SMT. RAVI SUSHA: PRESIDENT

Complainant has filed this complaint U/s 12 of Consumer Protection Act 2019, for getting a direction to opposite parties to pay an amount of Rs.5,00,000/- for the medical expenses incurred to the insured for medical treatment together with Rs.3,00,000/- towards compensation for the mental agony caused to the complainants, alleging deficiency in service and unfair trade practice of opposite parties.

Briefly stated the facts of the case are :  As per the request of the respondents, husband of No.1 of the complainant and the father of the other complainants named Rathnakaran  NC was taken out a health Insurance policy.  He insured the Health Insurance policy of the respondents from 2015 on words with the policy No.120100/ 12001/ 2016/ A004588/ PE00129319 from 02/02/2016 to 01/02/2017 and renewed up to 01/02/2018.  Before the expiry of the insurance coverage period said Rathnakaran NC was hospitalized KMC Hospital, Mangalore listed hospital under the respondents.  He was hospitalized from 10/03/2017 to 28/03/2017, 13/04/2017 to 15/04/2017, 22/04/2017 to 01/05/2017 and spent an amount of Rs.5,00,000/-.  It is submitted that the policy holder applied for the cashless benefit through the hospital authority for the above said period.  But the same was willfully rejected by the OPs.  After discharge from the hospital he was expired on 07/05/2017 at the local hospital while continuing the medical treatment.  His death was premature due to the mental agony he suffered because of the out-right rejection of his claim for cashless medical services that felt him cheated.  There after the complainants approached the respondent No.1 and 3 but they are not taken any action to get the insurance benefit to the petitioners.  Due to the adamant attitude of the opposite parties the complainants are caused to send lawyer notice dated 24/10/2017 to the opposite parties.  The opposite parties are acknowledging the notice but not send any reply or paid the policy benefit to the complainants.  Hence this complaint.

            OPs, after being served, entered appearance and filed written version jointly.  1 and 2 rebutting the allegations made in the complaint.  OP submitted that the deceased insured had obtained the insurance policy at the request of the 1^st and 2^nd OPs is false.  The policy was issued to the policyholder on the basis of a proposal form submitted by him to the 1^st and 2^nd OPs.  The insured had availed the Apollo Munich Easy Health Group Insurance –Individual Plan Policy from the 1^st and 2^nd Op and had willfully withheld material information at the time of taking the policy.  The policy had commenced on 02/02/2016 and had been renewed to extend coverage up to 01/02/2019.  The deceased insured was a known case of type II diabetes mellitus and hypertension since the last 20 years and was also diagnosed to have atrial fibrillation 9 years ago.  While submitting the proposal from, the insured had willfully suppressed the above mentioned material information in order to obtain the policy.  The pre-authorization form of the insured also states the fact that the insure had pre-existing ailments of diabetes, heart disease (Atrial Fibrillation) and hypertension.       The policy was issued to the complainant based on the proposal form                                submitted by the deceased insured.  He had declared and warranted that he did not have any complication related to diabetes and hypertension.  He had further declared that he was not having any disease of the major organs including but not limiting to the brain, heart, kidney, lungs liver or mental disorder. The insured had also stated in the proposal form that he had not taken any medicine for more than 21 days consistently in the last 5 years. He had also declared that he was neither awaiting treatment medical or surgical nor attending any follow up for any disease/condition/ailment /injury/addiction.  The insured had also declared in the proposal form that he was also aware that the information provided by him was the basis for the insurance policy and that the information provided are true and complete in all respects and that there is no other information which is relevant for insurance that has not been disclosed to the 1and 2^nd OPs.  The insured had suppressed materiel facts and had also made false declarations and hence the policy had become void ab initio.  The insured had suppressed material information which was vital in assessing the undertaking of risk by the 1^st and 2^nd OPs. The non-disclosure of facts relating to             pre-existing medical condition of the insured pertaining to type II diabetes mellitus and hypertension since the last 20 years  and atrial fibrillation 9 years ago are material facts that have direct bearing on the underwriting of risk by the1st and 2^nd OPs.  The insured was treated for pyrexia of unknown origin with diabetes mellitus, hypertension and arterial fibrillation.  The pre-existing diseases of the insured were contributory factors that led to his later medical condition.  According to the conditions of the policy, if at the time of issuance of the policy or during the continuation of the policy, the information provided to 1^st and 2^nd OPs in the proposal form or otherwise by the insured is found to be incorrect, incomplete or not disclosed, willfully or otherwise, the policy shall be cancelled ab initio from the inception date or the renewal date and the claim under such policy shall be rejected/repudiated.  The allegation of the complainant that the death of insured was due to the rejection of his cashless clam is false and hence denied.  The 1^st and 2^nd OPs are not liable to pay an amount of Rs.5,00,000/- as compensation. There has been no violation of the terms and conditions of the policy by the 1^st and 2^nd OPs.  Hence prayed for the dismissal of complaint.

            3^rd OP, Canara Bank, main branch, Kannur has filed separate version stating that Canara bank is only an agent of OP No.1 and 2. N C Rathnakaran was a customer of this OP and he has taken health insurance policy of OPs No.1 through this OP.   The OP did not receive any notice from the complainants and they did not approach this OP No.3.  More over the denial of benefit under the policy is on the part of OP No.1 and 2.  This OP submits that the complainant is not entitled to get any relief from this OP as prayed for.

1^st complainant has filed her chief affidavit and documents Ext.A1 to A11 has been marked.  She was subjected to cross-examination for OPs 1 and 2.  OPs 1 and 2 has produced documents Ext.B1 and B2.  The case records from KMC Hospital, Mangaluru, from where the insured had availed treatment is produced as per the direction of this commission, which was marked as Ext.X1.  After the evidence the learned counsel for the complainant and the learned counsel for the OPs 1 and 2 have filed their written argument notes.

            The learned counsel of complainant submitted that while the policy was in force, the insured was hospitalized at KMC Hospital Mangalore and spent Rs.5,00,000/- treatment.  Further the policy holder applied for the cashless benefit through hospital authorities for the treatment, but the same was willfully rejected by the OPs and after discharge from the hospital, the insured was expired while continuing the medical treatment at the local hospital.  Complainants alleged that the death was premature due to the mental agony he suffered because of the rejection of his claim for cashless medical services. Here it is revealed that during cross-examination of 1^st complainant, she admitted the statement in Ext.X1 case records of KMC hospital that the insured had been suffering from diabetic and blood pressure since last 15 years and also had heart disease.  She also deposed that during 2014-15 period the deceased insured was consulted Dr.Vijayakumar. She has also categorically admitted that in the proposal form given by her husband (insured) had declared that he did not have any complication related to any disease.

          Here OPs 1 and 2 contended that the deceased insured was a known case of Type II diabetes mellitus and hypertension since the last 20 years and was also diagnosed            to   have astrial fibrillation 9 years ago. Further submitted that, while submitting the proposal

form, the insured had willfully suppressed the above mentioned material information in order to obtain the policy.  The policy was issued to the complainant based on the proposal form submitted by the deceased insured.  OPs1 and 2 further stated that according to the conditions of the policy, if at the time of issuance of the policy or during the continuation of the policy, the information provided to the Insurance company in the proposal form by the insured is found to be incorrect, or not disclosed willfully, the policy shall be cancelled ab initio from the inception date or the renewal date and the claim under such policy shall be repudiated.

            We are of the view that on consideration of both submissions of parties it is a well settled proposition of law that a contract of insurance is based on the principle of utmost good faith.  The insured knows all the facts, the insurer is unaware of anything which may be material to the risk.  The law, therefore enjoys on the insured an absolute duty to disclose correctly all material facts which are within his personal knowledge.  It is a settled position that a contract of insurance, therefore, can be repudiated for non-disclosure of “material facts.”.

            In the present case the question to decided is whether the insured had suppressed any ‘material facts’, which would have been relevant for the insurance company in order to decide whether to issue an insurance policy to the deceased?

            For which the point to be decided is whether the insured was treated or he was known patient of diabetic, hypertension and heart disease prior to the inception of the policy.  It is seen that all the questions were answered in the proposal form in the negative.  Additionally the insured had given a good health declaration and had also declared that he was neither awaiting medical treatment or surgical, not attending any follow up for any disease/ailment.  But from Ext.X1 case record, more over Pw1 categorically admitted that the deceased insured was suffering from diabetes, hypertension and heart disease and was under treatment and was on regular medication for over 15 years.  Of course, these were “material facts” and being within the knowledge of the insured only, he was obliged to disclose the same correctly in the proposal form.  Having suppressed the said facts while filling the proposal form, we are of the opinion that the Insurance company was within its rights to repudiate the claim of the complainants.  In that view, there was no question of any deficiency of service on the part of opposite parties 1 and 2 the Insurance Company.  Since opposite party No.3 is only an agent of opposite parties 1 and 2 and the denial of policy benefit was under the decision of opposite parties 1 and 2, opposite party No.3  is not responsible for it.  Moreover, there is no deficiency in service on the part to opposite parties 1 and 2 also.

            In the result, complaint is dismissed.  No order as to cost.

Exts.

A1- Insurance policy kit No.1

A2- Insurance policy kit No.2

A3- Copy of lawyer notice

A4(series)- 3 postal  receipt

A5- Postal acknowledgement card

A6- Hospital payment receipt and bill (Subject proof)

A7- Hospital payment receipt and bill including discharge summary

A8-Payment receipt and bill

A9-Payment receipt and bill

A10- Payment receipt and bill including discharge summary

A11-Payment receipt and bill

Pw1-Complainant

B1-Proposal form submitted by deceased insured

B2-Certificate of insurance –health

X1- The case records from KMC Hospital, Mangaluru

      Sd/                                                                          Sd/                                                     Sd/

PRESIDENT                                                                   MEMBER                                                   MEMBER

Ravi Susha                                                               Molykutty Mathew                                     Sajeesh K.P

(mnp)

/Forward by order/

Assistant Registrar