State Consumer Disputes Redressal Commission
Oriental Insurance Co. Ltd. vs Romesh Suri And Anr. on 31 October, 2017
Daily Order IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL, COMMISSION : DELHI (Constituted under Section 9 of the Consumer Protection Act, 1986) Date of Arguments : 31.10.2017 Date of Decision :15.11.2017 First Appeal No.195/2010 IN THE MATTER OF: The Oriental Insurance Company Ltd., D.O.2 16/20, WEA, Padam Singh Road, Karol Bagh, New Delhi. ......Appellant Versus 1. Mr. Romesh Suri, (deceased) Through LRs 1.(a) Ms. Mona Suri C-342, 1st Floor, Defence Colony, New Delhi-110024. 1.(b) Mr. Gaurav Suri, C-342, 1st Floor, Defence Colony, New Delhi-110024. 1.(c) Ms. Rachna Suri C-342, 1st Floor, Defence Colony, New Delhi-110024. ....Respondent No.1 2.Genins India Ltd. Corporate Office, D-60, Sector-2, Noida-201301. ....Respondent No.2 HON'BLE SH. O.P.GUPTA, MEMBER(JUDICIAL) HON'BLE SH. ANIL SRIVASTAVA, MEMBER 1. Whether reporters of local newspaper be allowed to see the judgment? Yes 2. To be referred to the reporter or not? Yes Present: Shri Pawan Kumar Vashist, Counsel for the appellant. Shri Ayush Malhotra, Counsel for the respondents. PER : SHRI ANIL SRIVASTAVA, MEMBER JUDGEMENT
Assailing the orders dated 25.11.2009 passed by the District Consumer Disputes Redressal Forum, New Delhi in CC No.761/2009 in the matter of Shri Romesh Suri vs. Oriental Insurance Company Ltd., allowing the complaint and directing the insurance company to pay a sum of Rs. 1,27,336.76 to Shri Romesh Suri as also Rs.50,000/- as compensation and Rs.10,000/- as litigation cost, the Oriental Insurance Company Ltd., for short appellant, has preferred an appeal under Section 15 of the Consumer Protection Act 1986 (the Act) against Shri Romesh Suri, hereinafter referred to as respondents, praying for the relief as under:-
1. Set aside the order dated 25.11.2009 passed by the District Fora and consequently the complaint be dismissed.
2. Passed such other order as the Hon'ble Commission deemed fit for the facts and circumstances of the case.
Facts of the case necessary for the disposal of the appeal are these.
The respondent no.1 had obtained a medi claim policy from the appellant for the period from 26.06.2004 to 25.04.2005 which policy was subsequently renewed for a further period of one year from 26.06.2005 to 25.06.2006.
On 12.06.2005 the respondent no.1 suffering from chest pain, was admitted to the Escort Heart Institute and Research Centre and had undergone on the recommendations of the doctors the coronary angiography on 13.06.2005. The respondent was discharged on the same day and soon thereafter a claim of Rs.27,336/- was preferred for reimbursement. The respondent was again admitted to the Escort Heart Institute and Research Centre on 01.07.2005 and again after the discharge a further claim of an amount of Rs.2,67,459/- was preferred for reimbursement. The two bills were however not passed. In the meanwhile owing to the ailment the respondents had to be admitted again in Max Devki Devi Heart and Vascular Institute on 10.01.2006 for treatment from where he was discharged on 11.01.2006. During the said period again the respondent had to undergo coronary angiography. In order to avail the cashless benefit the respondent had applied for remittance of a sum of Rs.29,162/- which request was not acceded to. The claim was repudiated by the insurance company on 07.02.2006, on the ground that the complainant/ respondent was suffering from a pre existing disease ad therefore his case falls in the category of exclusion clause 4.1.
The respondent was later admitted in Max Devki Devi Heart and Vascular Institute on 15.06.2006 for the coronary artery disease and in the process of treatment he had to undergo a coronary angiography on 17.06.2006, since diagnosed with double vessel disease with paten RCA stent. The treatment was done and the respondent was discharged from the hospital on 20.06.2006. Again a request was made for cashless benefit for paying directly to the hospital a sum of Rs.3,67,957/-. The said request was again not acceded to.
This complaint was accordingly filed before the District Fora praying for paying a total sum of Rs.6,91,909.89 in respect of the claim preferred alongwith such compensation towards mental agony and harassment as may be deemed fit. The complaint so filed was allowed granting the complainant reimbursement as also the compensation, which order has been impugned before this Commission.
Grounds of the appeal are that the impugned order is contrary to the material on record, apart from being vague, illegal, improper and baseless. Their further ground is that despite their averment before the Distt. Fora having remained un-rebutted the complaint was allowed. In fact their decision to repudiate the claim was in accordance with the terms of the policy with which both, insurer and the insured were bound and consequently the impugned order suffers from a grave infirmity. The parties to the insurance can not go beyond the terms of the agreement.
The respondents were noticed. They have filed a reply to the said appeal stating that the medi claim policy so obtained from 26.06.2004 to 25.06.2005 and again from 26.06.2005 to 25.06.2006 was on the terms and condition, clauses, warranties to the extent of Rs.1,00,000/- . Secondly the complainant was a known case of Ischemic Heart Disease over the last 25 years prior to the commencement of the policy which is the proximate cause of his claim and therefore the same is not covered under the Exclusion Clause 4.1 of the medi claim policy. The said clause reads as under:-
"4.0 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 connection with or in respect of:
4.1 Such disease which have been in existence at the time of proposing this insurance. Pre-existing conditions means any injury which existed prior to the effective date of this insurance. Pre-existing condition also means any sickness or its symptoms which existed prior to the effective date of this insurance, whether or not the insured person had knowledge that the symptoms were relating to the sickness. Complications arising from pre-existing disease will be considered part of that pre-existing condition".
Besides the relevant portion contained in the policy reads as under:-
Re-existing health condition or disease or ailment/ injuries:
Any ailment/ disease / injuries / health condition which are pre-existing (treated/ untreated, declared / not declared in the cover incepts for the first time are excluded upto 4 years of this policy being in force continuously.
It is a trite law that insurance is a contract based on certain terms and conditions as agreed to between the parties to the contract. Once the contract is done and the policy has been obtained, both the parties to the contract, insured and insurer, are under an obligation to adhere to the terms and conditions contained therein.
The matter was listed before us for arguments on 31.10.2017 when the ld. counsel from both sides appeared and advanced their arguments and made their submissions.
We have perused the records.
The ld. Counsel for the appellant in the first instance argued that the orders passed by the ld. District Fora suffers from infirmity since the agreement arrived at between them while obtaining the policy has not been examined and scrutinized in true spirit while passing the impugned order. They have stressed the point that the insurance is a contract and conditions contained in the policy is binding both on the insurer and the insured and that no deviation can be done by either side after the operation of the policy. The insurance company would be under the liability only in the event, a clause in the policy, have been violated which is not the case and thus the impugned orders suffer from a grave infirmity and thus liable to be set aside. The ld. Counsel relying on the judgement of the apex court, holding that concealment of pre existing decision is a ground for repudiation, prayed for the dismissal of the complaint. .
The ld. Counsel for the respondent in their submission on the other hand has stated that the filing of this appeal is a gross abuse of the process of law, mainly to deprive the legitimate claim of the respondent who has since passed away. He argued that the appeal is devoid of any basis.
On merit they have argued that the orders passed by the ld. District Fora rejecting the contention of the insurance company to the effect that the claim is not maintainable since the respondent was suffering from pre existing disease, is in order.
"The question of pre existing disease has been discussed at length by the Hon'ble State Commission holding as under:-
"Disease means a serious derangement of health or chronic deep seated disease frequently one that is ultimately total for which on insured must have been hospitalized or operated upon in the near proximity of obtaining the medi claim policy.
i. Such a disease should not only be existing at the time of taking the policy but also should have existed in the near proximity. If the insured had been hospitalized or operated upon for the said disease in the near past, say, six months or a year he is supposed to disclose the said fact to rule out the failure of his claim on the ground of concealment of information as to "pre-existing disease."
Ii Malaize of hypertension, diabetes, occasional pain, cold, headache, arthritis and the like in the body are normal wear and teat of modern day life which is full of tension at the place of work, in and out of the house and are controllable on day to day basis by standard medication and cannot be used as concealment of `pre-existing disease' for repudiation of the insurance claim unless an insured in the near proximity of taking of the policy is hospitalized or operated upon for the treatment of these disease or any other disease.
iii. If insured had been even otherwise living normal and healthy life and attending to his duties and daily chores like any other person and is not declared as a `diseased person' as referred above he cannot be held guilty for concealment of any disease, the medical terminology of which is even not known to an educated person unless he is hospitalized and operated upon for a particular disease in the near proximity of date of insurance policy say few days or months.
iv. Disease that can be easily detected by subjecting the insured to basic tests like blood tests like blood test, ECG etc. the insured is not supposed to disclose such disease because of otherwise leading a normal and healthy life and cannot be branded as `disease person'.
v. Insurance company cannot take advantage of its act of omission and commission as it is under obligation to ensured before issuing medi claim policy whether a person is fit to be insured or not. It appears that insurance companies do not discharge this obligation as half of the population is suffering from much malaises and they would be left with no or very little business.
Thus any attempt on the part of the insurer to repudiate the claim for such non-disclosure is not permissible, nor is `exclusion clause' invokable.
vi. Claim of any insured should not be and cannot be repudiated by taking a clue or remote reference to any so-called disease from the `discharge summary' of the insured by invoking the `exclusion clause' or non disclosure of `pre-existing disease' unless the insured had concealed his hospitalization or operation for the said disease undertaken in the reasonable near proximity as referred above.
vii. Day to day history of several years of some or the other physical problem one may face occasionally without having landed for hospitalization or operation for the disease cannot be used for repudiating the claim, For instance an insured had suffered from a particular disease for which he was hospitalized or operated upon 5, 10 to 20 years ago and since then had been living healthy and normal life cannot be accused of concealment of `pre-existing disease' while taking medi claim policy as after being cured of the disease, he does not suffer from any `disease' much less the pre-existing disease'.
viii. For instance, to say that insured has concealed the fact that he was having pain in the chest off and on for years but has never been diagnosed or operated upon for heart disease but suddenly lands up in the hospital for the said purpose and therefore is dis-entitled for claim bares dubious design of the insurer to defect the rightful claim of the insured on flimsy ground. Instances are not rate where people suffer a massive attack without having even been hospitalized or operated upon at any age say for 20 years or so.
ix. Non-disclosure of hospitalization/ or operation for disease that too in the reasonable proximity of the date of medi claim policy is the only ground on which `insured' claim can be repudiated and on no other ground.
The ld. Counsel for the respondent in support of his contention has also relied on the judgement of Hon'ble NCDRC in the matter of Praveen Damani vs. Oriental Insurance Co. Ltd., reported as IV (2006) CPJ 189(NC) holding that :-
if such an interpretation of the `exclusion clause' as were advanced, were to be upheld, the insurance company would not be liable to pay any claim whatsoever, inasmuch as every person suffers from symptoms of some disease or the other without the knowledge of the same. The Hon'ble Commission further observed that an insurance policy would not be a policy at all, as it would be a mere contract entered only for the purpose of accepting the premium without the bonafide intention of giving any benefit under the garb of pre existing disease".
It has further argued by them that it is a settled position of law that if contracting parties seek to achieve a certain purpose by entering into an agreement, the existence of exclusion clauses should be strictly interpreted, and if it tends to defeat the main purpose, the said exclusion clause should be read down by the court; and if that is not possible, the court should altogether ignore it. The ld. Counsel for this purpose has drawn our attention to the decision of the Hon'ble Apex Court in the matter of Skandia Insurance Co. Ltd. vs. Kohilaben Chandravadan and Ors. MANU/SC/0482/1987: (1987) 2 SCR 752 ; and B.V. Nagaraju vs. Oriental Insurance Co. Ltd. MANU/SC/0509/1996 upholding the view stated above.
The Hon'ble High Court of Delhi in the matter of Hari Om Agarwal vs. Oriental Insurance Co. Ltd. AIR 2008 Delhi 29, holding that the `main purpose' of the insurance policy catering to medical expenses incurred by the insured, is as under:-
If one proceeds on this premises, the concept of `pre-existing condition' has to be understood. Clause 4.1 defines it as nay injury which existed prior to the effective date of the insurance; and any sickness or its symptoms which existed prior to the effective date of the insurance, whether or not the insured had knowledge that the symptoms were relating to the sickness. It is apparent that even if there were known diseases or conditions, which were disclosed and for which there was a likelihood of complications arising in the future, the insurer sought to distance itself from the liability. There is no dispute here that diabetes was a condition at the time of submission of proposal; so was hyper tension. In a sense these were `old ailments'; the petitioner was advised to undergo ECG, which he did. The insurer accepted the proposal and issued the cover. One may ask, what then was the cover for. It is not an accident cover policy, or a life policy. Now, it is universally known that hypertension and diabetes can lead to a host of ailments, such as stroke, cardiac disease, renal failure, liver complications, etc, depending upon varied factors. That implies that there is probability of such ailments; equally they can arise in non-diabetics or those without hypertension. Unless the insurer spelt out with sufficient clarity, the purport of its clauses, or charged a higher premia, at the time of accepting the proposal, the insured would assume and perhaps, reasonably that later; unforeseen ailments would be covered. Thus, it would be apparent that giving a textual effect to Clause 4.1 would in most such cases render the medi claim cover meaningless; the policy would be reduced to a contract with no content, in the event of the happening of the contingency, therefore, I am of the opinion that Clause 4.1 cannot be allowed to override the insurer's primary liability; the `main purpose' rule would have to be pressed into service".
It is trite law that in disputes relating to insurance policies, if there is a possibility of two interpretations, then the one which favors the policy holder is to be accepted by the courts in Shashi Gupta (Smt.) vs. Life Insurance Corporation of India and Anr., reported in MANU/SC/0257/1995 and Life Insurance Corporation of India vs. Raj Kumar Rajgarhia MANU/SC/0133/1999 and the judgement of the Hon'ble High Court of Delhi in B.K. Chopra vs. Ombudsman Insurance (Delhi and Raj.) and Anr. MANU/DE/1424/2003, wherein it has been interalia held that an interpretation in favour of the policy holder must be favoured in view of the fact that the same advances the purpose for which a policy is taken and is in consonance with the object to be achieved for getting the policy holder insured against hospitalization. For all the reasons the ld. Counsel for the respondents argued for the dismissal of the appeal.
We have given our careful consideration to the law settled by the Hon'ble Apex Court as also by the Hon'ble NCDRC and we are of the considered view keeping in view the ratio of the judgements as also the insurance policy, that there exists no infirmity in the order passed by the ld. District Fora and we accordingly uphold it.
If the terms of the policy are to be accepted as argued by the Insurance Company probably the insurance company would always accept the premium but would never honour the claim since one can not evaluate or assess either about the pre existing disease or about the disease which may happen within 4 years of the obtaining of the policy. This is yet another ground for which we feel that the claim of the complainant / respondent appears to be just and proper. The terms of the policy to this effect only shows one sided effect which does not seem to be reasonable and sustainable, regardless of the fact that complainant / respondent had accepted the policy.
Ordered accordingly.
Copy of the order be sent to the parties free of cost as statutorily required. A copy of this order may be sent to District Forum for information.
File be consigned to records.
(ANIL SRIVASTAVA) (O.P.GUPTA) MEMBER MEMBER (JUDICIAL)