied on another judgment of the Supreme Court in United India Insurance Company Limited v. M.K.J. Corporation reported in (1996) 6 SCC 428. The Supreme Court held as follows:

"It is a fundamental principle of Insurance Law that utmost good faith must be observed by the contracting parties. Good faith forbids either party from concealing (non-disclosure) what he privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. Just as the insured must disclose, "similarly, the insurers and their agents must disclose all material facts within their knowledge, since the obligation of good faith applies to them equally with the assured.

 

The duty of good faith is of a continuing nature. After the completion of the contract, no material alteration can be made in its terms except by mutual consent. The materiality of a fact is judged by the circumstances existing at the time when the contract is concluded.”

Applying the Principles laid down by the Hon'ble Supreme Court referred to above, to the facts of the present case, we find that there is no material on record to establish that the Opposite Party Insurance Company had given the Terms and Conditions of the Star Senior Citizen’s Red Carpet Insurance Policy or at any point of time or ever informed the Complainant about the same. Thus, the Exclusion Clause based on which the Opposite Party Insurance Company had repudiated the Insurance Claim of the Complainant, cannot be sustained as the Opposite Party Insurance Company could not rely upon the same”

 

13. Keeping in view the circumstances and reasons stated above, since the Opposite party failed to prove on record that they supplied terms and conditions of the Star Senior Citizen’s Red Carpet Insurance Policy to the complaint with the insurance policy. Admittedly the terms and conditions mentioned in the Star Senior Citizen’s Red Carpet Insurance Policy areConsequent upon getting and holding the aforesaid health policy, the respondent No.1 company-issued policy to this effect enclosing schedule for company’s liability during the entire policy period in respect of the diseased/conditions is limited to the amount mentioned herein under :
    1. Name of the ailment/Surgery/procedure:  Cardio Vascular Diseases.
    2. Sub Limit for a sum insured of Rs.2,00,000/- Rs. 1,50,000/-

 

20. Admittedly the opposite party remitted an amount of Rs. 40,000/- and Rs.52,735/- and Rs 5,143/- totalling an amount of Rs. 97,878/-leaving balance of Rs. 52,122/- being receivable amount from the respondent. It is noted that the OPS themselves admitted as per terms and conditions of the present cashless Medi Claim Policy the company’s liability for Cardio Vascular Diseases is limited to Rs.1,50,000/- if the policy is issued for a sum insured of Rs. 2,00,000/-, but the respondent company has disregarded and flouted the terms and conditions of its policy, thus violating its spirit.We believe that the part settlement of the claim of the complainant was highly unjustified, unwarranted and unfounded. Non-settlement of the claim of the complainant is a clear case of deficiency in service on the part of the respondents as per the Consumer Protection Act.

24.   Therefore, we allow the complaint of the complainant and it is directed that:-

(i)        The OPs will pay a sum of Rs. 52,122/- (being the remaining sum insured of the policy)to the complainant within 30 days from the date of this order.

(ii)        The OPs will pay interest @ 9% p.a. on the above amount of Rs.52,122/- from the date of filing of the complaint i.e.2/07/2014 till realization.

(iii)       The OPs will also pay a sum of Rs.10,000/- (Rupees Ten Thousand) towards the cost of litigation to the complainant.

4.      The OPs will also pay a sum of Rs.15,000/- towards harassment mental agony loss of time to the complainant.

 

25. Let the order be complied with by OPs within 30 days from the date of receipt of the copy of this order.
26. Let a copy of this order be sent to each party free of cost as per Regulation 21 of the Consumer Protection Regulations.
27. File be consigned to record room.
28. Announced on 21/04/2022

 

 

(Richa Jindal)         Member

(Anil Kumar Koushal)               Member

(Sonica Mehrotra)                         President