State Consumer Disputes Redressal Commission
Oriental Insurance Co. Ltd. vs Yogesh Kapoor on 14 December, 2006
A-233/99 IN THE STATE COMMISSION: DELHI (Constituted under Section 9 of The Consumer Protection Act, 1986) Date of Decision: 14-12-2006 Appeal No. 233/1999 (Arising out of Order dated 28-10-1998 passed by the District Consumer Forum (North), Delhi, in Complaint Case No.418 of 1995) The Oriental Insurance Company Ltd. 1576-R, 1st Floor, Kashmere Gate, Delhi 110006. . . . Appellant Also Regional Office at:- 86-88 Janpath, New Delhi. Versus 1. Mr. Yogesh Kapoor, 4420-Cloth Market, Fateh Puri, Delhi. 2. Mr. Anurag Kapoor (Minor), Through his father and natural guardian Mr. Yogesh Kapoor. . . . Respondent CORAM: Justice J.D. Kapoor, President Mahesh Chandra, Member
1. Whether Reporters of local newspapers be allowed to see the judgment?
2. To be referred to the Reporter or not?
Justice J.D. Kapoor (Oral)
1. The insurance claim of the respondent against medicalim insurance policy was repudiated by the appellant on the ground of concealment of pre-existing diseases by the respondent at the time of taking the policy. Feeling aggrieved the respondent filed the instant complaint before the District Forum.
2. Vide impugned order dated 28-10-1998 the District Forum allowed the complaint and directed the appellant to pay Rs. 14,648/- with 6% interest and Rs. 1000/- as cost of litigation. Feeling aggrieved the appellant has preferred the present appeal.
3. Relevant facts of the complaint, in brief, are that the respondent took a mediclaim policy from the appellant Insurance Company for the period 08-07-1993 to 07-07-1994 and again from 08-07-1994 to 07-07-1995. On 15-07-1994 the son of the respondent suffered some ailment and became senseless while in the school and was removed to Ganga Ram Hospital and admitted there. During treatment in the said hospital he underwent various tests and treatment for which an expenses of Rs. 14,648/- was incurred. A claim was lodged with the appellant for the said amount but the appellant vide its letter dated 31-08-1994 rejected the claim on the ground that the disease was pre-existing.
4. The solitary reason provided by the appellant in rejecting the claim was that as per the hospital record, it is mentioned in the summary of case that the son of the respondent had suffered similar episode once about two years back and as such the claim of the respondent did not fall within the ambit of insurance policy since the disease for which the respondent had filed the claim was pre-existing disease and therefore covered by exclusion clause of the policy.
5. The previous record of the attacks suffered by the son of the respondent in December, 1999 showed that he had minor epileptic attack and thereafter he became alright. X-ray report also showed no abnormality. He did not have any problem or ailment in the intervening period.
6. The main contention of the counsel for the appellant is that the incident of having an epileptic attack two years before was not disclosed in clause 13(a) of the proposal form.
7. Apart from this, the counsel for the appellant has also relied on the opinion of the medical expert who has clearly stated in his report which is to the following effect:-
Patient was admitted with complaints of episode of generalized tonic clonic seizure which was associated with clinching of teeth and fist and deviation of mouth which lasted for few minutes. Patient had a similar attach two years back. He was investigated. Hb, TLC, DLC, ESR, EEG, Elisa, CSF, CT Scan Head, MRI etc. were done. He was diagnosed as a case of complex partial seizures with inflammatory granuloma left parieto-occipital region. He was treated with Tegretol.
In this case, in discharge summary, it is clearly mentioned that the patient had similar attach two years ago. This indicates that disease is pre-existing. Considering this the claim is not admissible.
The claim of Mr. Yogesh Kapoor is not payable subject to terms and conditions of the policy.
8. The discharge summary of the hospital shows no ingredients of the diseases mentioned in Column 13. We have taken a view that unless and until the person suffers from such diseases for which he is hospitalized or undergone treatment in the near proximity of obtaining the policy and if at all any person who was hospitalized much prior to the taking of the policy and in the intervening period does not suffer from any ailment, he is not supposed to disclose the disease which is not existing at the time of taking the policy.
9. In our view, the consumer is not entitled to any claim if he conceals the factum of his hospitalization for a particular disease or having undergone operation for such disease in the near proximity of the date of proposal of insurance. It is only in respect of non-disclosure of such an event that he or she can be accused of having breached a faith while furnishing information in the proposal form. Further diseases which are common malaise of the modern life and are controllable on day to day basis and need only medication and neither hospitalization nor operation are not such diseases which should be disclosed in the proposal form for insurance claim as the consumer attends to normal and daily chores like any other healthy person nor such diseases fall within the nomenclature of pre-existing disease. We have come across cases where the claims of the consumers were denied for not having disclosed the minor physical problem being faced for 20 long years without affecting normal day to day life without even undergoing any operation or hospitalization.
10. The diseases which are being used by the Insurance Companies for repudiation of the claim are such which can be easily detected on examining the consumer at first instance or subjecting the consumer to some basic tests of blood sugar, ECG etc. For their own act of omission and commission, the Insurance Companies are taking undue advantage. For their negligence in performing their obligations they cannot be allowed to take undue advantage to the detriment of the interests of the consumer. Such an approach creates doubt as to their intention.
11. Experience shows that Insurance companies lay trap for the poor and gullible consumers to sell their product and once they are in their net they start wriggling out from their obligation. This is not the way to become rich by taking huge premium against mediclaim policies of thousands of consumers and when one or two of them files a claim they start taking one excuse or the other and find out the ways to defeat the rightful claim of the insured by picking a stray reference from the discharge summary. This is not a consumer friendly practice and does not augur well even for the interest of the Insurance Companies. Half of the population suffers from such malaises and the other half is on medication in one form or the other. If Insurance Companies start denying policies on medical tests of the consumers they will be out of business sooner or later.
12. If the consumers at large get such an impression of the Insurance Company, the Insurance Company will loose its customer in these competitive times. It appears that because of such an approach of monolithic public sector Insurance Companies that this sector was opened to private and international players.
13. In the instant case the son of the respondent had never been hospitalized nor operated upon for so called pre-existing disease. He was admitted to hospital for the first time subsequent to the medi-claim policy. Had there been any malafide attempt on the part of the respondent to conceal the factum of pre-existing disease it would have been projected in the discharge summary wherein the respondent gave actual facts to the treating doctor. Can such a person be accused of concealing the fact that he or she was suffering from a particular disease, the medical terminology of which even educated person does not know. Certainly not. Nor can such a disease or complaint as referred in the Discharge Summary be used as a pre-existing disease for invoking exclusion clause.
14. Let us deal as to the import, concept and scope of exclusion clause or plea of concealment of a fact by the consumer as to a pre-existing disease. To get teeth more deeply into reality we have to first know as to what is the meaning of word disease. Dictionary meaning of disease is illness, a serious derangement of health or malady, a bodily disorder. Ordinarily disease or malady refers to a deep-seated chronic disease, frequently one that is ultimately fatal whereas any other ailment or even chronic disorder like diabetes, hypertension, pain in limbs or body or even arthritis that are controllable by day-today medication are generally present in the people in their middle age say above forty or fifty.
This is internationally accepted dogma of health as ordinarily even medical insurance of people below forty does not require any blood test or test for hypertension or ECG or any other test for heart ailment.
15. As is apparent, any malady, which is controllable with medication and does not involve such a treatment that needs hospitalization for days together or needs operation to cure it is not a disease for the purpose of mediclaim policy. If medication of any such malaise can keep the men fit for doing daily chores and ordeals such a malaise can by no stretch of imagination be termed as a disease much less the pre-existing disease.
16. Thus malaises of diabetes, hypertension, occasional pain in the body or organs, fever at times, ischemia, anginal pain or as in the instant case, epilepsy which is controllable with medicines, are not such diseases non-disclosure of which may be used for repudiating the claim against mediclaim policy. These are normal wear and tear of human life.
Unless a person is hospitalized for the treatment or operated upon, he cannot be held to be suffering from a pre-existing disease as he undertakes day to day activities and attends to daily chores and duties.
17. Why does a person obtain mediclaim policy?
He obtains it to meet the medical expenses incurred by him for hospitalization or operation for specific disease. Fact that insured cannot be reimbursed the daily expenses incurred by him for medicines being taken by him regularly or on day-to-day basis shows that claim against such a policy is permissible only if an insured is hospitalized or operated upon for curing the specific disease. Thus non-disclosure of above-referred maladies is insignificant. These are not such diseases that fall within the exclusion clause for the purpose of mediclaim policy.
18. It is common knowledge that half of the population suffers from these maladies. Other half does not have a perfect health to the mathematical precision. Had it been so lacs of people wont be thronging to the Yoga Camps or such like congregations for being taught about healthful hints.
19. It is in the interest of these companies not to repudiate the claims on flimsy grounds particularly invoking exclusion clauses or concealment of such diseases as in that case they would be left with no business. They wont be left with any customer who shall be eligible to obtain these policies as every one of them if subjected to a medical examination would be found having one problem or the other.
Let these Insurance Companies make a medical tests a condition precedent for issuing mediclaim policy and not rely upon the information provided by the consumer and see how many customers they get.
Out of 10, nine would be suffering from such maladies.
20. Now we advert to the meaning of word pre-existing. As the word pre-existing suggests, a disease should not only be existing at the time of taking of policy but also should have been existing and continuing to exist prior to the date of policy. We have come across many cases where the claims of insured were repudiated on the ground that the insured had not disclosed that he was operated or hospitalized for a particular disease ten to fifteen or five years ago. Can non-disclosure of such a fact be treated as concealment of pre-existing disease?
Certainly not. Why? Because the person was cured of the said disease and had been leading a normal life for ten years and to tell him after six months of taking the policy that he did not disclose that he was operated upon or he was hospitalized for a disease that existed 10 years before and therefore it was a concealment of fact about pre-existing disease. Such an approach or interpretation is nothing short of logic-chopping as for 10 years and particularly at the time of taking the policy or in its near proximity, the disease did not exist.
21. Non-disclosure of a factum of having been hospitalized or operated upon for the treatment or cure of a specific disease in the near proximity say six months or a year prior to taking the policy may be used for repudiating the claim for the reason of non-disclosure of pre-existing disease as in that event, element of malafide of the insured cannot be ruled out.
22. It is astonishing that in most of the cases the panel doctors of the Insurance Companies pick up a stray reference in the discharge summary of the insured giving the past history and use it as a guise to repudiate the rightful claim of the insured. For instance, if patient or his relative, at the time of admission, gave the history of a particular problem that he or she was having for the past few years, these companies use it as non-disclosure of pre-existing disease and also invoke exclusion clause inspite of the fact that the insured has been otherwise leading a normal healthy life and attending to his duties, daily chores and had never been hospitalized or operated upon for the said problem or malady.
23. Such a propensity and tendency on the part of the Insurance Companies needs to be curbed with heavy hand as invariably every mediclaim is being repudiated on these excuses. On the one hand they do not subject the insured to basic tests to rule out these maladies as they want to augment their business by charging the premium while on the other hand when out of ten one or two consumers file a claim, they start finding out one excuse or the other, most of which are dubious and feeble to defeat the rightful claim of the party. This is highly unethical and uncouth practice.
24. To sum up our conclusions are as under:-
(i) Disease means a serious derangement of health or chronic deep-seated disease frequently one that is ultimately fatal for which an insured must have been hospitalized or operated upon in the near proximity of obtaining the mediclaim policy.
(ii) 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.
(iii) Malaise of hypertension, diabetes, occasional pain, cold, headache, arthritis and the like in the body are normal wear and tear 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 diseases or any other disease.
(iv) 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.
(v) Disease that can be easily detected by subjecting the insured to basic 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 diseased person.
(vi) Insurance Company cannot take advantage of its act of omission and commission as it is under obligation to ensure before issuing medi-claim policy whether a person is fit to be insured or not. It appears that insurance Companies dont discharge this obligation as half of the population is suffering from such 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.
(vii) 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.
(viii) Day to day history or 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 hospitalised 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 mediclaim policy as after being cured of the disease, he does not suffer from any disease much less the pre-existing disease.
(ix) 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 disentitled for claim bares dubious design of the insurer to defeat the rightful claim of the insured on flimsy ground. Instances are not rare where people suffer a massive attack without having even been hospitalised or operated upon at any age say for 20 years or so.
(x) Non-disclosure of hospitalization/or operation for disease that too in the reasonable proximity of the date of mediclaim policy is the only ground on which insured claim can be repudiated and on no other ground.
25. It is pertinent to mention that the mediclaim policies are on yearly basis and therefore if a patient does not suffer from any disease or not hospitalized for a period of atleast one year prior to the taking of the mediclaim policy. He is not supposed to disclose anything.
Moreover, the insurance companies always subject the consumer to medical tests before issuing a policy. If they do not do it, they do it at their own peril.
26. The other ground of repudiation in the instant case is violation or breach of good faith, that is, breach of provisions of Sec.45 of the Insurance Act, i.e. wilful concealment. The Ld. counsel for the appellant - insurance company contended that Sec. 45 empowers the insurance company to go into the details of all the aspects of the problem within two years.
27. In our view, Sec. 45 does not apply in this case as no such material was found by the appellant, firstly, because the panel doctors of the appellant found the son of the respondent at the time of proposal form in good and sound health. Secondly, the treating doctors did not come to the conclusion that the son of the respondent was suffering from the disease for long and, lastly, because the son of the respondent had never been hospitalised or operated upon for the disease much less in the near proximity of taking the policy.
28. Proceedings on the premise of the above discussion, we do not find any merit in the appeal. The appeal is dismissed with the stipulation that the interest shall be payable from the date of filing of the complaint and till the date of this order.
29. Interest is always awarded by way of compensation or mental agony, harassment and emotional suffering suffered by the consumer because the word compensation has wide connotation and takes in its fold each and every aspect of human suffering at the hands of service provider.
Wrongful repudiation of the claim is one such suffering. Compensation is awarded where there is no such term of contract between the parties.
The above view is supported by the judgment of the Supreme Court in Soventir India Limited V/s State Bank of India II 1996 SC 406 and latest judgment in Ghaziabad Development Authority V/s Balbir Singh, (2004) 7 CLD 861 (SC)
30. The appeal is disposed of in above terms.
Payment shall be made within one month of receipt of this order.
31. Copy of order, as per statutory requirement be forwarded to the parties free of cost and also to the concerned District Forum and thereafter the file be consigned to record. FDR/Bank Guarantee, if any, be released under proper receipt.
(Justice J.D. Kapoor) President (Mahesh Chandra) Member HK