Punjab

Ludhiana

CC/22/297

Neelam Rani - Complainant(s)

Versus

Star Health and Allied Ins.Co.Ltd. - Opp.Party(s)

Mohinder Kumar

12 Nov 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                             Consumer Complaint No:  297 dated 26.07.2022.                                       Date of decision: 12.11.2024. 

 

Neelam Rani W/o. Late Sikander Lal of H. No.2561, Sector 32A, Chandigarh Road, Ludhiana-141010. M-9814658040.                                                                                                                                               ..…Complainant

                                                Versus

Star Health and Allied Insurance Co. Ltd., 15, Sri Balaji Complex, Ist Floor, Whites Lane, Royapettah, Chennai-600014.                                                                                                                                       …..Opposite party 

Complaint Under Section 35 of Consumer Protection Act as amended up to date for illegal rejection of the genuine claim for the payment of medical bills by the opposite party name Star Health and Allied Insurance Co. Ltd.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

MS. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant             :         Mr. Shubham Kumar Malik, authorized                                                      representative of complainant in person.

For OP                           :         Sh. Rajeev Abhi, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                Shorn of unnecessary details, the facts of the case taken together from the complainant as well as affidavit Ex. CA of the complainant are that her husband Sikander Lal was availing insurance policy from New India Insurance Company since 2010 and he ported the policy to the OP Star Health and Allied Insurance Co. Ltd. in the year 2021. He used to take full body health checkup from SPS Hospital, Ludhiana. The complainant stated that abdominal problem was noticed and his treatment was started. However, on the basis of incomplete reports of SPS Hospital, the OP refused to grant cashless treatment. Thereafter, on 11.12.2021, Sikander Lal was taken to PGI Chandigarh for further treatment and doctors admit him and started his treatment. After checkup, Sikander Lal was found to be suffering from Heart Vassel Disease (Blockage in two heart vassels) and he was also having lungs problem causing breathlessness. Sikander Lal remained admitted at PGI Chandigarh for 18 days and unfortunately, he died. The claim preferred by the complainant was declined by the OP. Even the Insurance Ombudsman also dismissed the appeal of the complainant. According to the complainant, the cause of death of Sikander Lal was due to multiple organ failure. Further exclusion clause of the policy does not mean to reject the claim without proper investigation of other disease. Perusal of Heptology OPD of PGIMER Chandigarh shows that many ladies and child patient suffering such type of diseases who never use alcohol in their life time. Rejection of claim on the part of the OP amounts to harassment to the complainant. In the end, the complainant prayed for issuing direction to the OP to pay all the medical expenses incurred on treatment of her husband Sikander Lal along with compensation of Rs.20 Lakhs.

2.                Upon notice, the OP appeared and filed written statement and by taking preliminary objections, assailed the complaint on the grounds of maintainability; the complainant being estopped by her own act and conduct; the complainant being not approached with clean hands; concealment of material facts etc. The OPs stated that on the receipt of the claim, it was duly registered, entertained and processed. Complainant had obtained Family Health Optima Insurance Plan policy No.P/211236/01/2022/000030 valid from 08.04.2021 to 07.04.2022 covering Mr. Sikander Lal-self and Mrs. Neelam Rani -spouse, for the sum insured of Rs.5,00,000/-. This is a ported policy from The New India Assurance Co Ltd to the OP from 08.04.2021. Meaning thereby this is the first year of the policy with them. According to the OP, the insurance policy is issued on the principles uberrimae fides. Utmost good faith is a cardinal principle of insurance. This means that all the parties to an insurance contract must deal in good faith, making a full declaration of all material facts in the insurance proposal. Material facts are those that would influence underwriters as to whether he should or should not accept the risk. If a party fails to adhere to the principles of utmost good faith, the outcome of the claim may be affected. The insurance policy is issued on the basis of the proposal form. The insurance policy is a contractual in nature and the parties are bound by the terms and conditions of the policy.

                   The OP further stated that the claims arising therein are subject to terms and conditions forming part of the policy. The complainant has accepted the policy agreeing and being fully aware of such terms and conditions and executed the proposal form. The terms and conditions of the policy was served to the complainant along with the policy schedule. Moreover, it is clearly stated in the policy schedule "the insurance under this policy is subject to conditions, clauses, warranties, exclusions etc. attached." The insured was hospitalized on 01.12.2021 at Satguru Partap Singh Hospitals (A Unit of SJS Healthcare Limited)-Sherpur Chowk, G.T. Road for the treatment of LIVER CIRRHOSIS and discharged on 02.12.2021. Further the complainant raised a pre-authorization request to avail cashless facility and the same was denied stating that the insured patient has the above disease which is long standing and that it requires further evaluation, the same was communicated to the treating hospital as well as the insured vide copy of our letter dated 03.12.2021. Subsequently, the insured submitted medical documents in support of her claim during reimbursement of medical expenses, upon scrutiny of which following facts were observed:-

• As per the claim form Duly signed by the Resident Doctor of Hepatology Dept -PGIMR Chandigarh) the Current admission for Chronic Alcohal related cirrhosis, the cause for cirrhosis is ethanol related.

 

The OP further stated that as per the exclusion clause No.3 (12) of the policy that "The company shall not be liable to make any payment under this policy in respect of any expenses whatsoever incurred by the insured person in connection with or in respect of treatment of alcoholism, drug or substance, abuse or any addictive condition and consequences thereof. Code Excl 12".

                   As such, the claim was repudiated and communicated to the insured vide letters dated 04.03.2022 and 24.05.2022 respectively. The claim was preferred in the 1st year of the policy with the OP in respect to the medical management of Sikander Lal with Satguru Partap Singh Hospital, Ludhiana and PGI Hospital, Chandigarh from 01.12.2021 to 02.12.2021 and 11.12.2021 to 29.12.2021 with diagnosis Liver Cirrhosis for Rs.45,721/- mentioned in the claim form. Further as per RVO report: current admission for liver disease with cirrhosis, insured patient is a known alcoholic (as per statement of son, his) father is used to take alcohol occasionally), the current ailment is a complication of substance abuse of alcohol. As such, the claim of complainant was rightly repudiated as no claim on legal and valid grounds.

                   On merits, the OP reiterated the crux of averments made in factual submission. The OP has denied that there is any deficiency of service and has also prayed for dismissal of the complaint.

3.                In evidence, the complainant tendered her affidavit as Ex. CA and reiterated the averments of the complaint. The complainant also placed on record documents Ex. C1/A to Ex. C7/A as well as Ex. C4 to Ex. C11 and closed the evidence.

4.                On the other hand, the counsel for the OP tendered affidavit Ex RA of Sh. Sumit Kumar Sharma, Senior Manager of the OP along with documents Ex. R1 to Ex. R18 and closed the evidence.

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents as well as written statement, affidavit and documents produced on record by both parties.

6.                One Sikander Lal, husband of the complainant, had been successively subscribing to the mediclaim policies since 08.04.2011 with New India Insurance Company Limited till 07.04.2021. Thereafter, from 08.04.2021 onwards, he ported the health policy with the OP and obtained a Family Health Optima Insurance Plan Policy covering himself and his wife, the complainant for a sum of Rs.5,00,000/- having validity from 08.04.2021 to 07.04.2022 vide policy schedule Ex. C3A = Ex. R2. Perusal of the policy documents Ex. R2 depicts of factum of previous policy.

7.                Sikandar Lal got himself admitted in Satguru Partap Singh Hospital, Ludhiana on 01.12.2021 and was discharged on 02.12.2021. As per discharge summary Ex. R7, he was finally diagnosed to have suffered Cirrhosis Decompensated Child-12, Meld-29, PHTN with Ascites (Moderate), NO HE, Type-2 Diabetes Mellitus. During his stay at SPS Hospital, Sikandar Lal applied for approval of cashless treatment which was declined by the OP on 03.12.2021 vide letter Ex. C6 = Ex. R5 by observing that the hospital records shows a long standing ailment which may be prior to the porting of policy and the documents/details submitted by the hospital are not sufficient to ascertain the duration of the disease. However, the insured was asked to submit the reimbursement claim of the expenses incurred by him on the treatment.

8.                The complainant was admitted in PGI Hospital at Chandigarh on 11.12.2021 and remained under treatment for various ailments. Unfortunately, he died on 29.12.2021 and a Medical certificate of cause of death Ex. C2 was issued, where following observations are recorded:-

Cause of death		Interval between onset & death approx.
I. Immediate cause State the disease, injury of complication which caused death, not the mode of dying such as heart failure asthma etc. Antecedent cause Morbid conditions, if any, giving rise to the above cause, stating underlying condition last.   II. Other significant conditions contributing to the death but not related to the disease or conditions causing it.	(a) Refractory Septic Shock with Multi-Organ Dysfunction       (b) Acute chronic liver failure with hospital required Pneumonia with type-II Respiratory failure.   (c) Hepatic Encephalopathy Grade-II Acute Kidney Injury (State-II) Type-II Diabetes Mellitus Coronary Artery Disease (Double Vessel Disease)

 Manner of death

1. Nature  2. Accident 3. Suicide  4. Homicide 5. Pending Investigation.”

9.                The claim was preferred for reimbursement of the medical expenses incurred on the treatment of Sikander Lal insured and the claim was got investigated by the OP. The investigator, interacted with son and brother of the insured who disclosed that the patient used to take alcohol occasionally i.e. on functions once a week hardly. The investigator verified the medical records and observed that the doctors advised the insured for transplant of liver. However, he recommended the rejection of claim on the ground that it appears that pre-existing disease has been concealed and there is omission of material facts at the time of inception of the policy on 08.04.2021. The OP considered and scrutinized all the documents and repudiated the claim on 03.04.2022 vide repudiation letter Ex. R17. The operative part of Ex. R17 is reproduced as under:-

“We have processed the claim records relating to the above insured-patient seeking reimbursement of hospitalization expenses for treatment of LIVER CIRRHOSIS.

It is observed from the submitted records that the insured-patient has undergone treatment for the above disease which is due to use of alcohol.

As per Exclusion-Code Excl. 12 of the above policy, the Company is not liable to make any payment in respect of expense incurred at hospital for treatment for Alcoholism, drug or substance abuse or any addictive condition and consequences thereof.

We therefore regret to inform you that for the reasons stated above we are unable to settle your claim under the above policy and we hereby repudiate your claim.”

10.              Now the point of determination arises for consideration before this Commission whether the OP was justified in repudiating the mediclaim of insured Sikander Lal.

11.              While deciding the claim of the complainant, the OP has invoked the Code Excl. 12 exclusion clause 3(12) of the policy terms and conditions wherein it is recorded that "The company shall not be liable to make any payment under this policy in respect of any expenses whatsoever incurred by the insured person in connection with or in respect of treatment of alcoholism, drug or substance, abuse or any addictive condition and consequences thereof. In repudiation letter the word “use of alcohol” has been used while exclusion clause, when read as a whole, emphasizes for treatment of alcoholism. The word ‘Alcoholism’ is a medical condition and in common parlance it means that a person indiscriminately indulged in consumption of liquor at high scale in an addictive manner. The word ‘Use of Alcohol’ generally refers to small or moderate intake of alcohol in a non-addictive manner.  The investigator has formed his opinion on the basis of statement of son and brother of the insured and interpreted it wrongly. The statements of both these persons only refer the occasions intake by the insured and not to the fact  that the insured was in habit of drinking.

12.              The counsel for the OP has referred to Part-B of the claim form dated 20.01.2022 Ex. R12 wherein words “Ethanol + Methanol related:” against “Decompensated Cirrhosis” has been recorded. At another place “Chronic Alcoholic Related Cirrhosis” has been recorded in this Ex. R12. However, the aforesaid endorsements are conspicuously missing in Part-B of claim form dated 03.12.2021 Ex. R6. Part-B of claim form is generally filled by the treating doctors. Ex. R6 is said to have been filled by treating doctor of SPS Hospital whereas Ex. R12 has been filled by doctors of PGI, Chandigarh. Therefore, the material ambiguity has arisen with regard to use causation of liver cirrhosis. Even in the observations recorded in the Medical Cum Death Certificate Ex. C2 issued by PGI Hospital, Chandigarh does not support the reasons for repudiation. So the aforesaid facts persuade this Commission to arrive at the conclusion that the OP was not justified in repudiating the mediclaim of deceased Sikandar Lal regarding his hospitalization at Satguru Partap Singh Hospital, Ludhiana from 01.12.2021 to 02.12.2021 as well as PGI Hospital, Chandigarh from 11.12.2021 to 29.12.2021 and as such, the OP is directed to settle and reimburse claim lodged by the complainant in respect of treatment of her husband Sikander Lal at Satguru Partap Singh Hospital, Ludhiana from 01.12.2021 to 02.12.2021 and further his treatment at PGI Hospital, Chandigarh from 11.12.2021 to 29.12.2021 along with composite costs of Rs.10,000/-.

13.              As a result of above discussion, the complaint is partly allowed with direction to the OP to settle and reimburse claim lodged by the complainant in respect of treatment of her husband Sikander Lal at Satguru Partap Singh Hospital, Ludhiana from 01.12.2021 to 02.12.2021 and further his treatment at PGI Hospital, Chandigarh from 11.12.2021 to 29.12.2021 as per terms and conditions of the policy within period of 30 days from the date of receipt of copy of the order failing which the OP shall pay interest @8% per annum on the settled amount to the complainant from the date of order till its actual payment. The OP shall further pay a composite cost of Rs.10,000/- (Rupees Ten Thousand only) to the complainant. Payment of costs shall be made within a period of 30 days from the date of the receipt of the copy of this order. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.     

14.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Monika Bhagat)                              (Sanjeev Batra)               Member                                         President  

 

Announced in Open Commission.

Dated:12.11.2024.

Gobind Ram.