West Bengal

Siliguri

CC/13/157

SRI PRADIP KUMAR AGERWAL - Complainant(s)

Versus

THE GENERAL MANAGER, - Opp.Party(s)

23 Aug 2022

ORDER

The facts as alleged of the complainant Shri Pradip Kr. Agarwalla  is that he along with his wife Smt. Neelam Agarwala, two daughters and one son were  covered under Family Health Optima Insurance Policy of the OP-Star Health & Allied Insurance company for a sum of Rs. 03 (three) lakh and the policy was valid for 24.12.2010 to 23.12.2011. Complainant’s wife felt with pain on limp over right breast for which she had consulted Dr. Meena Vankawala on 26.08.2011 and further at Yashlok Hospital,

       Contd…P/2.

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Mumbai, on 29.08.2011 where after investigation, she was diagnosed to be suffering from breast cancer. She was admitted in Anand Hospital, Surat on 10.11.2011 and 17.11.2011 for chemotherapy and was discharged on 11.11.2011 and 18.11.2011 respectively. As per discharge summery, the Diagnosis of the disease in both the hospitalization was C.A. right breast with lung metastasis. At Yashlok Hospital   body pet-CT imaging was taken and Histopathology reports was obtained from Super Religare Laboratoria Ltd. Mumbai.

The complainant lodged his claim with the OP-Company  for Rs. 1,43,533/- and Rs. 1,88,230/-  in two separate bills on 29.01.2012 with all supporting documents regarding the medical expenses for his wife’s treatment seeking reimbursement. The OP, however, repudiated the complainant’s claim for insurance money on the ground that the disease pre-existed as per their medical teams’ observation prior to the inception of the insurance policy (i.e. on 24.12.2010) and it was not disclosed by the insured person which amounts to misrepresentation/non-disclosure of material facts and in such case, the company is not liable to make any payment as per condition no. 7 of the policy.

The complainant being aggrieved, wrote to the grievance department of the OP-Company on 15.06.2012 for review of the OP’s decision. The grievance Department by their letter dt. 18.06.2012 informed the complainant that they could not accept complainant’s contention that the disease was of origin after 24.12.2010 the date of inception of the policy as per the opinion of the company’s medical team and hence expressed their rejection stand since the claim fell under exclusion clause No.1.

The complainant was, however, not satisfied with such review result and moved the Insurance Ombudsman. The Insurance Ombudsman, having given a hearing to both complainant and the OP and  evaluating all the facts & circumstances of the case, passed an order on 27.05.2013 that the OP company had established the ground of suppression of material facts. The decision of the Insurance company to repudiate the claim as per exclusion clause no. 1/and condition no. 7 was in

       Contd…P/3.

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order and hence was uphold by the Insurance Ombudsman.

The complainant states that OP-Insurance illegally and in unjustified manner repudiated his claim on false and flimsy ground. It is further stated that such repudiation is arbitrary as neither the complainant nor his wife could know any pre-existing disease and they experienced no symptom of the said disease before commencement of the Policy. Thus the OPs showed deficiency and negligence in their duty. His attempt to get relief from the grievance department of the OP and even from the level of Insurance Ombudsman went miserably in vain and hence he liked to institute this case before this Commission to get his grievance redressed under the Consumer Protection Act, 1986, claiming, inter alia Rs. 3,00,000/= towards medical treatment of his wife, Rs. 1,50,000/- for negligence in service of the OP and loss of the complainant and Rs. 40,000/- for mental pain and agony.

The OP No. 1 to 3 entered appearance and contested this case by filing a written version wherein the material averments made in the complaint have been denied and it has been contended inter alia that the instant case is not maintainable. There was no negligence and deficiency in service and unfair trade practice on the part of the Ops. It was further stated that  insured  Smt. Neelam Agarwal was covered  under Family Health Optima Insurance Policy with a sum insured of Rs. 03 (three)  lakh with their company and the policy was valid from 24.12.2010 to 23.12.2011. She was admitted in Anand Hospital, Surat from  10.11.2011 to 18.11.2011 for chemotherapy. The diagnosis of the disease was C.A right breast with lung metastasis. She was again admitted from 17.11.2011 to 18.11.2011 for next cycle of chemotherapy. The PET CT dt. 30.08.2011 states stage IV CA right breast (+) Axillary Lymph Nodes.

Ops. have further stated that their medical expert opined that the axillary lymph nodes of more than 4 cms in size in addition to lung metastasis denotes advanced stage of disease which takes at least two years to reach the inoperable stage.  Hence the disease have been present prior to the inception of the policy dt.  24.12.2010 but the insured did not disclose the same.

       Contd…P/4.

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Finally they repudiated the claim as per condition no. 7 which runs as :-

“The company shall not be liable to make any payment under the policy in respect of any claim if such claim is in any manner fraudulent or supported by any fraudulent means or device, misrepresentation whether by the insured person or any other person acting on his behalf”.

Non-disclosure of material facts is one kind of misrepresentation.  The complainant deliberately suppressed the material facts in the proposal form and took the policy from OP-Insurance company. Hence the claim was rejected, however, with a liberty to the complainant to represent to the Departmental Grievance Cell, if the complainant have any grievance against the company’s  decision.

In exercise of that liberty, the complainant approached the grievance department. The grievance  department reviewed  the matter and passed an order dt. 18.06.2010 upholding the stand taken  by the OP Insurance company on the ground of exclusion no. 1 which reads as :-

“The company shall not be liable to make any payment under this policy in respect of any expenses whatsoever incurred  by any insured person in c/w or in respect of pre-existing disease as defined in the policy, until 48 consecutive months of coverage, have elapsed, since inception of the first policy with any Indian Insurer.”

The instant policy being the first with the wife of the complainant, no question of 48 months’ coverage arises. Pre-existing disease means, as per that  exclusion, that which existed within 48 months prior to the first policy and hence the claim of the complainant stood rejected.

The OP Insurance company produced an order dt.  27.05.2013 of the Ld. Insurance Ombudsman who held that the patient had a hard lump in right breast measuring 5x5 Cms  in

       Contd…P/5.

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addition to lung metastasis denoting  sufficiently advanced stage of disease which could not have occurred within a short period of 08 (eight) months  as claimed by the complainant and upheld the decision of the OP-Company and also of the Departmental Grievance department as per both exclusion No. 1 and condition No. 7.

The complainant, on the contrary, stated that the breast cancer of the insured was detected for the first time on 29.08.2011, after histopathology report which is after the commencement of the policy for the period from 24.12.2010 to 23.12.2011. He further claimed that the Insurance company does not have any evidence to prove that the disease was long standing and pre-existing. He  argued that the lump was first noticed on 26.08.2011 and before that she did not have any sign or symptom, and therefore she did not take any treatment before 26.08.2011.

OP No. 4, pro-forma OP, neither appeared nor contested the case. She is mere an agent of OP No. 1 as such an intermediary in between complainant and OP-Insurance company. It is alleged that complainant took insurance policy only due to the instigation and inducement. Repudiation of insurance money is the act of Ops No. 1 to 3. Agent/intermediary is or was not responsible for taking a  decision and as such the complainant did not make  any claim against her.

To prove his case, the complainant has filed the following documents:-

1. Copies of Insurance policies;
2. Copies of treatments pertaining to claim lodged by the complainant;
3. Copy of claim form duly filed up and submitted to the OP insurance company;
4. Copy of repudiation letter received from the OP Insurance company;
5. Copy of the order passed by Insurance Ombudsman.

 

 

Contd…P/6.

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POINTS FOR CONSIDERATIONS

 

1. Whether the way the OP-Insurance Company applied/implemented exclusion No. 1/condition No. 7 was prejudicial to the interest of the complainant or not?
2. Whether there is any deficiency of service/unfair trade practice on the part of the OP-Insurance company?
3. Whether the complainant is entitled  to get the reliefs as prayed for?

DECISION WITH REASONS

All the three points are taken up together for the brevity and convenience of discussion.

It is allegation of complainant that both the OP-Insurance company and their grievance department based their decision on the observation of their Medical Team. The said Medical Team report is of their own and not appointed by any independent or  3^rd party or by this Forum now Commission. The existence of the exclusion no.1 itself warrant medical test of any prospective assured. No such prior medical test may mean in other way, violation of that exclusion clause by the OPs themselves.

In the Insurance Policy Pre-existing disease has been mentioned as Pre-existing disease : Any condition, ailment or injury or retard condition(s) for which you had signs and symptoms, and/or received medical advice/treatment within 48 months prior in year first policy with any Indian Insurer.

In exclusion clause - The company shall not be liable to make any payments under this policy in respect of any expenses what so ever incurred by any insured person in connection with  or in respect of :

1. Pre-existing Disease as defined in the policy until 48 consecutive months of continuous coverage have elapsed  since inception of the first policy with any Indian Insurer, However the limit of the company’s liability in respect of Pre-existing disease under such portability shall be limited to

Contd…P/7.

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the sum insured under previous policy or policies.

Conditions 7 : The company shall not be liable to make any payment under the policy in respect of any claim if such claim is in any manner fraudulent or misreported by any fraudulent means or device, misrepresentation whether by the insured person or any other person acting on his behalf.

The OP Insurance company have cited decisions of Hon’ble  Apex Court, Hon’ble National Commission and also of Hon’ble State Commissions. Like IV(2009) CPJ 8(SC), II (2016) CPJ 132(NC), IV (2003) CPJ 308 WBSCDRC and others also.

Most of the decisions relates to suppressions of pre-existing diseases by the insured persons  or complainant in proposal form or at the time of taking insurance policies.

The complainant in his complaint has stated that the repudiation was on flimsy grounds. “ The grounds for rejection of the claim by OP Insurance company as per Annexure 5 are “ Our medical team had observed from the hospital records that the insured patient had 4 cms. auxiliary node and lung metastasis and therefore the insured patient is symptomatic for  the above disease prior to the inception of the insurance policy. The ailment of the insured patient is therefore a pre-existing disease.

At the time of inception of your first policy which is from 24.12.2010 to 23.12 2011, you have not disclosed the above mentioned medical history/health details of the insured person in the proposal form which amounts to mis-representation/non-disclosure of material facts.

As per condition no.7 of the policy issued to you, if there is any  mis-representation/non-disclosure of material facts whether by insured person or any other person acting on his behalf, the company is not liable to make any payment is respect of any claim.

We therefore regret our inability to admit your claim for the insured person under the above policy and we hereby repudiate your claim.”

Contd…P/8.

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In appeal Ld. Insurance Ombudsman has found that Insured had consulted at Jashlok Hospital, Mumbai on 29.08.2011 and after PET CT and Histopathology tests, breast cancer was  confirmed and chemotherapy treatment followed. She was hospitalised at Anand Hospital, Surat from 10.11.2011 to 11.11.2011 and subsequently from 17.11.2011 for chemotherapy. From the discharge summary it is noted that the patient had a hard lump in right breast measuring 5 cm x 5 cm in addition to lung metastasis  denoting sufficiently advanced stage of disease which could not have occurred within a short period of 8 months as claimed by the complainant. The complainant could not support his argument with any medical opinion. Since it was an advance stage of cancer, it is unlikely that patient did not experience any sign or symptom before it reached to that stage. In view of the above facts, it is concluded that the disease was pre-existing but the same was not disclosed which amounts to breach of contract.

After careful evaluation of all the facts & circumstances of the case, we are of the opinion that the insurance company has established the ground of suppression of material facts with strong documentary evidence. The decision of the insurance company  to repudiate the claim as per exclusion clause nos. 1 and 7 of the policy is in order and the same is upheld. The complaint is dismissed without any relief to the complainant.

In the Contract Act misrepresentation has been defined as (i) the positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true. (ii) any breach of duty which, without an intent to deceive, gains as advantage to the person committing it, or any one claiming under him; by misleading another to his prejudice, or to the prejudice of any one claiming under him; (iii) causing, however innocently, a party to an agreement, to make a mistake as to the substance of the thing which is the subject of the agreement.

Thus as per pre-existing disease as mentioned in the policy the insured must has ailment or injury or retard condition(s) for

Contd…P/9.

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which he  had signs and symptoms, and/or received medical advice/treatment within 48 months prior  to the  first  insurance  policy with any Indian Insurer.

So far as evidence of complainant’s side are considered he has stated that the breast cancer of the  insured was detected for the first time on 29.08.2011 after histopathology report. Further the lump was first noticed on 26.08.2011 and before that insured did not have any sign or symptom, and therefore she did not take any treatment before 26.08.2011. The commencement of the policy was for the periods from 24.12.2010 to 23.12.2011. Further the Insurance company does not have any evidence to show that the disease was long standing and pre-existing.

On the other hand it is case of Op that as per report of the medical team of the OP insurance company Axillary Lymph nodes of more than 4 cm in size in addition to Lung metastasis denotes advance stage which takes at least two years to reach the inoperative stage, so disease should have been present prior to the inception of the policy dated 24.12.2010 but the insurer did not disclose the same, so the claim has been repudiated.

The Ld. Insurance Ombudsman has also came to the view that the patient had a hard lump in right breast measuring 5 cm x 5 cm in addition to lung metastasis  denoting sufficiently advanced stage of disease which could not have occurred within a short period of 8 months as claimed by the complainant. Since it was an advance stage of cancer, it is unlikely that patient did not experience any sign or symptom before it reached to that stage. So the disease was pre-existing but the same was not disclosed which amounts to breach of contract. The decision of the insurance company  to repudiate the claim as per exclusion clause nos. 1 and 7 of the policy is in order and the same is upheld. The complaint is dismissed without any relief to the complainant.

Now let us consider the findings of medical team of insurance company and Insurance Ombudsman  with evidence of complainant and documents on record.  The insured first felt pain

Contd…P/10.

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on 26.08.2011 and after investigation disease was revealed on 29.08.2011 for breast cancer i.e. at IV stage. Thus insured got treatment of chemotherapy thereafter. Whereas as per OP’s evidence such stage could not have revealed within 8 months prior to insurance policy but Op’s here also have not showed as to how many months before such stage could have reached exactly.

Further as per Op’s insurance policy condition there must have sign & symptom or had received advice or medical treatment within 48 months prior to the issuance of the policy.

Now first thing appears to us that there are several diseases including cancer also which could not be detected at early stage unless some sign & symptoms occurs. Further it varies man to man to reveal the signs & symptoms. No straight jacket formula can be set up because in some cases signs & symptoms are found at last stage when nothing remains to be done.

Similarly even a common man also if not affected by any disease or did not feel any trouble or see any sign & symptom do not go before any doctor for consultation to show whether he has any problem or not. Further when he visit to a doctor then doctor inquire as to how many days or time he has such trouble to ascertain the duration and patient tells it to doctor and doctor note it also on the prescription or history report of the patient   as it is duty of doctor to ascertain it for treatment purpose.

Here in the instant case if the complainant has found sign & symptom on his wife or his wife (insured) had experienced any sign & symptom earlier then the complainant must had taken care for his wife (insured) and had tried his best that his wife should have been treated by famous doctors. He could not have sit idle for such long period and allowed the disease to grow more to reach at a death stage when nothing would be remain to do.

Further when insured was being treated at Mumbai by Dr. Meena Vakawala at Anand Hospital or even at Jaslok Hospital  then doctors must have inquired from patient Neelam Agarwal and she could have also stated as to since which time she is suffering

Contd…P/11.

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or has such trouble or any sign & symptom or doctors must have asked since how long back she is suffering to provide accurate treatment. In such cases doctors also inquire with the patient  for earlier treatment taken by patient or done by doctor which is recorded on history sheet of the patient. If medical report of the insured is considered then there is nothing to show that insured patient has got any sign & symptom earlier or had been treated by any doctor earlier for such disease or even had knowledge for such disease. There is no investigation team report of the OP insurance company that insured has such disease long back from the date of issuance of insurance policy.

The medical team of OP insurance company and Ld. Insurance Ombudsman have came to conclusion only on the ground that as disease was at advance stage, so insured must had sign & symptom earlier before issuance of insurance policy and such stage must have reached at least before 2 years and not within 8 months. They have concluded that as it was pre-existing disease, so there was suppression of material facts and it was not disclosed at the time of issuance of insurance policy, so it has been rightly repudiated, so their views are based on assumption of advance stage of the disease and not on the basis of medical documents available with record.

There is nothing on record which suggests that  insured had earlier signs & symptoms of the disease at least before 48 months of issuance of insurance policy and same has been concealed as alleged.

Upon consideration of the evidences produced on record we are of the view that there was no suppressions of material facts about the disease of the insured as alleged by Ops and  repudiation of the claim of the complainant by Ops are not based on evidence on record, so rejection of the claim of the complainant is prejudicial to his interest and there is deficiency in service on the part of the Ops insurance company. The complainant has suffered mental pain, agony and harassment, so the  complainant is entitled for the reliefs claimed for. Accordingly all these three

Contd…P/12.

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points are considered and decided in favour of the complainant.

Hence, it ordered,

That Consumer Complaint  no. 157 (S) of 2013 is allowed on contest with costs. The complainant is entitled for insured claim of Rs.3,00,000/- (Rupees three lac only) from OP Insurance company. The complainant is further entitled for Rs;1,50,000/- as treatment costs and Rs. 1,50,000/- (Rupees one lac fifty thousands) and Rs.40,000/- (Rupees forty thousand only) for mental pain, agony and harassment and Rs.20,000/- (Rupees twenty thousand only) for litigation costs. The complainant is further entitled for an interest @ 12 p.a. on the sum assured of Rs.3,00,000/- since the date of filing of this complaint till the date of realisation. The OPs Insurance Company are hereby directed to pay the above mentioned amounts to the complainant within 45 days from the date of this order and in default the amount shall bear Interest @ 12% p.a. till realisation. In default the complainant shall be entitled to execute the order as per law.

Let a copy this order be provided to the contesting parties free of costs.