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

DATED 08^TH DAY OF JULY 2024

ORDER

SMT.M.SHOBHA, PRESIDENT

1. The complaint has been filed under Section 35 of C.P.Act (hereinafter referred as an Act) against the OP for the following reliefs against the OP:-

1. Direct the OP to pay Rs.3,85,000/- towards hospital expenses and discharge amount with interest @ 24% p.a.,
2. Direct the OP to pay Rs.2,00,000/- towards compensation.
3. To grant costs of the proceedings and to pass such other suitable relief which this Hon’ble Commission deems fit.

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

The complainant and his family were having insurance policy with the oriental insurance company limited in the year 2013 and the policy was in the name of happy family floater policy schedule.  The said policy was continued by renewing every year and was paying premium regularly to the company till 2020.  In the mean time, OP authorized agents have convinced the complainant to make health insurance policy with their company instead of oriental insurance company wherein they provide all health benefit better than the Oriental insurance company.  The complainant was convinced by the OP that for any disease caused they will provide cashless treatment to the complainant.  Further the OP have assured the complainant that they would get cashless benefit immediately if the complainant get any health related issue or diseases.  

3. The complainant believing the words of the OP made insurance policy with the OP bearing No.141142/01/2022/004595 dated 16.12.2021 and paid premium of Rs.27,092/- instead of renewing the health policy with the Oriental insurance company.  The OP has further collected the premium of Rs.38,765/- from the complainant towards renewing policy for the year 2022-23.

4. The complainant for the first time was suffering from prostate problems in the second week of January 2022.  As per the advise of the doctor at Bangalore Hospital, R.V.Road, the complainant has undergone medical tests regarding CBC, PSA, Urine return, L/S abdomen and Pelvis etc., from the hospital laboratory.   The doctor has diagnosed the urine problem of the complainant and came to know he was suffering from prostate problems and it is enlarged with median lobe protruding to bladder base. The doctor has immediately advised the complainant to undergo surgery. The complainant was admitted to hospital on 03.02.2022 for the operation wherein the complainant has informed the OP and requested to provide cashless treatment. The OP have initially approved Rs.60,000/-. Thereafter, the complainant has further requested the OP on 06.02.2022 for further enhancement of the amount of cashless treatment. The OP has withdrawn the earlier approved amount of Rs.60,000/- and rejected the whole claim of the complainant on the ground that it is pre existing disease as on the date of doing insurance policy.

5. The complainant who is a poor unable to bare the hospital expenses with great difficulty discharged from the hospital by paying an amount of Rs.3,06,647/-.  The complainant in total spent Rs.3,85,000/- for the tests and diagnosis conducted before his admission to the Forties Hospital. The complainant has raised hand loan and paid Rs.3,06,647/- and discharged on 07.02.2022.

6. It is further case of the complainant that he is not having any pre existing disease as alleged by the OP.  The doctor has also opined that the complainant was suffering from the said disease from last two weeks from the date of admission to the hospital.  The complainant has also registered a complaint before the Insurance Ombudsmen but they failed to take action and failed to settle the claim of the complainant.  Hence the complainant without having any other alternative have filed this complaint and prays for allow the complaint.
7. In response to the notice, OP appears and files version stating that the OP have admitted about the insurance policy taken by the complainant and the validity of the policy from 29.12.2021 to 28.12.2022.  The complainant has reported claim in the first year of the medical insurance policy.  They have further admitted about the treatment taken by the complainant for his prostamegaly and raised a request for cashless treatment.  As per the authorization request letter complainant has claimed an amount of Rs.2,90,000/-.  This OP have approved the pre authorization request to avail cashless facility of Rs.60,000/- on 01.02.2022.

8. It is further case of the OP that on perusal of the claim documents and also from the medical records that insured complainant was suffering from this disease since May 2021 and is symptomatic for past two years which is prior to inception of the first policy. Hence it is a pre existing disease/condition. The complainant has failed to disclose this in his proposal form at the time of portability or inception of the first policy.
9. It is further case of the OP that

As per the waiting period/exclusion No.Excl.10 of the policy, the claim for treatment of the disease/condition is not admissible until the expiry of 12 months from the date of admission.

10. Thereafter the OP was unable to settle the claim made by the complainant under the above policy and they have repudiated the claim as per the terms and conditions of the policy.  after rejection of the claim for cashless the complainant has approached the Insurance Ombudsmen and the Insurance Ombudsmen passed an award and disallowed the complainant holding that the rejection of the claim by the OP insurer on the ground of non disclosure of the medical history prior to policy inception is found to be in order and it is in consonance with the terms and conditions of the policy and uphold the repudiation made by the OP.  After that the complainant has filed this complaint before this Commission. There is no cause of action for this complaint. The relief sought towards hospitalization expenses is not payable by this OP as per the policy terms. Hence OP prays for dismissal of the complaint.

11. The complainant has filed his affidavit evidence and relies on 09 documents.  Affidavit evidence of OP has been filed and OP relies on 08 documents.

12. Heard the arguments of advocate for both the parties.  Perused the written arguments filed by OP with documents and citations.

13. The following points arise for our consideration as are:-

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?

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

Point No.1:  Affirmative

Point No.2: Affirmative in part

Point No.3: As per final orders

REASONS

15. Point No.1 AND 2: These two points are inter related and hence they have taken for common discussion.  We have perused the allegations made in the complaint, version, affidavit evidence of both the parties, written arguments and documents filed by both the parties.

16. It is undisputed fact that the complainant was covered under the family floater health insurance policy of Oriental insurance company limited since 2013. An insurance advisor from OP approached the complainant in December 2021 to port his policy to their company.  He has also insisted the complainant and also informed him that all the benefits under the previous insurer will be restored in the ported policy with OP.

17. The complainant had urinary track infection in January 2021 and he has consulted the doctor and the doctor has advised him to go for surgery.  After informing the OP the complainant has admitted to the hospital.  The OP have honored his request initially for approval of Rs.60,000/- cashless benefit and thereafter they have withdrawn the approval at the time of discharge on 06.02.2022 and they have also rejected the claim stating that the complainant has not disclosed and it is a pre existing disease.

18. In support of his contention the complainant has filed his affidavit evidence and relied on 09 documents. Ex.P1 is the copy of insurance policy issued by the Oriental insurance company limited, Ex.P2 is the copy of the insurance policy issued by OP, Ex.P3 is the copy of the laboratory reports, Ex.P4 is the copy of the letter dated 01.02.2022 issued by OP for approval of cashless treatment, Ex.P5 is the copy of the letter dated 06.02.2022, Ex.P6 is the copy of the Forties Hospital discharge summary and bills,   Ex.P7 is the copy of the complaint registered by the complainant before the Ombudsman and acknowledgement, Ex.P8 is the copy of letter issued by the Forties hospital dated 01.02.2022.

19. There is no dispute by the OP about the issuance of the policy and the earlier policy taken by the complainant and also further admitted about the admission of the complainant to Fortis hospital to Bangalore on 01.02.2022.  The OP further stated that the complainant was diagnosed with enlarged prostate and Detrusor overactivity with outlet obstruction.  As per the pre authorization request the complainant has claimed an approval for Rs.2,90,000/- to avail cashless facility.  The request of the complainant was repudiated after verification of the medical documents of the complainant.  It is clear from the medical documents that the complainant was suffering from lower urinary track and widening symptoms for two years that is prior to the porting of the policy. Hence it is treated as pre existing disease and the OP have rejected the claim of the complainant and communicated to the complainant on 06.02.2022.     

20. On the other hand, Assistant Manager, Legal of the OP company has filed his affidavit evidence and relied on 08 documents. Ex.R1 is the copy of the proposal form, Ex.R2 is the copy of the Portability form A,, Ex.R3 is the copy of the policy schedule, Ex.R4 is the copy of policy terms and condition, Ex.R5 is the copy of the pre-authorisation form with documents, Ex.R6 is the Query reply with documents, Ex.R7 is the cashless claim rejection letter and Ex.R8 is the Ombudsman award. 

21. The Ex.P8 clearly discloses that the insurance Ombudsmen have disallowed the complaint filed by the complainant holding that the rejection made by the OP on the ground of non disclosure of the past medical history prior to the policy inception is found to be in order and it is in consonance with the terms and conditions of the policy and it does not require any interference.

22. It is undisputed fact that the complainant was under the family health optima insurance policy from OP since 29.12.2021 and he was earlier covered by the family floater health insurance policy of the oriental insurance company since 29.12.2016.  The policy inception date is 29.12.2016.  The complainant was diagnosed and he was admitted to Fortis hospital and taken treatment from 03.02.2022 to 06.02.2022 where he undergone Cystoscopy +Intravesical BootXInjection+Laster Turp Under GA on 04.02.2022.

23. It is also undisputed fact that before taking the policy from the OP the complainant and his family was having the valid insurance policy from 29.12.2016 till the inception of the policy of the OP dated 29.12.2021.  The OP have rejected the claim of the complainant on the ground that none disclosure of past medical history. As per the medical history the complainant was having this problem from the last two weeks prior to the admission to the hospital.

24. On this back ground we have gone through the decision cited by the complainant passed by the Hon’ble Supreme Court of India in Civil appeal Nos.2769-2770/2023 dated July 04, 2023 between Om Prakash Ahuja –vs- Reliance General Insurance Co. Ltd., etc., stating that the

“Medical Insurance – Once there is a valid insurance policy in favour of a person, the claim for reimbursement of the expenses incurred must be paid.  Once the insurance company has accepted that concealment of a disease at the time of purchasing the policy was not material as it was not related to the disease that caused death, it cannot later refuse further claims or renewal of insurance policy on the same ground.”

25. The complainant has also relied on the decision of the Hon’ble NCDRC between Ravi Kumar –vs- United India Insurance Co. Ltd., it is clearly held by the Hon’ble NCDRC that the decision of the Ombudsmen is not binding on the complainant and hence the complaint preferred by the complainant is maintainable u/s 2(1)(d) of the C.P.Act.
26. The complainant has also relied on the by the order passed by the Nizamabad District Consumer Commission in CC No.54/2020.
27. It is clear from the above decision that the OPs have not made the medical test reports of the deceased/insured available to the investigator as a part of investigation. The OP neither proved the decease of diabetes of hypertension nor the decease have any bearing on the cause of death as there is no evidence to that effect on record. Hence the repudiation of death claim by the insurance company on the ground of non disclosure of the said disease by the insured at the time of taking the policy cannot therefore be accepted as valid.  The court further held that the fact of insured suffering from diabetes and hypertension said to have been suppressed by him at the time of taking the policy cannot be termed as material fact since no relation between the said disease and the cause of death could be established on record. Hence the District Commission has allowed the complaint and directed the insurance company to refund the medical expenses.

28. It is clear from the above decisions that the order passed by the Ombudsmen is not binding on the complainant and the complaint is maintainable. Once there is a valid insurance policy in favour of a person, the claim for reimbursement of the expenses incurred must be paid.  Once the insurance company has accepted that the concealment of the disease at the time of purchasing the policy was not material as it was not related to the disease.  It cannot later refused further claims or renewal of insurance policy on the same ground.

29. The facts and circumstances in the above cited decision and in this case are similar.  The complainant was having the insurance policy from Oriental Insurance company from 2016 till the date of taking the policy from the OP from 29.12.2021. At the time of issuance of the policy it is the duty of the OP to conduct the medical examination to know anything about the preexisting disease of the insurer.  The OP has taken this contention and repudiated the claim of the complainant when the complainant has submitted the claim for the medical expenses for taking treatment for surgery.  The OP has raised the objection and repudiated the claim three months after issue of the policy.  The conduct of the OP clearly discloses that they have repudiated the claim only with an intention to avoid making payment to the complainant.  The OP is failed to establish that the complainant was suffering from pre existing diseases, prior to issuance of the policy from their company they are liable to refund the amount spent by the complainant towards medical expenses.
30. Under these circumstances, the complainant has clearly established the deficiency of service and unfair trade practice on the part of the OP. Hence complainant is entitled for the relief. Therefore, we answer point No.1 in affirmative and point No.2 partly in affirmative.

31. Point No.3:- In view the discussion referred above we proceed to pass the following;

O R D E R

1. The complaint is allowed in part.
2. OP is hereby directed to pay Rs.3,85,000/- with interest at 9% p.a., from the date of repudiation of the claim till realization.
3. OP is further directed to pay compensation of Rs.50,000/- within litigation expenses of Rs.10,000/- to the complainant.
4. The OP shall comply this order within 60 days from this date, failing which the OP shall pay interest at 12% p.a. after expiry of 60 days on Rs.3,85,000/- till final payment.
5. Furnish the copy of this order and return the extra pleadings and documents to the parties.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 08^TH day of JULY 2024)

Documents produced by the Complainant-P.W.1 are as follows:

Documents produced by the representative of opposite party – R.W.1;