State Consumer Disputes Redressal Commission
Ranjan Garg vs Apollo Munish Lic on 24 October, 2017
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
CHANDIGARH.
Consumer Complaint No.367 of 2016
Date of institution : 25.11.2016
Reserved on : 09.10.2017
Date of decision : 24.10.2017
1. Ranjan Garg, aged about 48 years wife of late Shri Munish
Dhir son of Shri K.L. Dhir, resident of 54-FF, Pink Flats, Near
Y-Block, Opp. Petrol Pump, Rishi Nagar, Hambran Road,
Tehsil and District Ludhiana.
2. Anumlya Dhir aged about 14-1/4 years minor son of Shri
Munish Dhir through her mother and natural guardian Smt.
Ranjan Garg, resident of 54-FF, Pink Flats, Near -Block, Opp.
Petrol Pump, Rishi Nagar, Hambran Road, Tehsil and District
Ludhiana.
.......Complainants
Versus
1. Apollo Munich Health Insurance Co. Ltd., 2nd and 3rd Floor, I-
Labs Centre, Plot No.404-405, Udhyog Vihar, Phase-III,
Gurgaon-122 016, Haryana through its Head of Customer
Services (Grievance and Redressal Cell).
2. Apollo Munich Health Insurance Co. Ltd., Branch Office,
Feroze Gandhi Market, Ludhiana through its Branch Manager.
........Opposite Parties
Consumer Complaint under Section
17(1)(a)(i) of the Consumer Protection Act,
1986.
Consumer Complaint No.367 of 2016 2
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President
Mrs. Kiran Sibal, Member
Present:-
For the complainants : Shri Ramesh Sharma, Advocate. For the opposite parties : Shri Nitin Thatai, Advocate. JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT:
The complainants, Ranjan Garg widow of Munish Dhir and her minor son Anumlya Dhir, through his natural guardian, complainant No.1, have filed this complaint under Section 17(1)(a)(i) of the Consumer Protection Act, 1986, for issuance of following directions to the opposite parties:-
i) to pay ₹90,011/- i.e. ₹72,011/- (Optima Restore Policy) +
₹18,000/- (Optima Gold) as per Policy
No.110600/11121/6000004710/02;
ii) to pay ₹7,12,807/- i.e. ₹4,64,697/- (Optima Restore
Policy) + ₹1,19,251/- + ₹8,808/- + ₹38,040/- as per Policy No.110600/11121/6000004710/03;
iii) to pay ₹1,53,000/- as per policy of Optima Gold;
iv) to pay ₹4,97,324.74P spent on Chemos and other medical expenses;
v) to pay ₹4,64,264/- on account of medical expenditure incurred by the complainant (after the relapse of colon cancer) after the cancellation/termination of the policy by the opposite parties;
vi) to pay ₹3,00,000/-as compensation for suffering mental pain, agony and harassment; and
vii) to pay ₹50,000/-, as litigation expenses. Consumer Complaint No.367 of 2016 3
It is further prayed that the opposite parties be directed to continue the policies and its benefits to the complainants. Facts of the Complaint:
2. Brief facts, as stated in the complaint, are that Munish Dhir, husband of complainant No.1 and father of complainant No.2, since deceased, (hereinafter to be referred to as "DLA"), was holder of Apollo Munich Health Insurance Policy bearing No.11060/11030/500000246 known as Optima Cash Gold One Year, which was started from 22.3.2010 and thereafter he had been taking the said policy on year to year basis upto 6th policy, which was the last one and was valid from 31.3.2015 to 31.3.2016. The DLA in addition to the above policies was also having a Policy known as Optima Restore Floater bearing No.110600/11121/6000004710, which commenced from 1.2.2009 and thereafter he had been continuing this Insurance Policy on year to year basis and last such policy was taken by him for the period from 1.2.2015 to 31.1.2016.
Besides this, the DLA had also taken "Individual Personal Accident Standard" Policy bearing No.110600/21001/2000009134-03, which commenced from 1.2.2009 and was running continuously. The DLA had taken the insurance policies for himself as well as for the family members. The DLA was conscious about the importance of the insurance policies in the life of an individual and the family members. Unfortunately, the DLA died on 22.6.2016 having suffered from colon cancer (Carcinoma Colon) and for the said treatment lakhs of rupees had been spent by the DLA and the complainants by visiting various Hospitals like Kokilaben Dhirubhai Ambani Hospital & Medical Consumer Complaint No.367 of 2016 4 Research Institute, Mumbai and Dayanand Medical College and Hospital, Ludhiana. Ultimately the DLA expired and the claim was lodged as per the insurance policies, for a sum of ₹19,17,407/-, as detailed in the earlier part of this order at serial Nos.(i) to (v). The claim was rejected, vide letter dated 30.4.2015, Ex.C-2, by observing that the DLA was suffering from Asthma at the age of 5 years and the Optima Cash Policy was cancelled on account of non-disclosure of Asthma under Section 3(s) while taking the policy with the Insurance Company. The DLA for the first time was admitted in the Dayanand Medical College and Hospital, Ludhiana on 13.3.2015 at about 9.00 A.M. when the carcinoma was detected and he was discharged on 15.3.2015 for follow-up treatment but the claim was rejected. Payments were not made although there were medical policies for the purpose of treatment. Feeling aggrieved a legal notice was given to the opposite parties and thereafter the present complaint was filed for the issuance of the directions to the opposite parties reproduced above.
Defence of the Opposite Parties:
3. In pursuance of the notice, opposite parties appeared and filed their joint reply in which preliminary objections were taken to the effect that the husband of complainant No.1 had a medical history of Bronchial Asthma since the age of 5 years. This fact was deliberately concealed in the proposal form on the basis of which insurance policies were issued to the DLA. Therefore, the opposite parties rightly repudiated the insurance claim of the complainants as per Section VII j[see 5 (u): Non-disclosure & misrepresentation Consumer Complaint No.367 of 2016 5 as per old policy wordings] and rightly cancelled the policy due to non-disclosure and concealment of facts under Section 5(u) of the terms and conditions thereof. It was further averred that no relief can be granted to the complainants on the basis of the Insurance Contracts which were entered into on the basis of false Declaration and concealment of material fact. The DLA had obtained the policy by giving false Declaration in the Proposal Form when being asked specifically in Para No.6(a) "Have any of the insured ever suffered from/are currently suffering from any of the following: "(ii) Tuberculosis, Asthma, Bronchitis or any other lung/respiratory disorder, the DLA declared "No". The said insurance contract being in violation of the very fundamentals of laws of contract is not binding on the opposite parties to pay the insured amount as demanded by the complainants. A number of judgments have been cited to substantiate the same. The other averments have been denied.
However, it has been admitted that the DLA was taking the insurance policies since 2010. So far as the policies issued from various periods commencing with effect from March 2010 till 31st of March 2016 and from February 2009 to January 2016 are concerned, the same have been admitted. On merits, the other averments have been denied and a stand was taken that the DLA was suffering from Bronchial Asthma since the age of 5 years and had concealed the material facts. Denying any deficiency in service on the part of the opposite parties a prayer for dismissal of the complaint was made.
Consumer Complaint No.367 of 2016 6Evidence of the Parties:
4. In support of the averments made in the complaint, the complainants produced on record affidavits of complainant No.1 as Ex.C-A and Ex.C-B and the documents Ex.C-1 to Ex.C-7. On the other hand, the opposite parties tendered in evidence affidavit of their Assistant Manager (Operations) as Ex.OP/A and copy of authority letter dated 3.8.2017 as Ex.OP1/A. They also tendered documents Ex.OP-1 to Ex.OP-26.
5. We have carefully gone through the averments of the parties and the evidence produced by them in support of those averments.
We have also heard learned counsel for both the sides. Contentions of the Parties:
6. It was vehemently contended by the learned counsel for the complainants that the DLA was taking the policies continuously for the last many years. There was no problem with him but all of a sudden Carcinoma colon was detected and ultimately as a result of the same he expired. So far as the Asthma at the age of 5 years is concerned, the DLA was a minor at that point of time and he might not be knowing of the type of Asthma. Otherwise also it is common that a new born child may suffer from such type of disease due to the change of weather etc. There is no other evidence on record to connect that the DLA was a chronic Asthma patient except the reference in the clinical history. It was not a case that immediately before the death the DLA had taken the policies. Rather the DLA started taking policies at the age of 41 years i.e. in the year 2009-
2010 and not only for himself but for all the family members. In this Consumer Complaint No.367 of 2016 7 manner, it cannot be presumed that there was concealment of the facts on the part of the DLA but the Insurance Company has wrongly repudiated the insurance claim. Later during the subsistence of the Policies when he was admitted in the Dayanand Medical College & Hospital, Ludhiana on 13.3.2015 the policy was cancelled on 20.4.2015, Ex.C-3. It means that once the opposite parties had accepted policies for so many years and, as such, they could not terminate the same during the subsistence of the policies at the time when the patient/DLA was undergoing treatment. The opposite parties are bound to honour the policies for which they had been getting the premiums for the last so many years ranging from 8 to 9 years. The documents have been exhibited on record. Even if the documents are not exhibited, these are summary proceedings and the reference of the same has been made in the complaint and the affidavit. On this hyper-technical ground claim cannot be rejected. He relied upon the following two judgments:-
i) "United India Insurance Co. Ltd. v. Manubhai Dharamsinhbhai Gajera and Ors." AIR 2009 SUPREME COURT 446; and
ii) "Satish Chander Madan v. Bajaj Allianz General Insurance" CPJ 2016(1) 613 (NC).
7. On the other hand, it was vehemently contended by the learned counsel for the opposite parties that the DLA was having Asthma problem since the age of five years and he had kept concealed this material fact at the time of filling up the proposal form, on the basis of which the insurance policies in question were issued Consumer Complaint No.367 of 2016 8 in his favour and as a result of which the Policies have been rightly terminated by the opposite parties and the claim has been correctly repudiated on the said ground. The medical policy is a non-life insurance policy for which the Insurance Company is not bound to pay for the treatment of disease, which was concealed by the DLA initially when the Policy Proposal Form was filled. It was further contended that the DLA had given wrong answers in the proposal form, which were untrue specifically where the reference to various diseases has been made. It was further contended that the DLA was suffering from hypertension and DM, which is clear from the medical record. The cause of death has clear nexus with the disease, which the DLA had concealed. Learned counsel for the opposite parties relied upon the following judgments:-
i) "Satwant Kaur Sandhu v. New India Assurance Company Ltd." 2013(3) CPR 664 (SC);
ii) "Life Insurance Corporation of India and another v.
Maya Devi" 2016(2) C.P.J. 396 (NC);
iii) "LIC of India and another v. Kusum Ashok Sharma"
Revision Petition No.71 of 2011 decided on 7.1.2015 (NC);
iv) "LIC of India & Ors. v. Ramamani Patra & Anr."
2015(4) C.P.J. 529 (NC);
v) "Life Insurance Corporation of India & Ors. v. Nita Bhardwaj" 2014(1) CPJ 409 (NC);
Consumer Complaint No.367 of 2016 9
vi) "Life Insurance Corporation of India through the Sr. Divisional Manager v. Veena and others" 2014(2) C.P.R. 127;
vii) "Sunita Rani and others v. Life Insurance Corporation of India" 2010(4) CPJ 337; and
i) "SBI Life Insurance Company Limited v. Nirmal Singh" 2016(4) CLT 497.
Consideration of Contentions:
8. We have given our thoughtful consideration to the contentions raised by the learned counsel for both the sides.
9. Admittedly the DLA had been taking the medi-claim policies and other policies since the year 2009-2010 and continued thereafter till his death. The DLA had not taken only one policy but he had taken many policies for himself and the family members. There was no concealment on the part of the DLA with respect to the disease specifically of Asthma at the age of 5 years. The problem of Asthma otherwise occurs; being immunity level of a child very low at that particular age and such type of disease i.e. breathing problems occur. Except the reference in the medical history of the DLA that he had been suffering from Asthma since the age of 5 years, there is nothing on record that from when he was knowing about the same. There is no documentary evidence on record that such disease continued throughout his life till death and that he was a patient of chronic asthma. Reference of this disease in the medical history of the DLA cannot be taken as authentic evidence that this disease continued for years together. Otherwise also the cause of death is Consumer Complaint No.367 of 2016 10 the Carcinoma of Colon, which has no nexus with regard to the ground on which the claim has been repudiated. The authorities cited by the learned counsel for the opposite parties are not applicable in the facts and circumstances of the case.
10. It is otherwise the duty of the Insurance Company to verify the health status of an individual specifically when the Policy is continuing for the last many years i.e. ranging from 6 to 8 years and it was not a case that the policies were immediately taken. This is a common practice of the Insurance Companies to repudiate the claim on flimsy grounds without any justification.
11. It is also relevant to mention here that Section 19 of the General Insurance Business Nationalization Act, 1972 states that it shall be the duty of every Insurance Company to carry on general insurance business so as to develop it to the best advantage of the community. The denial of medical expenses reimbursement is utterly arbitrary on the ground that disease in question was excluded as per exclusion clause. It is mere an excuse to escape liability and is not bona fide intention of the insurance company. Fairness and non- arbitrariness are considered as two immutable pillars supporting the equity principle, an unshakable threshold of State and public behavior. The terms and conditions of any policy in the realm of insurance company should be informed, fairly and non-arbitrarily. When the insurance policy has exclusions/conditions to repudiate the claim or limit the liability, the same must be specifically brought to the notice of the insured and are required to be got signed to show Consumer Complaint No.367 of 2016 11 that such exclusions and conditions have been brought to his/her notice.
12. The need for interpreting a contract always arises in two situations, (i) when a gap is needed to be filled in the contract and (ii) an ambiguity is needed to be resolved in the contract, then to find out correct intention of the contract, spirit behind it is required to be considered. Normally, the insurance policy is a contract of adhesion, in which other party is left with hardly any bargaining power as compared to the insurer. Insurance contracts are standard form contracts and are drafted by the insurance company and as such, insurance company is at higher footing than the insured. The benefit of such clause, as exclusion clause, would go to the insured, unless the same is explained in clear terms by the insurer. In such circumstances, the tribunal would be more oriented towards the interpretation, which goes against the party, who has inserted/drafted the disputed clause in the agreement/contract. The adjudicating authority is required to look into, whether the intention of the party is to exclude or limit liability has been appropriately explained to the other party or not. This Commission while interpreting insurance agreement is to honour the intention of the parties, who have signed the agreement. Even if the agreement had general exclusion/condition for misrepresentation still fraudulent misrepresentation and non-disclosure may not be there. The innocent and negligent misrepresentations are to be ignored.
13. Hon'ble Supreme Court in Manubhai Dharamsinhbhai Gajera's case (supra) has held in para no.64 as under:-
Consumer Complaint No.367 of 2016 12
"64. Each of the aforementioned cases clearly shows that the action on the part of the authorities of the appellant was highly arbitrary.
Respondents though were not entitled to automatic renewal, but indisputably, they were entitled to be treated fairly. We have noticed hereinbefore some of the clauses contained in the prospectus as also the insurance policy. When a policy is cancelled, the conditions precedents therefor must be fulfilled. Some reasons therefor must be assigned. When an exclusion clause is resorted to, the terms thereof must be given effect to. What was necessary is a preexisting disease when the cover was inspected for the first time. Only because the insured had started suffering from a disease, the same would not mean that the said disease shall be excluded. If the insured had made some claim in each year, the insurance company should not refuse to renew insurance policies only for that reason. The words 'incepts for the first time' as contained in clause 4.1 as also the words 'continuous and without break' if the renewal premium is paid in time, must be kept in mind as also the reasons for cancellation as contained in clause 7(1)(n) thereof."Consumer Complaint No.367 of 2016 13
In the case in hand, no valid reasons have been assigned for cancelling the insurance policies when it came to the knowledge of the opposite parties that the DLA was admitted in the Hospital and was undergoing treatment and after the death of the DLA, rejected the claim so filed by the complainants.
14. In view of our above discussion, this complaint is allowed and the opposite parties are directed as under:-
i) to pay the entire amount as per the insurance policies in question along with interest at the rate of 9% per annum from the date of filing of the complaint till the date of realization; and
ii) to pay ₹22,000/-, as litigation expenses.
15. The compliance of this order shall be made by the opposite party within two month from the date of receipt of the certified copy of this order.
16. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (MRS. KIRAN SIBAL) MEMBER October 24, 2017 Bansal Consumer Complaint No.367 of 2016 14