CONSUMER DISPUTES REDRESSAL FORUM
Palakkad, Kerala
Dated this the 17th day of November 2015
PRESENT : SMT. SHINY.P.R , PRESIDENT Date of filing: 18/10/2014
: SMT. SUMA K.P, MEMBER
CC/ 159/2014
P.S.Subinson,
S/o.Simon, residing at
Karunnia, T.B.Road, Palakkad. : Complainant
(By Adv.A.B.Prasad)
Vs
- The Manager,
M/s.Star Health and Allied
Insurance Co.Ltd, No.1
New Tank Road, Valluvarkottam
High Road, Nungambakkom, : Opposite parties
Chennai, Tamilnadu.
(By Adv.K.Dhananjayan)
- The Manager,
M/s.Star Health and Allied
Insurance Co.Ltd,
Fine Centre, 4th Floor,
T.B.Road, Palakkad.
(By Adv.K.Dhananjayan)
O R D E R
By Smt. Shiny. P. R. President.
Brief facts of the complaint :- The complainant had taken a Medical Policy having No.P.181214/01/2013/001806 for the period from 22/08/2012 to 21/08/2013 from the opposite parties. Complainant submitted that he had been hospitalized at Lake Shore Hospital and Research Centre from 8/8/2013 to 13/08/2013 and was under the treatment of Dr.George P.Abraham. An amount of Rs.1,22,548.04 had spent for the treatment. The complainant had to undergo a surgery also. Allegation of the complainant is that as per the terms of the Policy the opposite parties did not reimburse the treatment expenses to the complainant. The complainant made a request to the opposite party for reimbursement of the amount. But the opposite parties repudiated the claim by sending letter dtd,26/11/2013. It is stated in this letter that the complainant had pre-existing disease and that since the illness had commenced prior to the date of inception of the policy, it falls under exclusion clause No.1 of the policy. It is also stated that the complainant had suppressed this fact and obtained the policy without disclosing the full facts on health of a person would make the insurance policy void ab initio. The prior disease mentioned in the reply has nothing to do with the disease for which the complainant was treated at Lake Shore Hospital. The exclusion clause 1 of the Policy is not applicable to the disease and treatment which the complainant had at the Lake Shore Hospital. Pre-existing disease as per the policy can mean only any condition, ailment or injury or related conditions for which the insured person had signs or symptoms before 48 months prior to the taking of the policy. Any disease in 2005 will not be attracted to a policy taken in 2011.
Complainant submitted that the repudiation of the claim amounts to unfair trade practice and deficiency in service on the part of the opposite parties. The complainant sent a lawyer notice to the Grievance Cell and also to the Manager at Palakkad Branch on 18th May 2014. After receiving the same they sent a reply notice dated 13/8/2014 stating false and frivolous allegations. The opposite parties not settled the claim of the complainant so far. Hence the complaint.
Complainant prays for an order directing the opposite parties to pay the amount of Rs.1,22,548/- which was spent by the complainant for treatment together with interest thereon at 18% p.a from 22/8/2012 till date of payment and to pay compensation of Rs.25,000/- to the complainant for the mental pain and agony caused to him.
Opposite parties filed their version contending the following:
The opposite party admitted the policy issued for the period from 22/08/2011 to 21/08/2012 which has been further renewed up to 21/08/2013. It is submitted that insurance contracts are “contracts of uberimefide”. The opposite parties issued the policy on good faith based on the declaration made by the proposer/insured in the proposal form. Proposal form is the basis and integral part of the insurance contract, on which the policy is issued. As per the contract of the insurance the insured has to furnish true and correct facts in the proposal form for issuing the policy.
The complainant herein had admitted the terms, conditions and exclusions set in the policy and thereafter has signed in the proposal form of the policy.
Opposite parties contented that discharge summary submitted by the complainant reveals that he was admitted on 08/08/2013 at Lakeshore hospital for the treatment of left renal calculi with PUJ obstruction left lower ureteric calculus for which the procedure done was left RGP, left PCNL & DJ stenting on 09/08/2013 & after treatment he was discharged on 13/08/2013.
It is submitted that the opposite parties had received a pre authorization request form from the hospital in connection with the treatment for availing cashless benefit. In the request form history of past illness relevant to present illness has been recorded as “ PCNL with endopyelotomy – 2005. Provisional diagnosis was shown as “ Left renel calculi”. The complainant had suppressed the pre-existence of the illness. Since the complainant had suppressed the existence of the illness in the proposal form, the opposite parties denied the cashless benefit on the ground of suppression of material facts and the reason for rejection was duly intimated to the hospital authorities on 08/08/2013.
Then the complainant had submitted a claim before the company for the reimbursement of the medical expense along with the medical records. In the claim form, the treating doctor has recorded in column no.5 (a) of the medical certificate that the date of first consultation of the doctor as 17/01/2005. The opposite parties had perused the medical records of the complainant and repudiated the claim vide its letter dtd.26/11/2013. And the reason for rejections was suppression of material facts regarding the existing illness.
It is submitted that the complainant had not mentioned any diseases in the health history columns of the proposal form. Based on the declaration of the complainant and believing his declaration, the policy was issued to him. In the proposal form the complainant further declare that if after the insurance policy is effected, any particulars stated in the proposal form are found incorrect, the insurance company would incur ‘no liability’ under the policy. If the insured person discloses the facts of previous diseases, a decision will be taken by the opposite party whether to accept or reject the proposal. But in this case the insured has not informed about the pre-existing diseases and its treatment in the proposal form though he had knowledge about his previous illness for which he was under treatment in 2005.
Since there is a suppression of material facts, then the insurance contract becomes void from the beginning and the company is not liable to indemnify the insured. The hospital records confirmed that the complainant had treated for renal disease in 2005 also.
The opposite parties denied the averments made by the complainant in para 2 of the complaint that the insurance company is liable for all the hospitalization expenses incurred during the policy period. It is submitted that the claim is admissible subject to terms, conditions, definitions & exclusions expressed in the policy.
There is no deficiency in service from the part of the opposite parties.
Opposite parties also submitted that the complainant has filed this complaint vexatiously and frivolously for the sole purpose of harassing the opposite party with intention for getting unlawful enrichment from the opposite party 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 condition correctly. In this case the insured, has not revealed the pre-existing illness in the policy and has tired to defraud the company by suppressing the existing illness and trying to get compensation for the treating such an illness. Hence the policy was vitiated by the element of fraud.
The opposite party is entitled to get compensatory cost from the complainant for the reason that (1) the complainant was suffering from renal disease for which he was under medication before the inception of the policy, (2) the insured had suppressed his existing diseases in the proposal form for obtaining policy & (3) moreover the complainant dragged the opposite parties into an unnecessary litigation knowing well that the treatment false under the exclusions as per policy.
The evidence adduced by the complainant consists of his chief affidavit and Ext. A1 to A4. Opposite parties filed their chief affidavit. No documentary evidence from the part of opposite parties.
The following issues are to be considered.
1. Whether there is any deficiency in service from the part of opposite parties?
2. If so, what is the relief and cost?
ISSUES 1 & 2
Heard. We have perused the documents filed. The opposite parties admit the policy issued to the complainant for the period from 22/08/2011 to 21/08/2012 and it was further renewed up to 21/08/2013. Opposite parties have no dispute with regard to the treatment taken by the complainant in Lake Shore Hospital. Opposite parties also admit that complainant had submitted a claim before the company for the reimbursement of the medical expense along with the medical records and they issued Ext A2 letter to the complainant. The opposite parties contended that Complainant had pre existing disease which was recorded by the treating doctor in column no.5 (a) of the medical certificate as the date of first consultation of the doctor as 17/01/2005. Opposite parties submitted that hospital records confirmed the fact that the complainant was treated for renal disease in 2005.
According to the opposite parties, since complainant has not informed about the pre-existing diseases and its treatment in the proposal form though he had knowledge about his previous illness for which he was under treatment in 2005, insurance contract becomes void from the beginning and the company is not liable to indemnify the insured. Opposite parties admitted in their version and chief affidavit that all the records are produced by the complainant before them for getting claim. In these circumstances opposite parties ought to have produce all documents before the forum to prove their contentions. They did not do so.
Moreover Opposite parties did not take any steps to cross examine complainant to prove that he had suppressed the material facts about the pre existing disease. Opposite parties also not examined the treating doctor of the complainant to prove their contentions. The burden to prove that the insured has fraudulently suppressed material fact is on the insurer i.e, opposite parties. In the absence of such evidences, it can very safely be concluded that the opposite parties committed deficiency in service by repudiating the claim of the complainant. Since the opposite parties have not raised any objection in the hospital expenses, opposite parties have the liability to pay hospitalization expenses of Rs.1,22,548/- to the complainant. Opposite parties are also liable to pay compensation for mental agony suffered by the complainant.
Hence we allow the complaint. Opposite parties are jointly and severally liable to pay the hospitalization expenses of Rs.1,22,548/- /-(Rupees One lakh twenty two thousand five hundred and forty eight only) and Rs.10,000/- (Rupees Ten Thousand only) as compensation for mental agony along with cost of Rs. 2000/-(Rupees Two Thousand only) to the complainant within one month from the date of this order.
Order shall be complied within one month from the date of receipt of order, failing which the complainant is entitled for 9% interest for the whole amount from the date of order till realization.
Pronounced in the open court on this the 17th day of November 2015.
Sd/- Smt. Shiny. P.R
President
Sd/-
Smt. Suma K.P Member
APPENDIX
Exhibits marked on the side of the complainant
Ext.A1 - Copy of the policy taken by the complainant from opposite party dt.22/08/2012 (Photocoy)
Ext.A2 – Repudiation letter sent by the opposite party dt.26/11/2013
Ext.A3- Copy of lawyer notice sent to the opposite parties with postal receipt and Ack. card dt.19/5/2014
Ext.A4- Reply notice dtd. 13/08/2014 sent by opposite party through Adv.Mann Jananrdhanam Nair (Original)
Exhibits marked on the side of the opposite parties
Nil
Witness examined on the side of complainant
Nil
Witness examined on the side of opposite parties
Nil
Cost allowed
Rs.2,000/- as cost
