BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 22^nd DAY OF MARCH 2022

ORDER

SRI.K.S.BILAGI, PRESIDENT

1. This complaint has been filed under Section 12 of C.P.Act, 1986 (herein under referred as an Act) has filed the complaint for the following reliefs against the OP:-

(a) Pay a sum of Rs.5,12,447/- with interest at 18% p.a. from 22.08.2019 till the actual date of payment.

(b) Pay a sum of Rs.3,00,000/- along with interest at 18% p.a. towards compensatory damages.

(c) Pay the cost of proceedings.

(d) Grant any other reliefs.

2. The case set up by the complainant in brief is as under:-

The complainant having taken policy for the period from 26.08.2018 to 25.08.2019 for self and his family members i.e. his wife and children Akashay Sagar.R. and Anushka.R by paying premium of Rs.16,886/-.  The complainant got renewed this policy on 27.09.2019 for the period from 27.09.2019 to 26.09.2020 by paying same premium.

3. Smt.Rajeshwari wife of the complainant was diagnosed severe mitral regurgitation, severe mitral stenosis with severe PAH and underwent surgery on 31.07.2019 with St.Judge Mitral Value Prosthesis rotables + LA appendage ligation in Ramaiah Memorial Hospital and incurred Rs.5,12,447/- towards medical expenses.

4. The OP turned down the request of the complainant for cashless medical facility.  Later, Ramaiah Memorial Hospital send E-mail to the OP. But, OP repudiated the contract by quoting untenable reasons.  The repudiation of the claim of the complainant amounts to deficiency of service and illegal.  Hence, this complaint.

5. After receipt of notice, the OP appears and files version. OP contends that the complainant is not a consumer and complaint is not maintainable.  There is no deficiency of service and negligence on its part.  There are no grounds to grant any reliefs as this Commission has no jurisdiction to decide the complicated questions.

6. The OP admits issuance of police and renewal of the policy.  But, the insured has not disclosed the existing health problem of bronchial asthama while submitting proposal form.  The complainant has suppressed the material facts i.e. pre-existing ailment.  Therefore, the repudiation of the claim is legally correct.  The OP requests to dismiss the complaint.

7. The complainant has filed his affidavit evidence and relies on 11 documents.  The OP has filed affidavit evidence of its official and relies on two documents.  Heard the arguments of both the side. We perused the records.  

8. The following points arise for our consideration:-

1. Whether the complainant proves deficiency of service on the part of OP?
2. Whether the complainant is entitled to relief mentioned in the complaint?
3. What order?

9. Our answers to the above points are as under:

       Point No.1:  In the affirmative.

Point No.2:- Partly in the affirmative.

      Point No.3: As per final orders

REASONS

10. Point Nos.1 and 2:  These two points have been taken for common consideration to avoid repetition of discussion and avoid over lapping of the reasons.
11. The first contention of the OP is that the complainant is not a consumer and complaint is not maintainable.  But, it is proved from the allegations made in the complaint, admitted by the OP, evidence of complainant and documentary evidence.  Ex.P.2 and Ex.P.3 indicate that the complainant took the policy by paying necessary premium of Rs.16,886/- for the period from 2018 to 2019 and later on, the complainant got renewed the policy for himself and his family members including his wife and two children for the period from 2019 to 2020 by paying same premium.  The terms and conditions of the policy are binding on both the parties.  The complainant being the policy holder is entitled to file this complaint. In other words, the complainant is the beneficiary and he has paid the premium amount.  Therefore, there is no substance in the contention of the OP that the complainant is not a consumer and complaint is not maintainable.
12. The complainant has availed the service of insurance policy by paying necessary premium amount to the OP.  The complainant alleges that repudiation of his claim is illegal and amounts to deficiency of service.  When there is an allegation of deficiency of service, the complaint before this Commission is maintainable.  There are no complicated questions as stated by the OP to refer the parties to the Civil court.
13. The documents produced by both the parties are not in dispute.  Ex.P.1 is the certificate under Section 65(B) of Evidence Act.  The OP admits issuance of policy and renewal of policy during the relevant time.  The condition No.49(c)(2) speaks that “claim arising out of or howsoever connected to the following for the first 24 ours of mediclaim insurance policy” is not applicable.  The condition No.49 C (2) which read thus:-

49 – We, our, ours means the Bajaj Allianz Insurance Company Limited.

C) what we will not pay (Exclusion) under this policy?

We shall not be liable to make any payment for any claim directly or indirectly caused by, based on, arising out of or attributable to any of the following:

2. We will not pay for claims arising out or howsoever connected to the following for the first 24 months of mediclaim insurance policy.

This exclusion shall apply for a continuous period of 36 months from the date of your first mediclaim insurance policy, if the above referred illness were present at the time of commencement of the policy and if you had declared such illness at the time of enhancement of sum insured, the waiting periods shall apply afresh only to the extent of the amount by which the limit of indemnity has been increased (i.e. enhanced sum insured) and if the policy is a renewal of mediclaim insurance policy with us without break in cover.

14. It is proved from Ex.P.5 and supported by the evidence of complainant that he got admitted his wife in Ramaiah Memorial Hospital for treatment and paid Rs.5,12,446.64.  This payment is not denied by the OP.
15. The OP denies claim of the complainant stating that the complainant not disclosed pre-existing illness of his wife while submitting proposal form and complainant is not entitled to any reliefs for having suppressed material fact with regard to the illness of his wife.  We would like to consider this aspect at the later stage after considering the other documentary evidence.  Ex.P.5 indicates that Rajeshwari.V. wife of the complainant was admitted in Ramaiah Memorial Hospital on 31.07.2019 and discharged on 22.08.2019 with history of present illness i.e. “Patient presented with complaints of exertional breathlessness, since 5-6yrs, NYHA grade 1, insidiouos in onset, gradually progressive to NYHA grade II since 6 months.  History of intermittent episodes of orthopnea, PND.  No history of chest pain, palpitations, syncope, presyncope, swelling of lower limbs.  History of pain abdomen in the epigastric region since 3 days.  History of 3 episodes of vomiting+, non blood stained, non foul smelling.  History of one episode of fever+ 3 days back.” Discharge summary further indicates that Rajeshwari.V. was suffering from bronchial asthma on SOS medications.  S/P Tubectomy.  The treatment / surgery was provided to the wife of the complainant for severe MR with severe MS with PAH.  Ex.P.5 clearly indicates that the nature of treatment provided to the wife of the complainant.  M.S.Ramaiah Memorial Hospital insurance help desk issued Ex.P.6 E-mail with enclosures.  However, OP issued Ex.P.7 letter dated 17.08.2019 denying the cashless facility. The proposal of cashless facility sought by the complainant to be repudiated by the OP.
16. Later on, complainant had submitted claim petition and by issuing Ex.P.8 letter dated 11.09.2019, the OP repudiated the claim stating that the pre-existing illness since 6 years was suppressed while submitting proposal form and thereby, express his intention to cancel the policy.
17. However, the complainant got sent a letter dated 22.08.2019 that the patient Rajeshwari.V. diagnosed with severe MR, severe MS with PAH for the first time on the date of admission.  Admittedly, the insurance coverage for Rs.10,00,000/-.  Ex.P.10 is the claim form submitted by the complainant.  Ex.P.11 is the policy with terms and conditions.  It is not in dispute.  The policy terms and conditions are binding on both the parties.
18. The OP has filed affidavit evidence of its official with 2 documents. The official of OP categorically states that the complainant suppressed the illness of his wife while submitting proposal form and wife of the complainant was suffering from illness since 6 years before admitting her in M.S.Ramaiah Memorial Hospital.  Thereby, the OP requests to dismiss the complaint. The OP relies on the policy terms and conditions which are not in dispute.
19. The condition No.49(C) (2) referred above clearly indicates that certain mediclaims are not permissible. The main trump-card of the OP in repudiation of the claim of the complainant that the complainant suppressed the fact of illness of his wife while submitting the proposal form.  It is pertinent to note that the proposal form containing all the particulars with signature of the complainant is not placed before us to ascertain, whether complainant has suppressed the material fact of illness of his wife.  The burden lies on the OP to prove the contents of proposal form and establish that the complainant suppressed material facts of illness of his wife.  When the OP is in possession of proposal form and when the burden lies on the OP to prove suppressing of material fact, it is the duty of the OP to prove this fact.  OP has retained this material fact and expect this Commission to believe its version and adverse inference requires to be drawn against the OP, for non-production of declaration form.
20. The advocate for the complainant in support of his arguments, places reliance on the following three decisions:-

1. 2007 (98) DRJ 246 – High Court of Delhi in the matter between Hari Om Agarwal Vs. Oriental Insurance Co.Ltd.,
2. (2020) 3 Supreme Court cases 455 in the matter between Canara Bank Vs. United India Insurance Co.Ltd.,
3. Civil Appeal No.8386/2015 in the matter between Manmohan Nanda Vs. United India Assurance Co.Ltd., and another of Supreme Court of India.

21. We carefully perused all these citations.  In the first decision, the claim of the petitioner came to be repudiated on the ground of pre-existing disease.  The Hon’ble High Court of Delhi was please to allow the petition stating that the object of the insurance policy is cater to the medical expenditure incurred by the insured.  In the 2^nd decision, the repudiation of claim in respect of loss of stored agricultural produce – claim if a fraudulent one, on ground of period of storage of the produce concerned – held, would depend on the nature of the produce.  In the last decision, the Hon’ble Supreme Court of India while set aside order of the National Consumer Disputes Redressal Commission dismissing the complaint of the applicant held that the claim would be in terms of Indian Rupee.
22. In view of above settled preposition of law, once again we carefully perused Ex.P.2 and Ex.P.3, two policies.  It is specifically mentioned in the policy with regard to the question and answer furnished by the complainant and his family members. The Question 1 which read thus:-

Q1. Do you or any of the family members to be covered have/had any health complaints/disability/met with any accident in the past and/or have been taking treatment/ hospitalization? Refer below table for details of illness (if any)_ mentioned in pre-existing diseases column.

Kindly note that as the information/contents and declaration/ confirmation provided by you as contained in this transcript is the basis on which we have issued the policy to you, we advise you to please enquire that you have provided/disclosed and or not withheld any material facts / information and declaration, as policy becomes void ab-intia if material facts.

23. The above recital in the policy clearly indicates that in case of non-disclosure of existing disease while taking policy, insurer is right in repudiating the claim.
24. It is true that the pre-existing disease, the column meant that pre-existing disease is shown as not applicable.  This recital must be based on the declaration submitted by the insured-complainant.  Under such circumstances, the proposal form submitted by the complainant while taking policy is material document to show that the complainant submitted false declaration by suppressing existing disease/illness of his wife Rajeshwari.V. In the absence of production of such declaration, it is very difficult to accept the contention of the OP that the complainant suppressed the pre-existing disease of his wife Rajeshwari.V.  We failed to understand why the OP has not furnished signed declaration submitted by the complainant while taking policy and complainant intentionally suppressed the pre-existing disease of his wife and adverse inference can be drawn against the OP for non-production of this material document.
25. It is true that Ex.P.5 discharge summary dated 31.07.2019 to 22.08.2019 indicates that Rajeshwari.V was suffering from exertional breathlessness, since 5-6 years, NYHA grade-I, insidious in onset, gradually progressive to NYHA grade II since 6 months.  History of intermittent episodes of orthopnea, PND.  No history of chest pain, palpitations, syncope, prestyncope, swelling of lower limbs.  History of pain abdomen in the epigastric region since 3 days.  History of 3 episodes of vomiting+, non blood stained, non foul smelling.  History of one episode of fever+ 3 days back.  Even this recital is taken into consideration, Rajeshwavi.V. had developed NYHA grade-II in January/February 2019.  The policy in this case is for the period from 27.09.2019 to 26.09.2020.  The treating doctor issued a Ex.P.8 stating that even though Rajeshwari.V. had breathlessness on and off.  But, she was not aware of her heart condition prior to her admission to M.S.Ramaiah Memorial Hospital.  Under such circumstances, the heavy burden lies on the OP to prove that the suppression of illness of wife of the complainant either due to NYHA grade I and NYHA grade II is the cause for health issue.  The OP failed to examine the documents produced by the complainant along with claim petition and has not obtained expert opinion.  Under such circumstances, the rejection of claim by the OP is illegal and amounts to deficiency of service.
26. When there is a deficiency of service in rejection of claim petition, the complainant is entitled to reimbursement of Rs.5,12,447/-.  The complainant claims interest at 18% p.a. on this amount from 22.08.2019 till realization and compensation of Rs.3,00,000/-.  If the compensation is awarded to the complainant for deficiency of service, the complainant is not entitled to interest at any rate.  This complaint is filed within four months from the date of repudiation.  Under such circumstances, the claim of compensation of Rs.3,00,000/- is not only exorbitant and suffers from the no foundation.  Under such circumstances, it is proper to award Rs.30,000/- as a compensation.
27. Point No.3:- In view of the discussion referred above, the complaint requires to be allowed in part.  The OP shall liable to refund Rs.5,12,447/- with compensation of Rs.30,000/- and cost of litigation Rs.10,000/- as complainant has availed service of an advocate. We proceed to pass the following 

  O R D E R

1. The complaint is allowed in part.
2. The OP shall pay Rs.5,12,447/- with compensation of Rs.30,000/- and cost of litigation Rs.10,000/- to the complainant. 
3. The OP shall comply this direction within 60 days from this date, failing which the OP shall pay interest at 8% p.a. on Rs.5,12,447/- after expiry of the 60 days till realization.   
4. Furnish the copy of this order to both the parties.

 (Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 22^nd March, 2022)

Documents produced by the Complainant which are as follows:-

Documents produced by the OP which are as follows:-