BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE URBAN

    22^nd DAY OF MAY 2019

O R D E R

SRI. S.L PATIL, PRESIDENT

The complainant has filed this complaint U/s.12 of the Consumer Protection Act, 1986 against the Opposite Party (herein after referred as OP) with a prayer to direct the OP to pay a sum of Rs.7,70,000/- with interest @ 18%, to award compensation of Rs.5,00,000/- for mental agony and hardship suffered by the complainant due to non payment by the OP, to award legal cost of the proceedings and such other reliefs.

2. The brief allegations made in the complaint are as under:

That the complainant’s father late A.C Fernandes was insured under the OPs ‘Group Mediclaim Tailormade Policy’ obtained by Front Avenue Infosolutions Pvt. Ltd., for the year 2016-17 vide policy bearing No.P/141123/01/2016/013744 for the period 30.01.2016 to 29.01.2017 for a sum of Rs.4,00,000/- and for the year 2017-18 vide policy No.P/141123/01/2017/014007 for a period 30.01.2017 to 29.01.2018 for a sum of Rs.8,00,000/-.  That the complainant father was admitted to Vinaya Hospital & Research Center, Mangalore for treatment on 2^nd January 2017, but sadly due to severe multi organs failure could not recover from the illness and expired on 27^th February 2017 in the said hospital.  That the complainant’s father was inpatient in the hospital from 02.01.2017 till 27.02.2017 and was insured under the ‘Group Mediclaim Tailormade Policy’ of the OP.  That out of the total bill of Rs.12,73,530/- raised by the hospital for the hospitalization of complainant’s father even though    he was fully covered under   the “Group Mediclaim Tailormade Policy’, to the astonishment of the complainant, the OP paid only a sum of Rs.1,28,068/- out of the total bill of Rs.12,73,530/- by way of cashless claim settlement.  That on enquiry by the complainant, the OP informed the complainant that the remaining sum insured for the year 2016-17 has been paid by cashless claim settlement and requested the complainant to seek reimbursement of the remaining amount from the sum insured for the year 2017-18, since the policy was renewed/continued for the year 2017-2018.

That the complainant with the bonafide belief raised the claim bearing No.2018/0006907 for reimbursement of the remaining amount of Rs.8,00,000/- which is the sum insured by submitting all the bills, but to the utter shock and surprise of the complainant, the OP vide letter dated 13.04.2017, intimated that the balance amount claimed cannot be considered since the date of admission was during the policy period commencing from 30^th January 2016 to 29^th January 2017 and the balance amount cannot be claimed under the renewed policy and in continuation the OP issued a letter dated 29.05.2017 enclosing the settlement details which indicated that maximum sum of Rs.1,28,069/- was paid sum insured exhausted for the policy period 2016-17.  That the complainant being shell shocked to receive the said letter intimating the rejection of the claim on flimsy ground by the OP, raised grievance with the Grievance Cell of the OP and in response the grievance cell of the OP informed the complainant that they have advised the claims department to review the claim of the complainant.  The complainant did not receive any communication from OP inspite of several mails being sent to the OP.  That since the OP did not address the grievance of the complainant, the complainant filed complaint before the Ombudsman.  Complainant further issued legal notice dated 13^th June 2018 calling upon the OP to reimburse the claim amount.  The said notice was served on the OP on 15^th June 2018.  That in response the OP has not replied to the legal notice nor settled the claim amount.  That in the intervening period the Ombudsman has passed an erroneous award directing the OP to pay an additional sum of only Rs.30,000/- along with 9.75%.  The said amount was paid by the OP and the complainant has received the said amount under protest subject to realization of the claim amount.

That OP vide letter dated 14.08.2018 has certified that Late A.C Fernandes is covered under the Group Mediclaim Tailor Made Policy for a sum insured of Rs.8,00,000/- for the policy period 30^th January 2017 to 29^th January 2018 and the claim has been settled for Rs.30,000/-.  That out of the total bill of Rs.12,73,530/- the OP has paid only Rs.1,58,068/- i.e., Rs.1,28,069/- from the policy period 2016-17 and Rs.30,000/- from the policy period 2017-18.  That the total sum insured for the policy period 2017-18 is Rs.8,00,000/- and out of which a sum of Rs.30,000/- has been paid by the OP.  The OP is liable to pay the balance sum insured of Rs.7,70,000/- towards hospitalization charges.  That since the OP has failed to reimburse the claim amount, the complainant having no other remedy have approached this Forum seeking the relief as prayed for in the complaint.  Hence this complaint.

3. After issuance of notice, OP filed version denying the allegations made by the complainant.  The sum and substance of the contents of the version are, the complaint is not maintainable either in law or on facts and is liable to be dismissed in limine.  The complaint is based on self – serving and misleading allegations without proper disclosure of facts.  The claim is not maintainable.  The complainant may be called upon to prove that he is entitled to file the present complaint, maintain the same as against the OP.  The complaint is totally misconceived and is based on erroneous assumptions of facts and in law while making the complaint.  The policy issued is subject to various terms, conditions, exceptions, limitations thereof.  The present complaint is false, vexatious and is aimed to harass the insurer, which is a private sector Insurance Company Ltd., who is the custodian of public funds.  OP being issued Group Mediclaim Tailormade Policy having obtained by Front Avenue Infosolutions Pvt. Ltd., for the year 30.01.2015 to 29.01.2016 for sum assured of Rs.4,00,000/-, policy for the period between 30.01.2016 to 29.01.2017, for sum assured of Rs.4,00,000/-, policy for the period between 30.01.2017 to 29.01.2018 for sum assured of Rs.8,00,000/- for reimbursement of medical expenses for the employee and family members of Front Avenue Infosolutions Pvt. Ltd.

That the policy is contractual in nature and the claims arising therein are subject to the terms and conditions forming part of the policy.  The terms and conditions of the policy specially states that the insurance company is not liable to pay in respect of any claim, if there is any misrepresentation and non disclosure of material fact by the insured to the insurer.  The complainant has accepted the policy agreeing and being fully aware of such terms and conditions and executed the proposal form.  That the complainant/insured has reported 5 claims in the 2^nd year of Medical insurance policy from inception.

1. CLI/2017/141123/0268008 – Opposite party settled an amount of Rs.89,300/-.

2.  CLI/2017/141123/0358034 – Opposite party settled an amount of Rs.32,631/-.

3. CLI/2017/141123/0360287 – Opposite party settled an amount of Rs.1,20,000/-.

4. CLI/2017/141123/0366120 – Opposite party settled an amount of Rs.1,28,069/-.

As per the claim form and complaint the complainant has claimed an amount of Rs.8,00.000/- during reimbursement of medical expenses from the OP as prayed for in the complaint is not sustained in law or facts of the case.  Hence the complaint may be dismissed with costs.  That the complainant/insured father A.C Fernandes was admitted in Vinay Hospital and Research Centre ( A Unit of KIMC), Mangalore on 02.01.2017 and due to illness and expired on 27.02.2017.  That as per the death summary the deceased/insured was diagnosed as DM (Diabetes Mellitus) + HT (Hypertension) + CKD (Chronic Kidney Disease) + L Heel Ulcer with Gangrene with Sepsis.

The insured submitted the claim form and claimed an amount of Rs.12,73,530/- during reimbursement of medical expenses.  The insured has submitted the latest claim document along with claim form with documents on 15.03.2017.  That the insured/complainant had submitted a claim under renewed policy No.P/141123/01/2017/014007 i.e., policy period 30.01.2017 to 29.01.2018 seeking reimbursement for expenses incurred for the above referred hospitalization.  On scrutiny of the claim records, it is observed that the date of admission falls in the previous policy and this claim has to be considered under previous policy only and not in the next year policy.  So as per terms and conditions of the policy for the year 2016 to 2017, OP already paid a sum of Rs.3,70,000/- for 4 claims in the previous i.e., 2016-17, the balance amount claimed by the insured/complainant could not be considered favourably and the same was communicated to the insured vide letter dated 13.04.2017.

The OP as per preamble to policy clause for this Group Insurance Policy clearly mentions that in the event of hospitalization “the company will pay to the insured/person’s the amount of such expenses as are reasonably and necessarily incurred up to the limits mentioned in the schedule but not exceeding the sum insured in any one period stated in the schedule hereto”.

The insured/complainant has raised for claims during the policy period P/141123/2016/013744 from 30.01.2016 to 29.01.2017 which are as follows:

i)  CLI/2017/141123/0268008 – The insured/complainant was admitted on 13.10.2016 in Vinay Hospital and Research Centre (A Unit of KIMS), Mangalore for the treatment of PVD/DM/HTN and raised a pre-authorization request to avail cashless facility.  On receipt of the same Rs.89,300/- was settled to the treating hospital vide NEFT transaction No.134667 dated 28.11.2016.

ii) CLI/2017/141123/0358034 – The insured/complainant was admitted on 27.12.2016 in Vinay Hospital and Research Centre (A Unit of KIMS), Mangalore for the treatment of DM, HTN and Diabetic Foot and raised a pre authorization request to avail cashless facility.  On receipt of the same Rs.32,631/- was settled to the treating hospital vide NEFT transaction No.789554 dated 28.02.2017.

iii) CLI/2017/141123/0360287 – The insured/complainant was admitted on 30.12.2016 in KMC, Mangalore for the treatment of CKD/DM/HTN/IHD/Leg Heel gangrene/Foot Ulcer/Sepsis and raised a pre-authorization request to avail cashless facility.  On receipt of the same Rs.1,20,000/- was settled to the treating hospital vide NEFT transaction No.163829 dated 13.01.2017.

iv) CLI/2017/141123/0366120 – The insured/complainant was admitted on 01.02.2017 in Vinay Hospital and Research Centre (A Unit of KIMS), Mangalore for the treatment of DM/HT/CKD/IHD/LT. Heel Ulcer + Gangrene + Sepsis and raised a pre-authorization request to avail cashless facility.  On receipt of the same Rs.1,28,069/- was settled to the treating hospital vide NEFT transaction No.963345 dated 24.04.2017.

From the above, it is observed that, Rs.3,70,000/- (i.e., Rs.89,300 + Rs.32,631 + Rs.1,20,000 + Rs.1,28,069= 3,00,000/-) has been settled to the insured out of the total sum insured of Rs.4,00,000/-.  Since Rs.3,70,000/- has been already settled during the policy period P/141123/01/2016/03744 which is from 30.01.2016 to 29.01.2017, the balance amount of Rs.30,000/- only is payable to the insured.  Further insured/deceased was hospitalized on 02.01.2017 which is during the policy period P/141123/01/2016/03744 which is from 30.01.2016 to 29.01.2017.  Hence, the total sum insured of Rs.4,00,000/- only is payable to the insured.

The group insurance policy is an annual contract and the policy terms and conditions applicable to policy above will be binding on the insurer and insured.  In subject policy there is no clause or condition governing “the claim even falls within two policy period” as alleged by the complainant in the complaint.  Therefore, there is no scope for considering the claim under the next year policy as stated by the insured/complainant.

In rest of the allegations has been specifically denied by OP has made in para.1 to 19 of the complaint to the extent they are contrary to the averments made therein.  Hence on these grounds and other grounds OP pray for dismissal of the complaint.   

4. To substantiate the allegations made in the complaint the complainant submitted his affidavit evidence reiterating the allegations made in the complaint.  One Pushpavathi, Legal Officer of OP submitted evidence by way of affidavit.  Both parties have produced certain documents.  Both parties have submitted their written arguments.  We have also heard oral arguments.

5. The points that arise for our consideration are:

        6. Our answer to the above points are as under:

REASONS

7. Point No.1  We have briefly stated the contents of the complaint as well as the version filed by OP.  The undisputed facts which reveals from the pleadings of the parties goes to show that, the complainant’s father Late A.C Fernandes was insured under the OP ‘Group Mediclaim Tailormade Policy’ (herein after referred as the said policy) obtained by Front Avenue Infosolutions Pvt. Ltd., for the year 2016-17 vide policy bearing No.P/141123/01/2016/013744 for the period 30^th January 2016 to 29^th January 2017 for a sum of Rs.4,00,000/- (Ex-A-1).  It is also not in dispute that the complainant father A.C Fernandes shown as dependant of the complainant.

8. It is also not in dispute that, the said policy was continuously renewed for the year 2017-18 vide policy bearing No.P/141123/01/2017/014007 for a period 30^th January 2017 to 29^th January 2018 for a sum of Rs.8,00,000/- (Ex-A2) and the complainant’s late father A.C Fernandes shown as dependant of the complainant.

9. It is also not in dispute that the complainant’s father late A.C Fernandes was admitted to Vinaya Hospital & Research Center, Mangalore for treatment on 2^nd January 2017 but sadly due to severe multi organs failure could not recover from the illness and expired on 27^th February 2017 in the said hospital.  The death summary is found at Annexure-3.  It is also not in dispute that the complainant’s father late A.C Fernandes was inpatient in the said hospital from 2^nd January 2017 till 27^th February 2017 and the said hospitalization period fell in the above two policy period and was insured under the Policy.  It is also not in dispute that the said hospital raised a total bill of Rs.12,73,530/- for the hospitalization of late A.C Fernandes found at annexure A-4.  Out of the total bill of Rs.12,73,530/- raised by the said hospital for the hospitalization of late A.C Fernandes, even though late A.C Fernandes was fully covered under the said policy, the OP paid only a sum of Rs.1,28,068/- out of the total bill of Rs.12,73,530/- by way of cashless claim settlement.  On enquiry OP informed the complainant that only Rs.1,28,068/- was paid under the policy period of 2016-2017 since the sum insured has exhausted and requested the complainant to seek reimbursement of the remaining amount for the sum insured for the year 2017-2018, since the policy was renewed for the year 2017-18.  This fact has been denied by OP stating that the policy is contractual in nature and the claims arising therein are subject to the terms and conditions forming part of the policy.  Further contended that the terms and conditions of the policy specifically states that the insurance company is not liable to pay in respect of any claim, if there is any misrepresentation and non disclosure of material fact by the insured to the insurer.  The complainant has accepted the policy agreeing and being fully aware of such terms and conditions and executed the proposal form.  That the complainant/insured has reported 5 claims in the 2^nd year of Medical insurance policy from inception.

1. CLI/2017/141123/0268008 – Opposite party settled an amount of Rs.89,300/-.

2.  CLI/2017/141123/0358034 – Opposite party settled an amount of Rs.32,631/-.

3. CLI/2017/141123/0360287 – Opposite party settled an amount of Rs.1,20,000/-.

4. CLI/2017/141123/0366120 – Opposite party settled an amount of Rs.1,28,069/-.

As per the claim form the complainant has claimed an amount of Rs.8,00,000/- (Eight Lakhs) being the reimbursement of medical expenses from the OP for the treatment of his deceased father late A.C Fernandes.

10. According to the case of the complainant though the deceased A.C Fernandes was admitted during first policy period but his treatment was continued during the renewal of the policy and died during the subsistence of the continued policy, hence he is entitled for the assured policy amount of Rs.80,000/-, out of which Rs.30,000/- being received under protest.  For better appreciation of terms and policy conditions we would like to extract the preamble of the said policy reads thus:

“NOW THIS POLICY WITNESSESETH that subject to the terms, conditions, exclusions and definitions contained herein or endorsed or otherwise expressed hereon, the Company undertakes that if during the period stated in the Schedule or during the continuance of this policy by renewal the insured person shall contract any disease or suffer from any illness (hereinafter called DISEASE) or sustain any bodily injury through accident (hereinafter called INJURY) and if such disease or injury shall require the Insured Person, upon the advice of the duly Qualified Physician/Medical Specialist/Medical Practitioner (hereinafter called MEDICAL PRACTITIONER) or of duly Qualified Surgeon (hereinafter called SURGEON) to incur Hospitalization expenses for medical/surgical treatment at any Nursing Home/Hospital in India as herein defined (hereinafter called HOSPITAL) 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 such Insured Person Up-to the limits indicated but not exceeding the sum insured in aggregate in any one period stated in the schedule hereto”.

11. If the above preamble is strictly construed one thing is clear that the company undertakes that if during the period stated in the schedule or during the continuance of the policy by renewal the insured person shall contract any disease or suffer from any illness …… 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 such person.

12. In the light of the above preamble it is needless to discuss in detail though the deceased A.C Fernandes was admitted during the subsistence of the policy period of 30^th January 2016 to 29^th January 2017 which has been renewed during the time of his continuation of treatment to till his death.  Under such circumstances this Forum can only interpret the terms and conditions of the said policy and it cannot deviate and interprets as against the preamble of the policy.  In this context we placed the reliance on the decision reported in;

(2008) 10 SCC 404 in the case of United India Insurance Company V/s. Manubhai Dharmasinhbhai Gajera and others, wherein at para No.J held as under:

J. Constitution of India – Arts. 226 and 32 – Interference in contractual matters – Grant of relief of specific performance or issue of writ of mandamus in case of existence of renewal clause in contract or in case of breach of contract – Permissibility – Held, the same is ordinarily not permissible – Specific Relief Act, 1963, S.10. 

13. The total prayer bill amount of Rs.12,73,530/- is not in dispute but looking to the available materials on record the said bill amount has been settled for an amount of Rs.8,07,562/- (as per Ex.A-5) but any how the claim is restricted to Rs.8,00,000/-.  Out of which Rs.30,000/- has been already paid.  Hence we are of the opinion that the claim repudiated by the OP is against the settled principles of law by mis-interpreting its terms and policy conditions.

14. In view of our discussions made above we are of the firm opinion that the very act of the OP is nothing but deficiency of service.  Accordingly complainant is entitled for an amount of Rs.7,70,000/-.  The complainant has sought for an amount of Rs.5,00,000/- for the mental agony, hardship due to non payment of Rs.7,70,000/-.  No doubt the OP by mis interpreting the terms and conditions negated the legitimate claim of the complainant.  Hence complainant has put into mental agony and hardship which is to be compensation by imposing an amount of Rs.5,000/- in addition to the litigation cost of Rs.5,000/-.  Accordingly we answered point No.1.       

          15. Point No.2: In the result, we passed the following:         

  O R D E R

The complaint filed by the complainant is allowed in part.  OP is directed to process the legitimate claim of the complainant for an amount of Rs.7,70,000/- (Rupees Seven Lakhs Seventy Thousand Only) to be payable by OP to the complainant.  Further OP is directed to pay compensation of Rs.5,000/- together with litigation cost of Rs.5,000/- to the complainant.

 OP is directed to comply this order within four weeks from the date of receipt of the order. 

Supply free copy of this order to both the parties.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Forum on this 22^nd day of May 2019)

MEMBER                                                              PRESIDENT

Vln*

Witnesses examined on behalf of the complainant dated 05.01.2019.

Mr.Anand Fernandes

Documents produced by the complainant:

  Witnesses examined on behalf of the Opposite party dated
  18.01.2019.

                Pushpavathi.

Documents produced by the Opposite party:

MEMBER                                                               PRESIDENT

Vln*