DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KOZHIKODE

PRESENT: Sri. P.C. PAULACHEN, M.Com, LLB           : PRESIDENT

Smt. PRIYA.S, BAL, LLB, MBA (HRM) :  MEMBER

Sri.V. BALAKRISHNAN, M Tech, MBA, LL.B, FIE: MEMBER

Friday 24^th day of November 2023

CC.388/2018

Complainant

Dr. Shaji Thomas John,

S/o Manampurath Oommen John,

6/107 A, Manampuram,

P.O Nadakkavu, Kannur Road,

Kozhikode -673011

(By Adv. Sri. Syam Padman)

Opposite Parties

1.          United India Insurance Co. Ltd,

24, White road,

Chennai - 600 014

(By Adv. Sri T.V. Hari)

2.            KARVAT COVERMORE Assist Pvt. Ltd,

A8, Ground floor,

Happy building, Puthiyara,

Kozhikode – 673 004.

3.           Heritag Health Insurance TPA Pvt. Ltd,

McLeod House, 3 N.S Road,

Kolkata -700 001.

4.           Ceecys Tours and Travels,

Maniyattukudy Asfa Building,

Mavoor Road, Kozhikode -673 004.

ORDER

By Sri. P.C. PAULACHEN  – PRESIDENT.

            This is a complaint filed under Section 12 of the Consumer Protection Act, 1986.

2.  The case of the complainant, in brief, is as follows:

The first opposite party is an insurance company providing a variety of insurance policies including health and travel insurance, the second opposite party is a company that provides medical assistance travel insurance by name “Trawell Tag Cover More”, the third opposite party is a third party administrator providing services to health insurance policy holders of Indian insurance companies and the 4^th opposite party is a travel agency who offers services for domestic as well as international travels.

3. The complainant, who is a doctor, booked flight tickets to Dubai, UAE for the period from 26/04/2017 to 30/04/2017 from the 4^th opposite party. The complainant sought coverage under a good travel insurance plan and accordingly requested for the same upon which, the 4^th opposite party had taken for the complainant the Trawell Tag Cover More Policy from 25/04/2017 to 30/04/2017 and remitted the requisite premium. The policy was issued to the complainant on 19/04/2017 by the first opposite party through the second opposite party, who serves as the master policy holder.
4. On 29/04/2017, while abroad, the complainant was admitted in the Incentive Care Unit of Medi Clinic City Hospital, Dubai for complaints of palpitations due to atrial fibrillation. He was discharged on 30/04/2017. During the course of his hospitalisation, the complainant contacted the first opposite party for details regarding the processing of his claim for medical insurance and later the claim form was duly filled up and sent to the Mumbai Branch of the first opposite party on 12/05/2017, requesting to reimburse the claim amount of AED 10,746/- at the earliest. On 30/05/2017 the complainant received an     e-mail from the second opposite party stating that his claim had been submitted to the claims processing agency, the third opposite party, for further processing. On 30/07/2017 the complainant sent an e-mail enquiring about the status of his claim. On 31/07/2017 the second opposite party informed the complainant that his claim had been repudiated. Later, after many follow-ups, it was revealed that his claim was rejected as the claim was “medically not payable due to past history of atrial fibrillation one year ago and hypertension”.
5. The complainant thereafter intimated the opposite parties detailing the proper and correct facts of his alleged medical condition, his past medical history without any suppression of material facts and further requested the opposite parties to reconsider his claim. On 21/08/2017 it was informed that his claim had been submitted for an expert opinion by the third opposite party. However, after many e-mails and communications requesting updates regarding the same, the complainant was informed that his claim had been rejected. Hence the complaint to refund the sum of AED 10,746/- or its current equivalent in Indian rupees (Rs. 2,14,536.95) paid by the complainant for his treatment expenses at Medi Clinic City Hospital, Dubai, along with compensation of Rs. 5,00,000/- for the loss, injury, hardship and damage caused to the complainant.
6. The first and 4^th  opposite parties have resisted the complaint by filing written version separately. The second and third opposite parties were set ex-parte.
7. The first opposite party has disputed the territorial jurisdiction. The policy is admitted by the first opposite party. The policy is subjected to the terms and conditions and exclusions. The documents submitted by the insured showed past medical history of hypertension and atrial fibrillation. The policy does not cover pre-existing diseases and related complications. The claim was repudiated for valid reason. The complainant is not entitled to claim the treatment expenses and the claim for compensation is without any basis. There was no negligence, unfair trade practice or deficiency of service on the part of the first opposite party. With the above contentions, the first opposite party prays for dismissal of the complaint with compensatory costs.
8. The 4^th opposite party has supported the claim of the complainant and according to them, they used to arrange domestic and international tours and air ticket, travel insurance etc. The complainant was issued an air ticket by them for his travel to UAE on 26/04/2017 and return on 30/04/2017. The travel insurance was arranged from the first opposite party through the second opposite party, who is their authorised agent. According to the 4^th opposite party, the complainant is entitled to be compensated for the amount he had spent for his hospitalisation and treatment abroad. 
9. The points that arise for determination in this complaint are;

                (1). Whether this Commission has territorial jurisdiction to entertain the complaint ?

                (2). Whether there was any deficiency of service on the part of the opposite parties, as alleged?

                (3). Reliefs and costs

10. Evidence consists of the oral evidence of PW1 and Exts A1 to A13 on the side of the complainant. No oral evidence was let in by the opposite parties. Ext B1 was marked on the side of the first opposite party.
11. We heard both sides. Brief argument note was filed by the complainant.
12. Point No. 1. The first opposite party has taken a contention in the written version that the policy was taken online and not from Kozhikode and so the complainant has no cause of action at Kozhikode and this Commission lacks territorial jurisdiction to entertain the complaint. It was argued by the learned counsel for the first opposite party that the mere fact that the first opposite party has an office at Kozhikode does not confer jurisdiction to this Commission. Reliance was also placed on the decision in Sonic Surgical Vs National Insurance Co Ltd - (2010)(1)SCC 135)- wherein it has been held that “the ‘expression’ branch office would mean branch office where cause of action has arisen, but not each and every branch office of the opposite party wherever it is situated”. The decision reported in 2023(4) CPR54(NC)- (Jiwan Spinners Pvt Ltd and  Anr. V/s United Insurance Co. Ltd And Anr) of the Honourable National Consumer Disputes Redressal Commission was also brought to the attention of this Commission.
13. In this context, it may be noted that the 4^th opposite party carries on business in Kozhikode. Ext A3 is the copy of the policy and it shows that the place of issuance of policy is KTSPL - Calicut. The premium was paid in Kozhikode. The repudiation of the claim happened in Kozhikode. This is clear from Ext A9 series e-mail communication between the complainant and the opposite parties. The e-mail communication dated 21/07/2017 was sent to the complainant by Sri Joy George, Business Development Manager, Calicut of the second opposite party. All the e-mail communications (Ext A9 series) are from Calicut. So the cause of action in part has arisen in Kozhikode, which is within the territorial jurisdiction of this Commission. So the complainant is legally entitled to pursue his remedy before this Commission and the complaint is perfectly maintainable before this Commission. 
14. Point No. 2 :- The complainant has approached this Commission with a grievance that the claim put in by him in connection with his treatment abroad was repudiated by the opposite parties without valid reason. The complainant is the holder of Ext A3 Trawell Tag Insurance Policy issued by the first opposite party. It is intended to be used by the insured in the event of a sudden and unexpected sickness or accident where the insured is outside the republic of India. The period of insurance in respect of the complainant was from 25/04/2017 to 30/04/2017. While abroad on 29/04/2017 the complainant was admitted in Medi Claim City Hospital, Dubai for complaints of palpitations due to atrial fibrillation and was treated. The total bill amount was AED 10,746/-. The complainant preferred claim. The claim was repudiated stating past medical history of hypertension and atrial fibrillation.         
15. In order to substantiate his case, the complainant got himself examined as PW1. PW1 has filed proof affidavit and deposed in terms of the averments in the complaint and in support of the claim. Exts A1 and A2 are the copies of the flight tickets issued  by the 4^th  opposite party, Ext A3 is the copy of Trawell Tag Cover More  Insurance Policy, Ext A4 is the copy of the discharge summary  issued by Medi Clinic City Hospital, Dubai, Ext A5 is the copy of the inpatient cash bill issued by Medi Clinic City Hospital, Dubai, Ext A6 is the copy of the claim form by Medi Clinic City Hospital, Dubai, Ext A7 is the covering letter of claim form submitted by the complainant, Ext A8 is the copy of the discharge summary and bill issued by Baby Memorial Hospital,  Kozhikode, Ext A9 series are the e-mail communications between the complainant and opposite parties, Ext A10 is the copy of the letter sent by the complainant, Ext A11 series are the lawyer notice, postal receipt and postal acknowledgment card, Ext A12 is the reply notice issued by the 4^th opposite party and Ext A13 is the copy of the print out from the website of India Post.
16. The 4^th opposite party has supported the case of the complainant. The stand taken by the insurance company is that complainant had past medical history of hypertension and fibrillation and the policy does not cover any pre-existing disease and related complications. The first opposite party did not adduce any evidence. The copy of the policy with terms and conditions produced by the first opposite party is marked as Ext B1.
17. Ext A9 series shows that claim was repudiated for the reason that the claim was “medically not payable due to past history of atrial fibrillation one year ago and hypertension”. The specific case of the first opposite party is that the documents submitted by the complainant would reveal past medical history of hypertension and atrial fibrillation. Ext A8 discharge summary issued from the Baby Memorial Hospital, Kozhikode shows that on 1/07/2015 the complainant was admitted with complaints of persistent vomiting, giddiness, palpitation and generalised tiredness in that hospital. The diagnosis was paroxysmal AF acute gastritis.
18. The Hon’ble  Apex Court in 2021 (0) Supreme (SC) 779 - (Manmohan  Nanda V/s United India Insurance Company Limited)  has observed as follows; (paragraph 52)

     “On a consideration of the aforesaid judgments, the following principles would emerge:

     (!). There is a duty or obligation of disclosure by the insured regarding any material fact at the time of making the proposal.  What constitutes a material fact would depend upon the nature of the insurance policy to be taken, the risk to be covered, as well as the queries that are raised in the proposal form.

 (!!). What may be a material fact in a case would also depend upon the health and medical condition of the proposer.

(!!!). If specific queries are made in a proposal form then it is expected that specific answers are given by the insured who is bound by the duty to disclose all material facts.

(!!!!). If any query or column in a proposal form is left blank then the insurance company must ask the insured to fill it up. If in spite of any column being left blank, the insurance company accepts the premium and issues a policy, it cannot at a later stage, when a claim is made under the policy, say that there was a suppression or non-disclosure of a material fact, and seek to repudiate the claim.

(v). The insurance company has the right to seek details regarding medical condition, if any, of the proposed by getting the  proposer examined by  one of its empanelled doctors. If, on the consideration of the medical report, the insurance company is satisfied about the medical condition of the proposer and that there is no risk of pre-existing illness, and on such satisfaction it has issued the policy, it cannot thereafter, contend that there was a possible pre-existing illness or sickness which has led to the claim being made by the insured and for that reason repudiate the claim.

 (vi). The insurer must be able to assess the likely risks that may arise from the status of health and existing disease, if any, disclosed by the insured in the proposal form before issuing the insurance policy. Once the policy has been issued after assessing the medical condition of the insured, the insurer cannot repudiate the claim by citing an existing medical condition which was disclosed by the insured in the proposal form, which condition has led to a particular risk in respect of which the claim has been made by the insured.

(vii). In other words, a prudent insurer has  to gauge  the possible risk that the policy would have to cover and accordingly decide to either accept the proposal form and issue a policy or decline to do so. Such an exercise is dependent on the queries made in the proposal form and the answer to the said queries given by the proposer.”

19. In this context, it is worthwhile to have a glance at the decision of the   Hon’ble National Consumer Disputes Redressal Commission in Arum  Kumar vs. New India Assurance Company Ltd., reported in III (2017) (CPJ) 553 (NC) wherein it has been held as follows: “It is not denied that the complainant has been taking the insurance policy since the year 1997. It was the bound duty of the Insurance Company to have verified the information given in the proposal form by obtaining the suitable expert opinion. In case certain column in the proposal form were left blank, it was obligatory on the Insurance Company to ask him to fill the required information, before taking decision to issue the insurance policy. It is a matter of grave concern that the Insurance Companies,  whether in the public sector or the private sector, do not make any effort to examine the proposal properly or get the necessary verification done, at the time of issuing the policies in question. However, when the claims are filed, minute scrutiny starts at that stage and the claims are repudiated, even for minor lapses on the part of the proposer. In the present case, the discharge summary of Sitaram Bharatiya Hospital stated that the complainant had difficulty in walking for a long time and history of borderline hypertension, but not on any medication. The District Forum had rightly observed that non-disclosure of such conditions in the proposal form cannot be blown out of proportion, so as to disentitle the complainant from the claim amount from the Insurance Company. We have no reason to differ with the conclusion arrived at by the State Commission, because the conditions so mentioned in the report of the hospital, do not imply that the complainant was suffering from any serious disease. It is held, therefore, that the claim has been wrongly repudiated by the Insurance Company on the ground of non-disclosure of information about the health conditions in the proposal form.”
20. The complainant has filled up the proposal form and furnished all relevant information. The proposal form is not forth coming to verify whether there was any suppression of material fact by the complainant. On a perusal of Ext A3 it can be seen that only the basic information such as the name of the complainant and his contacts etc. were only required by the opposite parties. Under the head of insurance details, only information like commencement date, end date, number of days, plan name, geographical coverage, assignee and the relation to assignee were asked for. Reports were not asked for and regarding reports it is noted “not required”. The sub head pre-existing diseases excluded is left blank. If the complainant has suppressed the material fact of pre-existing disease, it is for the opposite parties to prove the same. The first opposite party has failed to produce any evidence regarding the pre-existing disease suffered by the complainant at the time of applying for the policy. There is no evidence to show that medical test or examination of the complainant was made before the issuance of the policy. In  S S. Jaspal vs  National Insurance Co Ltd and Ors was (IV)(2022)CPJ 26 (DEL), it has been held that common life style diseases like diabetes and hypertension cannot be treated as pre-existing diseases and cannot be a ground of repudiation of the claim  by the insurance company. In Appolo Munic Health Insurance Co. Ltd. Vs Sasidharan Nair reported in (III)(2022)CPJ 133 (KER) it has been held that mere mention about existence of disease in the discharge summary alone is not a sufficient reason for the rejection of the claim and repudiation of the claim on the sole basis of entry in discharge summary without any supporting documents is unreasonable.
21. Further, it may be noted that there is absolutely no nexus between the alleged pre-existing condition and the present treatment for which the claim was lodged. Ext A8 shows that the complainant was discharged in a stable condition. He was only monitored for a few hours in the ICU and showed no further recurrence of arrhythmias and was mobilized and discharged in a stable condition. This has been clearly mentioned in Ext A8. There is no nexus  between the past history and present treatment of the complainant regarding which the claim was made, as in both situations, he was declared fit and stable and was neither issued any long term meditation nor was he hospitalized persistently as a result of atrial fibrillation. The hospitalization was for one day only. The hyper tension may be a manifestation of the complainant’s age which is 60 years. PW1 has deposed that hypertension is well controlled and therefore considering it as a pre-existing condition is not justified. The first opposite party could not show that the alleged pre-existing condition has nexus with the present treatment of the complainant for which the claim has been preferred.
22. The first opposite party have not produced any evidence to prove as to how they have concluded about the pre-existing medical condition. No expert recommendation of a medical board or by any approved medical practitioner is produced.
23. Further in paragraph 69 of the decision in 2021 (0) Supreme (SC) 779 - (Manmohan  Nanda V/s United India Insurance Company Limited)  it has been held by the Hon,ble Apex Court that “The object of seeking a medi calim policy is to seek indemnification in respect of a sudden illness or sickness which is not expected or imminent and which may occur overseas. If the insured suffers a sudden sickness or ailment which is not expressly excluded under the policy, a duty is cast on the insurer to indemnify the appellant for the expenses incurred thereunder”.
24. From the above discussion, what emerges is that the claim was wrongly repudiated by the insurance company. Their act in wrongly repudiated the claim and thereby denying the legitimate claim amounts to gross deficiency in service. The complainant is entitled to get the claim amount of AED 10,746/- (Rs. 2,14,536.95) from the first opposite party. It goes without saying that the act of the insurance company has caused mental agony and hardship to the complainant and he is entitled to be compensated adequately. Considering the entire facts and circumstances, we are of the view that a sum of Rs. 25,000/- will be reasonable compensation in this case. The complainant is also entitled to get Rs. 5,000/- as cost of the proceeding.
25. Point No. 3:- In the light of the finding on the above points, the complaint is disposed of as follows;

                  a)  CC.388/2018 is allowed in part.

b) The first opposite party is hereby directed to pay the complainant a sum of Rs. 2,14,536.95/- (Rupees two lakhs fourteen thousand five hundred and thirty six and ninety five paise only) with interest @ 6%  per annum from the date of the complaint ie. 31/12/2018 till actual payment.

c) The first opposite party is directed to pay a sum of Rs. 25,000/- (Rupees Twenty Five Thousand only) to the complainant as compensation for the mental agony and hardship suffered.

d) The first opposite party is directed to pay a sum of Rs. 5,000/- (Rupees Five Thousand only) as cost of the proceedings to the complainant.

 e) The order shall be complied with within 30 days of the receipt of copy of this order.

Pronounced in open Commission on this, the 24^th day of  November, 2023.

Date of Filing: 31/12/2018

                                    Sd/-                                                              Sd/-                                                Sd/-

                            PRESIDENT                                                 MEMBER                                      MEMBER

APPENDIX

Exhibits for the Complainant :

Ext A1 - The copy of the flight ticket issued by the 4^th opposite party.

Ext A2 - The copy of the flight ticket issued by the 4^th opposite party.

Ext A3 - Copy of Trawell Tag Cover More Insurance Policy,

Ext A4 - Copy of the discharge summary issued by Medi Clinic City Hospital, Dubai,

Ext A5   - Copy of the inpatient cash bill issued by Medi Clinic City Hospital, Dubai, Ext A6    - Copy of the claim form by Medi Clinic City Hospital, Dubai,

Ext A7    - Covering letter of claim form submitted by the complainant,

Ext A8 - Copy of the discharge summary and bill issued by Baby Memorial Hospital,  Kozhikode,

Ext A9 series – The e-mail communications between the complainant and opposite parties,

Ext A10 - Copy of the letter sent by the complainant

Ext A11 series - Lawyer notice, postal receipt and postal acknowledgment card,

Ext A 12 -  Reply notice issued by the 4^th opposite party

Ext A 13 -  Copy of the print out from the website of India Post.

Exhibits for the Opposite Party

Ext B1 -  Copy of the policy with terms and conditions produced by the first opposite party.

Witnesses for the Complainant

PW1 -  Dr. Shaji Thomas John (Complainant)

Witnesses for the opposite parties 

 Nil

                                     Sd/-                                                             Sd/-                                                      Sd/-

                              PRESIDENT                                               MEMBER                                           MEMBER

True Copy,

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                                                                                                                                              Assistant Registrar