Complaint filed on: 06-01-2017 Disposed on: 27-10-2017
BEFORE THE DISTRICT CONSUMER DISPUTES
REDRESSAL FORUM
OLD DC OFFICE COMPOUND, TUMAKURU-572 101
CC.No.03/2017
DATED THIS THE 27th DAY OF OCTOBER 2017
PRESENT
SMT.PRATHIBHA. R.K. BAL, LLM, PRESIDENT
SMT.GIRIJA, B.A., LADY MEMBER
Complainant: -
Sri.T.G.Ramachandra Rao,
S/o. Gangoji Rao,
Aged about 72 years,
Residing at 1st Cross, Shivanagara,
Channappanapalya,
Upparahalli, Tumakuru city
(By Advocate Sri.Umesh)
V/s
Opposite parties:-
1.The Branch Manager,
Star Health Allied Insurance Co. Ltd, 24th Cross, SIT Main Road,
Tumakuru city
2.The Manager,
Star Health Allied Insurance Co. Ltd, No.48/2, 1st Floor, 8th Main, 13th Cross, Diagonal Opp. Canara Union, Malleshwaram, Bengaluru city-560 003
3.The Manager,
Star Health Allied Insurance Co. Ltd, No.1, New Tank Street, Valluvar Kottam high Road,
Numgambakkam,
Chennai-34
(OP No.1 to 3 by Advocate Sri.H.M.Nagabhushan)
ORDER
SMT.PRATHIBHA. R.K. PRESIDENT
This complaint is filed by the complainant against the OP No.1 and 2, under Section 12 of the Consumer Protection Act. The complainant prays to direct the OPs to pay the entire amount covered under policy issued by them along with bill amount of Rs.75,555=00 with interest @ 18% p.a. from Sept. 2016 to till its realization and to pay a sum of Rs.4,00,000=00 towards mental harassment, deficiency in service, loss of money and breach of terms of the policy with interest @ 12% p.a. from the date of petition till its realization, in the interest of justice and equity.
2. The brief facts of the complaint is as under.
The complainant had obtained a health insurance policy from the OPs vide policy No.P/1411150/01/2017/000408 which was valid from 14-4-2015 to 13-4-2016. The complainant submitted that, the complainant had been admitted to Vinayaka Hospital, Tumakuru for his ill health and diagnosed that, the complainant is suffering from an acute ON CKD disease and after initial treatment, the complainant was referred to Manipal Hospital, Bengaluru for higher treatment and admitted as inpatient and took treatment in the said hospital and the same was informed to the OPs Company. After discharge from the hospital, the complainant had submitted both the hospital bills for a sum of Rs.75,555=00 and sought for reimbursement of the said hospitals expenses as per the term of the insurance policy. But the OPs Insurance Company instead of paying the amount, they have issued a letter dated 4-10-2016 stating that, the policy is cancelled with effect from 13-11-2016 and repudiated to pay the policy amount and issued a cheque for a sum of Rs.5,096=00 by refunding the half of the premium amount and repudiated the claim of the policy amount. Hence, the complainant had issued a legal notice to OPs on 30-11-2016 by RPAD calling upon them to pay the amount covered under the policy as per the terms and conditions of the policy. The said notice was duly served on the OPs. Even inspite of service of the notice, the OPs did not choose to comply the same. Hence, the complainant has come up with the present complaint.
3. In response to the Forum Notice, the OP No.1 to 3 have appeared through their counsel and filed common objection, contending interalia as under:
The complaint is not maintainable either in law or on facts and it is liable to be dismissed in limine. The OPs submitted that, the complainant had availed Senior Citizens Red Carpet Insurance policy for a sum of Rs.1,00,000=00 under policy No.P/141115/01/2016/000364 for the period from 14-4-2015 to 13-4-2016. Subsequently the policy was renewed for period from 14-4-2016 to 13-4-2016 vide policy No.P/141115/01/ 2017/000408.
The OPs further submitted that, the policy is contractual in nature and the claims arising therein are subject to 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 no disclosure of material fact by the insured to the insurer. As the complainant being fully aware of such terms and conditions and executed the proposal form and accepted the policy.
The OPs further submitted that, the complainant made a pre-authorization request to avail cashless facility towards his medical treatment and hospitalization for acute febril illness at Vinayaka Hospital, Tumakuru on 22-9-2016. The OPs on receipt of claim papers submitted by the treating hospital and the insured scrutinized the same and observed the following:
a)The admission record shows the patient is a known case of old CVA and had a history of Pyelonephritis 7-8 years ago.
b)The progress sheet states that, the insured patient is a known case of hypertension since 20 years, CKD (Chronic Kidney disease).
The insured prior to the policy and has not disclosed in the proposal form.
The OPs further submitted that, the complainant had subsequently made a pre-authorization request to avail cashless facility towards his medical treatment and hospitalization for viral haemorrhagic fever at Manipal Hospital, Bengaluru on 25-9-2016. The OPs on receipt of claim papers submitted by the treating hospital and the insured, scrutinized the same and observed the following:
1)The discharge summary of admission dated 25-9-2016 shows the patient had a post history of HTN since 10 years and elevated Sr.Creatinine 8 years back.
The aforesaid medical records of the complainant were present even prior to the inception of medical insurance policy, where were not disclosed by the complainant to the insurer whiling the policy.
The OPs further submitted that, the policy condition no.9 clearly stipulates as follows:
“The company shall not be liable to make any payment under the policy in respect of any claim if information furnished at the time of proposal is found to be incorrect or false or such claim is in any manner fraudulent or supported by any fraudulent means or device, misrepresentation whether by the insured person or by any other person acting on his behalf”
The OPs further submitted that, medical records of the complainant narrated above relating to his pre-existing health condition are material facts which the complainant has knowledge and is bound to disclose in his proposal form, while availing the policy with the insurer. But the complainant has wantonly misrepresented and non-disclosed the vital material facts from the insurer which amounts to violation of policy terms. The OPs were therefore constrained to repudiate the claim of the complainant by letter dated 24-9-2016 and 28-9-2016 respectively. The repudiation of claim is proper and based on policy terms and the OPs has not committed any deficiency in service as alleged by the complainant.
The OPs further submitted that, the insurance is based on utmost good faith. Both parties are bound by the terms and conditions of contract of insurance. Viewed thus, both factually and legally the claim has been settled in accordance with policy terms and the insurer cannot be held liable and compelled to pay the sum which is not payable under the contract of insurance therefore deemed fit to be repudiated by the insurer. The complainant is obliged to make a complete disclosure of all material facts, particularly past medical history which plays a major factor for the insurer in deciding the premium and issuance of mediclaim policy.
The OPs further submitted that, the complainant has filed this complaint vexatiously and frivolously for the sole purpose of harassing the OPs with the intention for getting unlawful enrichment from the OPs, 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 in dealing with the claims by applying all conditions correctly. Hence, the complaint is liable to be dismissed with exemplary costs, in the interest of justice and equity.
4. In the course of enquiry in to the complaint, the complainant and OPs have filed their affidavit evidence reproducing what they have stated in their respective complaints and version. Both parties have produced documents which were marked as Ex-C1 to C40 and Ex-R1 R4. We have heard the arguments of both parties and perused the documents and then posted the cases for orders.
5. Based on the above materials, the following points will arise for our consideration.
1. Whether there is deficiency in service on the part of the OPs as alleged by the complainant?
2. What Order?
6. Our findings on the above points are;
Point no.1: In the affirmative
Point no.2: As per the final order below.
REASONS
7. Looking into the allegations made in the complaint and also version filed by the OPs, it is not in disputed that, the complainant had obtained Senior Citizens Red Carpet Insurance policy for a sum of Rs.1,00,000=00 vide policy bearing No.P/141115/01/2016/000364 for the period from 14-4-2015 to 13-4-2016 and again the said policy was renewed from 14-4-2016 to 13-4-2017 vide policy bearing No.P/141115/01/ 2017/000408. It is also an admitted fact, on 22-9-2016 the complainant was admitted to Vinayaka Hospital, Tumakuru for his ill health and he was referred to Manipal Hospital, Bengaluru for higher treatment and admitted as an inpatient and took treatment in the said hospital.
8. The main contention of the complainant is that, after submitting the hospital bills expenses of Rs.75,555=00 for reimbursement. The OPs has not settled the medical expenses and cancelled the policy with effect from 13-11-2016 and repudiated the claim amount.
9. Per-contra, the OPs have strongly contended that, medical records of the complainant narrated his pre-existing health condition are material facts which the complainant has knowledge and is bound to disclose in his proposal form, while availing the policy with the insurer. But the complainant has wantonly misrepresented and non-disclosed the vital material facts from the insurer which amounts to violation of policy terms. The OPs were therefore constrained to repudiate the claim of the complainant. The repudiation of claim is proper and based on policy terms and the OPs has not committed any deficiency in service as alleged by the complainant.
10. On perusal of the repudiation letter of OP dated 4-10-2016/Ex-C3, it reads as under:
“We refer the letter dated 29-SEP-16 from our claims department. We wish to bring to your kind attention that during the scrutiny of the above claim papers, we observe that you have NOT declared the details: OLD CVA….ACUTE ON CKD (relating to Mr.T.G.Ramachnadra Rao) which were found to be existing at the time of taking the policy for the first time during 14-APR-15 to 13-APR-16. This amounts to non disclosure of material facts.
We draw your attention to condition no.11 in the policy clause which reads as follows:
The Company may cancel this policy on grounds of non disclosure of material fact or non-co-operation by the insured person-by sending the insured 30 days notice by registered letter at the insured person’s last known address.
Therefore, you are hereby informed that as per the above clause, we intend to cancel the policy in respect of the above person w.e.f. 13-NOV-16. .This letter shall be taken as the notice of cancellation as per the above mentioned condition no.11 of the policy clause”.
However, a cheque for refund of premium calculated on prorate basis will be sent short.
Besides a new policy for other persons already covered will be sent shortly”.
The crux of the matter is that, whether the OPs are right in repudiation of the claim of complainant.
11. On perusal of the Ex-R1/Senior Citizens’ Red Carpet Insurance-Proposal Form, wherein it is seen that, at the time of inception of the policy dated 14-4-2015, the complainant discloses that, he is suffering from “due to diabetic problem getting tablets regularly”. The additional questions to be attached to Senior citizen’s proposal form in that the complainant had answered the following:
Have you ever suffered from/Are you suffering from any of the following diseases?
Cancer | No |
Chronic Kidney Disease | No |
CVA/Brain Stroke | No |
Alzheimer Disease | No |
Parkinson’s Disease | No |
12. On perusal of the Discharge summary of complainant issued by the Manipal hospital, Bengaluru/Ex-R3 and Ex-C26, wherein it is seen that, the complainant had admitted to hospital for fever and diagnosed as “Viral haemorrhagic fever, UTI, Type 2 DM, HTN and Acute on CKI” and in the past history column, it is mentioned as “DM 11 since 20 years, HTN since 10 years and 8 years back elevated Sr.creatinine”.
13. Admittedly, the complainant was admitted to the hospital because of fever and the doctors had diagnosed the viral fever and he took the treatment for said viral fever. Now, the OPs cannot escape from their liability by paying medical expenses and repudiated the claim of the complainant by stating that, the complainant was suffering from CVA (Brain Stroke) and CKD (Chronic Kidney Disease) and history of the HTN since 10 years and 8 years back early Sr.Creatinine is unjustified. No piece of medical evidence or proved to show that, the complainant had undergone medical treatment for the said disease prior to the date of inception of the policy. Therefore, when there is no reliable piece of evidence or proof to show that, the complainant has pre-existing disease much prior to the obligation of his first policy marked as Ex-R1. The repudiation of the claim by the OP amounts to deficiency in service. The complainant is being a Senior Citizen and he had obtained a Senior Citizens’ Red Carpet Insurance policy from the OPs. Moreover the complainant disclosed that, he is suffering from diabetes and taking treatment. It is the duty of the OPs to take medical examination report at the time of issuing the policy. Further the OPs are also not produced any documentary evidence to shows that, the complainant had taken treatment for CVA (Brain Stroke) and CKD (Chronic Kidney Disease) before obtaining the policy. Without producing any documentary evidence, the OPs had repudiated the claim of the complainant is unjustified. As such, we are of the view that, the OPs were not justified in making repudiation of claim. Be that as it may, the complainant had taken treatment for viral fever only. Admittedly, he has not taken treatment for stroke of the brain or for kidney disease. In the guise that, the complainant had a pre-existing disease, the Ops cannot repudiate the claim of the complainant and to compensate him for viral fever. Further the bills submitted by the complainant are for viral fever only. On the other hand the complainant has proved with convincing material evidence that, the OPs are negligent and there is deficiency in service on the part of the OPs in making rejection of his claim without any proper material evidence and accordingly we answer this point in the affirmative. In the result, for the foregoing reasons, we proceed to pass the following order.
ORDER
The complaint filed by the complainant is allowed in part.
The OP No.1 to 3 are directed to pay medical expenses of Rs.75,555=00 to the complainant along with 9% interest per annum from the date of complaint to till the date of realization.
The OP No.1 to 3 are further directed to pay compensation of Rs.10,000=00 toward deficiency in service and Rs.5,000=00 towards litigation cost to the complainant respectively.
This order is to be complied by the OP No.1 to 3 within 30 days from the date of this order.
Supply free copy of this order to both parties.
(Dictated to the Stenographer, transcribed and typed by him, corrected and then pronounced by us in the Open Forum on this, the 27th day of October 2017)
LADY MEMBER PRESIDENT
