BEFORE THE DAKSHINA KANNADA DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT MANGALORE
Dated this the 15th July 2010
COMPLAINT NO.70/2010
(Admitted on 26.02.2010 )
PRESENT:
1. Smt. Asha Shetty, President 2.Smt.Lavanya M. Rai, Member
BETWEEN:
Smt.Beefathumma,
So. K.P. Abubakkar,
Aged about 46 years,
RA. Gandhinagar,
Sullia Taluk, Dakshina Kannada. …….. COMPLAINANT
(Advocate for the Complainant: Sri.Sanjay D.)
VERSUS
1. Chief Executive Officer,
Yashaswini Co-Operative Farmers
Health Care Scheme,
6th Floor, M.S. Building,
Co-operative Secretariat,
Ambedkar Veedi,
Bangalore -1.
2. Manager,
Family Health Plan Limited,
No.45, Millars Road, Vasanth Nagar,
Bangalore – 52.
(Advocate for Opposite Party No.1 & 2: Sri.Thimmayya P.)
3. Director Medical,
Yenepoya Speciality Hospital,
Kodialbail, Mangalore -3.
(Advocate for Opposite Party No.3: Sri.Yashodhar P.Karkera)
4. Manager,
Sullia Taluk Alpasankyathara Doddapramanada
Vividoddesh Co-Operative Society,
Sullia. ……. OPPOSITE PARTIES
(Opposite Party No.4: Exparte).
***************
ORDER DELIVERED BY PRESIDENT SMT. ASHA SHETTY:
1. The facts of the complaint in brief are as follows:
This complaint is filed under Section 12 of the Consumer Protection Act alleging deficiency in service against the Opposite Parties claiming certain reliefs.
The Complainant submits that, she along with her family members became the member of Yashaswini Health Scheme of the 1st Opposite Party and has paid Rs.150/- as membership to the 4th Opposite Party Society as per receipt No.11368 and 11369 dated 25.06.2009. The same is valid for one year i.e., 25.06.2009 to 25.06.2010.
It is stated that, the 2nd Opposite Party is the third party administrator and 3rd Opposite Party is the hospital where the Complainant was treated. As per the Insurance Scheme, the 1st Opposite Party will indemnify the medical expenses to the Complainant and other members.
The Complainant admitted to the 3rd Opposite Party hospital on 27.07.2009 and diagnosed Calculous Cholecystitis Fibroid Uterus. The operation was done on the same day and she has spent a total amount of Rs.60,000/- to the above operation and discharged on 4.8.2009. It is submitted that, at the time of discharge, the 3rd Opposite Party hospital has informed the Complainant that they have sent the request for pre-authorization and claim form to the 1st and 2nd Opposite Party on 27.07.2009 but the Complainant not received any information or claim amount till today. It is submitted that, the Opposite Parties not issued the membership receipt as specified by law. Thereafter, the Complainant issued a Lawyer’s notice dated 29.01.2010. The same was served on the Opposite Parties. The 3rd Opposite Party has addressed letter dated 01.02.2010 to the 2nd Opposite Party with a copy to the Complainant. Since the Opposite Parties not paid the claim, the Complainant came up with this Complaint before this Forum under Section 12 of the Consumer Protection Act 1986 (herein after referred to as ‘the Act’) seeking direction from this Forum to the Opposite Parties to pay Rs.60,000/- with interest at 12% p.a. from 27.07.2009 till payment and also claimed Rs.20,000/- as compensation and cost of the litigation expenses.
2. Version notice served to the Opposite Parties by RPAD. Opposite Party No.1 to 3 appeared through their counsel filed separate version.
Opposite Party No.4 despite of serving notice neither appeared nor contested the case till this date. Hence we have proceeded exparte as against the Opposite Party No.4. The acknowledgement placed before the FORA marked as court document No.1.
Opposite Party No.1 and 2 admitted that the Complainant is a member of the Yashaswini Health Scheme. To avail the benefit of the scheme, the member has to follow the procedures prescribed under the scheme but the Complainant failed to follow the procedures prescribed under the scheme.
It is further stated that, the Complainant is aged only 45 years. The person aged more than 50 years are only entitled to get benefit for the treatment for the decease for which the Complainant undergone surgery with the network hospital. Since the Complainant is aged below 50 years and no pre-authorization is taken from the Opposite Party No.2, the Complainant is not entitled for any amount from this Opposite Party. Further the network hospital has not conducted proper procedure prescribed in this regard as such the Complainant is not entitled for any relief at the hands of this Forum and prayed for dismissal of the complaint.
Opposite Party No.3 submitted that, the Complainant admitted to the hospital and taken treatment of Laproscopic Cholystecomy and Vaginal Hysterectomy operation and at the time of discharge, she has paid and cleared the hospital bill. It is stated that, on discharge of the Complainant from the hospital all the related documents, papers and informations have been sent with request for the pre-authorization and insurance claim to the concerned authorities and contended that there is no deficiency of service on the part of this Opposite Party and prayed for dismissal of the complaint.
3. In view of the above said facts, the points now that arise for our consideration in this case are as under:
- Whether the Complainant proves that the Opposite Parties committed deficiency in service?
- If so, whether the Complainant is entitled for the reliefs claimed?
- What order?
4. In support of the complaint, Smt.Beefathumma (CW1) filed affidavit reiterating what has been stated in the complaint and answered the interrogatories served on her. Ex C1 to C11 were marked for the Complainant as listed in the annexure. One Sri.Poovappa (RW1), Chief Executive Officer of the Opposite Party No.1 filed counter affidavit and answered the interrogatories served on him. The Complainant and Opposite Party No.1 & 2 produced notes of arguments along with citations.
We have considered the notes/oral arguments submitted by the learned counsels and also considered the materials that was placed before the Hon'ble Forum and answer the points are as follows:
Point No.(i): Affirmative.
Point No.(ii) & (iii): As per the final order.
Reasons
5. Point No. (i) to (iii):
It is admitted that, the Complainant along with her family members are the member of the Yashaswini Health Scheme of the 1st Opposite Party and has paid Rs.150/- as membership to the 4th Opposite Party as per receipt No.11368 and 11369 dated 25.06.2009 and the same is valid for one year i.e., 25.06.2009 to 25.06.2010 (as per Ex C1). The Opposite Party also issued a I.D. number to the Complainant i.e., 0214252 (as per Ex C2). The 2nd Opposite Party is the third party administrator in this case and 3rd Opposite Party is the hospital where the Complainant was treated. It is also admitted that, the Complainant was admitted to the 3rd Opposite Party hospital for treatment of Laproscopic Cholystecomy and Vaginal Hysterectomy Operation. The Complainant was admitted on 27.07.2009 and discharged on 04.08.2009 in Yenepoya Hospital Mangalore as per the discharge summary issued by the Opposite Party hospital.
Now the dispute between the parties before this Forum is that, the Complainant underwent the above treatment in the 3rd Opposite Party hospital and spent Rs.60,000/- but the Opposite Party not settled the claim under the Yashaswini Health Scheme, hence this complaint.
The Opposite Party admitted the membership of the Complainant under the Yashaswini Health Scheme but it is contended that, the member has to follow the procedures under the Scheme. The 2nd Opposite Party did not receive required information from the hospital authority and was waiting for the experts opinion of the Gynecologist and did not receive the information. The 3rd Opposite Party has done the operation without pre-authorization. Further took a contention that, the person aged 50 years or more are only entitled to Hysterectomy operation and the Complainant is aged 45 years, she is not entitled for the reimbursement. And further contended that, the Complainant has taken treatment in special ward and she is not entitled for the reimbursement.
The Complainant filed evidence by way of affidavit and produced Ex C1 to C11 and Opposite Party also filed affidavit.
On careful consideration of the evidence on record, we find that, the Complainant along with other family members are the member of the Yashaswini Health Scheme of the 1st Opposite Party and Ex C4 produced by the Complainant i.e., a discharge summary reveals that the Complainant underwent Calculous Cholecystitis Fibroid Uterus operation with the Opposite Party No.3 hospital and Ex C5 (24 in numbers) reveals that the Complainant has spent Rs.74,327.81 towards the medical expenses.
The counsel appearing for the Complainant vehemently contended that, the Ex C2 i.e., the identity card wherein, the conditions are not mentioned and it does not bear any date and also there is no mention about when it was issued and till what period it was in force. Except the above document, nothing has been issued by the Opposite Party and argued that, the defence taken by Opposite Parties not applicable to the Complainant in this case and relied a citation reported in National Consumer Disputes Redressal Commission, New Delhi; III (2009) CPJ 246 (NC) in United India Insurance Co. Ltd and another versus S.M.S.Tele Communications and another held that - contents and meaning of exclusion clauses explained to the Complainant not proved – as per order of National Insurance Co. Ltd., versus D.P. Jain, unexplained/unnoticed exclusion clauses, not binding to insured – Exclusion Clauses required to be ignored if mandatory requirement of explaining Exclusion Clause, not adhered by insurer/Agent, before issuance of Insurance Cover.
The Complainant counsel further contended that the defence taken by the Opposite Parties are find no place in the identity card. The Complainant has kept in total darkness and no details are being told to the Complainant. The transaction is between the 1st and 2nd Opposite Party and with 3rd Opposite Party only. And further argued that, whether an operation is required or not is determined by the doctor at the hospital and not by the 1st or 2nd Opposite Party. If the patient is in need of operation and if the 1st or 2nd Opposite Party denied the preauthorization then what is the use of the system. Further argued that, the so called condition of general ward and special ward is also not given or served to the members. A person with serious injury and operation cannot be expected to go to general ward wherein the hygienic conditions are very low, when the patient operated, he needs to kept separately so as to allow him to heal faster. It is just because the insurance scheme is for farmers they cannot be treated meanly and asked to go to general ward.
We have noticed that, there is a force in the argument addressed by the Complainant because we have gone through the identity card issued by the Opposite Party, wherein, it do not disclose any terms and conditions or any details to avail the benefits. As we know, the Opposite Party has relied all the terms and conditions enumerated in the Yashaswini Health Scheme, when the Opposite Party took a contention before this Forum that, the claim of the Complainant cannot be considered, under that circumstances, it is the bounden duty of the Opposite Party to prove the terms and conditions of the policy. When the Complainant vehemently contended that, the terms and conditions of the policy was not issued, under that circumstances, the Opposite Parties should prove before the Forum that the same has been explained and accepted by the Complainant. Being aware of the existence of the policy/scheme is one thing and being aware of the contents and meaning of the clauses of the policy is another. It is not the case of the Opposite Parties that, contents and meaning of the policy/ scheme were made known to the Complainant. It is also nowhere on record that, the Opposite Parties have explained the meaning of all exclusion clauses to the Complainant or had explained the meaning of all exclusion clauses to the Opposite Party No.2 and 3 and requested them in turn to bring them to the notice of the Complainant.
The National Commission in the case of National Insurance Co. Limited versus D.P. Jain, III (2007) CPJ 34 (NC), stated supra observed as under:
9. Regulation 3 of the Insurance Regulatory and Development Authority (Protection of Policy Holders’ Interests) Regulations 2002, framed by Insurance Regulatory and Development Authority (IRDA) in exercise of powers under Section 114(A) of the Insurance Act, 1938 read with Sections 14 and 26 of the Insurance Regulatory and Development Authority Act 1999.
10. The Regulatory came into effect from the year 2002. Therefore, the policies which are issued after 2002 are being covered by the said Regulations and are required to be followed by the Insurance Company.
11. It is to be stated that the aforesaid Regulations are framed by the IRDA to protect the interests of the policy holders. Firstly, Regulation 3 requires to be followed by the insurance companies so that the terms of the insurance policy do not operate harshly against the insured and in favour of the insurer.
12. Regulation 3 thereof reads as under:
3. Point of sale – (1) Notwithstanding anything mentioned in Regulation 2(e) above, a prospectus of any insurance product shall clearly stated the scope of benefits, the extent of insurance cover and in an explicit manner explain the warranties; exceptions and conditions of the insurance cover and in case of life insurance, whether the product is participating (with profits) or non-participating (without profits). The allowable rider or riders on the product shall be clearly spelt out with regard to their scope of benefits, and in no case, the premium relatable to health related or critical illness riders in the case of term or group products shall exceed 100% of premium under the basic product. All other riders put together shall be subject to a ceiling of 30% of the premium of the basic product. Any benefit arising under each of the rider shall not exceed the sum assured under the basis product.
Provided that, the benefit amount under riders shall be subject to section 2(11) of the Insurance Act, 1938.
Explanation – the rider or riders attached to a life policy shall bear the nature and character of the main policy, viz. participating or non-participating and accordingly the life insurer shall make provisions, etc. in its books.
(2) An insurer or its agent or other intermediary shall provide all material information in respect of a proposed cover to the prospect to enable the prospect to decide on the best cover that would be in his or her interest.
(3) Where the prospect depend upon the advice of the insurer or his agent or an insurance intermediary, such a person must advise the prospect dispassionately.
(4) Where, for any reason, the proposal and other connected papers are not filled by the prospect, a certificate may be incorporated at the end of proposal form from the prospect that the contents of the form and documents have been fully explained to him and that he has fully understood the significance of the proposed contract.
(5) In the process of sale, the insurer or its agent or any intermediary shall act according to the code of conduct prescribed by-
(i) the Authority;
(ii) The Councils that have been established under Section 64C of the Act; and
(iii) The recognized professional body or association of which the agent or intermediary or insurance intermediary is a member.
From the aforesaid regulation it is clear that,
- the prospectus of insurance product are required to clearly state the scope of benefits, the extent of insurance cover and in explicit manner explain the warranties, exceptions and conditions of the insurance cover. The phraseology used is ‘mandatory’ by providing that it shall be stated clearly;
- Sub-Regulation (2) provides that an insurer or its agent or other intermediary shall provide all material information in respect of the proposed cover to the insured;
- Sub-Regulation 4 also provides that if the proposal and other connected papers are not filled by the prospect, a certificate is required to be incorporated at the end of the Proposal Form from the prospect that the contents of the form and documents have been fully explained to him.
From the above, it is amply clear that the rule making authority has taken much care to protect the interest of the consumer. But in the given case, the Opposite Parties contended that, it is not an Insurance policy, it is not doing insurance business, the 1st Opposite Party is a trust formed by the Government helping the farmers through 2nd Opposite Party and it is doing service without any profit motive. We do not understand what the trust is doing formed by the Government by way of helping the farmers through the 2nd Opposite Party. No doubt, the Government introduced the Yashaswini Health Insurance Scheme to help the farmers through the 1st Opposite Party and the Government was not directed the Opposite Parties not to follow the binding regulations. When the Opposite Party follows the binding regulations, at the same time it is mandatory in nature so as to explain the regulations/exclusion clauses to the beneficiaries/Complainant herein.
In our view, the unexplained or unnoticed exclusion clauses or regulations would not be binding to the insured. The reason being the regulations are of mandatory in nature so as to protect the consumers’ interests. The exclusion clauses are required to be ignored if the trust or its agent on intermediary does not adhere to the mandatory requirement of explaining the exclusion clauses before issuance of insurance cover. The procedure prescribed under Regulation 3(d) is required to be followed. In case the said procedure is not followed apart from aforesaid consequences, the Regulatory Authority can take action. In the given case, the Complainant has issued with the Yashaswini Health Scheme cover therefore the Opposite Party is bound to reimburse the Complainant in this case. The contention taken by the Opposite Parties cannot be made applicable to the Complainant because the same has not been explained/disclosed to the Complainant while issuing the identity card or related documents or other documents. No such information furnished to the Complainant which amounts to deficiency in service.
Under that circumstances, we hold that the Opposite Party No.1, 2 and 4 are jointly and severally liable to reimburse the medical expenses of Rs.60,000/- incurred by the Complainant along with interest at the rate of 10% p.a. from 27.07.2009 till the date of payment. And further Rs.1,000/- awarded as cost of litigation expenses. Payment shall be made within 30 days from the date of this order.
As far as Opposite Party No.3 is concerned, there is no deficiency is proved against Opposite Party No.3 hence complaint against Opposite Party No.3 is hereby dismissed.
6. In the result, we pass the following:
ORDER
The complaint is allowed. Opposite Party No.1, 2 and 4 are jointly and severally liable to reimburse the medical expenses of Rs.60,000/- (Rupees sixty thousand only) incurred by the Complainant along with interest at the rate of 10% p.a. from 27.07.2009 till the date of payment. And further Rs.1,000/- (Rupees one thousand only) awarded as cost of litigation expenses. Payment shall be made within 30 days from the date of this order.
Complaint against Opposite Party No.3 is dismissed.
The copy of this order as per the statutory requirements be forwarded to the parties free of charge and therefore the file be consigned to record.
(Page No.1 to 13 dictated to the Stenographer typed by her, revised and pronounced in the open court on this the 15th day of July 2010.)
PRESIDENT MEMBER
ANNEXURE
Witnesses examined on behalf of the Complainant:
CW1 – Smt.Beefathumma – Complainant.
Documents produced on behalf of the Complainant:
Ex C1 – 25.06.2009: Copy of the receipts (2 in numbers)
Ex C2 – : Copy of the identity card issued by the Opposite Party No.4.
Ex C3 – 27.07.2009: Copy of the self declaration.
Ex C4 – 04.08.2009: Discharge summary issued by the Opposite Party No.3.
Ex C5 – 04.08.2009: Bills issued by the Opposite Party No.3 (24 in numbers).
Ex C6 – 29.01.2010: Lawyer’s notice issued to the Opposite Parties on behalf of the Complainant.
Ex C7 to C10 - : Postal acknowledgements (4 in numbers).
Ex C11 – 01.02.2010: Reply of the 3rd Opposite Party.
Witnesses examined on behalf of the Opposite Parties:
RW1 – Sri.Poovappa, Chief Executive Officer of the Opposite Party No.1.
Documents produced on behalf of the Opposite Parties:
- Nil -
Dated:15.07.2010 PRESIDENT
