Sri Partha Kumar Basu, Ld.Member

The complaint petition is filed u/s 35 of the Consumer Protection Act’ 2019 at the instance of the complainant against the OPs for alleged deficiency in service in a consumer dispute about refusal of Insurance coverage by the OP Insurer Company.

The OP insurance company contested the complaint case by filling Written Version. Both the sides exchanged questionnaires, replies and BNAs The Ld. Lawyer of both sides were present on 26.09.2024 and advanced their respective arguments which were heard in full at length. Today is fixed for delivery of Judgement / passing final order.

The case of the complainant as adduced by evidence is that he alongwith his spouse and daughter had taken health insurance policy from the OP insurer company under family scheme vide policy no.P/191133/01/2022/005793 for the period from 06.10.2021 to 05.10.2022 when the insurer sought documents regarding cerebral diseases (brain stroke) of the complainant. The complainant replied to it vide letter dated 28.03.2022 by denying having any such history of ailment beyond reasonable limits. Further, the complainant-cum-insured received communication from the insurer OP company having his name been deleted from the coverage of the said health insurance policy with effect from 02.04.2022 due to non-disclosure of pre existing disease. The complainant further claims that no refund of premium has been given to him by the insurer in this respect either.

The complainant therefore prayed before this Commission for an order directing upon the OPs for refund of the insurance premium of Rs.21,086/- along with compensation of Rs.50,000/- for mental agony and harassment and litigation cost.

In support the complaint, the complainant exhibited the copy of policy dated 06.10.2021alongwith covering letter dated 06.10.2021 (7 pages), complainant’s letter no. nil dated 31.01.2022 replying to queries of OP insurance company about past history of illness, email extract from complainant dated 21.02.2022, insurance premium receipt dated 06.10.2021, policy document dated 06.10.2021 denoting list of ailments of insured cum complainant, endorsement schedule of insurer dated 02.04.2022 stating deletion of insured /complainant’s name and reply dated 28.03.2022 from the insured to the insurance company alongwith postal receipt.

The OPs contended that in the proposal form, the complainant declared having no ailment at the time of purchasing the policy effective from 06.10.2021 but was subsequently discontinued from the coverage of the insurance policy for having  pre-existing diseases. The OP no.1 further contended that during routine tele-verification call during January, 2021 the complainant / insured declared having only diabetes and blood pressure for which he was under medication. The OPs state that the insured disclosed having suffered from an injury on the right hand followed by implantation of plates by surgery. The complainant further sent clarifications by letter dated 31.01.2022 mentioning medical records in support of his ailment as type-II diabetes mellitus (T2DM) prior to commencement of the first policy as per one discharge certificate dated 06.05.2021(Def Exh-P-3) from a hospital. The OPs argued that since the complainant-cum-insured intentionally suppressed material facts about PED at the time of taking health insurance policy from the OP1 in the proposal form dated 06.10.2021 (Def Exh-P-2) hence the OP1 insurance company had no other alternative but to remove him from the coverage of the said policy by passing an endorsement with effect from 02.04.2022. The OPs contended that being diagnosed with T2DM diabetes as per hospital discharge certificate dated 06.05.2021, tele-verification records and complainant’s letter dated 31.01.2022 having suffered from injury on the right hand along with plate implant, none of those material facts were disclosed by the insurer-cum-complainant while taking the said policy from OP-1 as evident from the proposal form. The OP further submits that as per pre-condition of the insurer’s policy u/s 19(2) of the Protection of Policy Holder, 2017 there is a requirement of disclosure of material information regarding a proposal or a policy. It is claimed that the complainant / insurer never mentioned about such medical conditions which are an act of non-disclosure of material fact and the contract of insurance therefore became void. The OP insurer also cited standard condition no.4 (1) of the policy that if the policy gets void then all premium paid shall be forfeited in the event of mis-representation or mis-description or non-disclosure of material fact by the policy holder. The OPs relied upon the Judgment of the Hon’ble Apex Court in the case of Satwant Kaur Sandhu Vs New India Insurance Company in 316 of 8 SCC (2009) and also by order dated 01.04.2019 in 3359 of 2019 in the matter of Oriental Insurance Company Vs Mahindra Construct wherein the Hon’ble Apex Court dismissed the case and pronounced Judgment in favour of the insurance company by recognising the basic principal of utmost good faith and mis-representation clause. The OPs claimed that the complainant herein suppressed material facts regarding his pre-existing ailments while obtaining the policy, thus breaching the principle of uberrimae fidei inherent in insurance contracts. The OPs argue that the deletion was therefore justified as per the policy terms and conditions regarding Disclosure of Information norm. The counsel of OP asserted about the significance of the non-disclosure and the contractual implications thereof. They argue that, had the complainant provided accurate information about his pre-existing conditions, the policy would not have been issued or would have been issued under different terms. The terms of this insurance is a contract which must be strictly adhered to, and any claims made by the insured must fall within the coverage explicitly outlined in the policy.

From the Defence exhibits, it appears that P-1, P-2 and P-5 relates to the insurance documents and policy conditions of the complainant / insured. The other 2 no. of exhibits i.e. P-3 and P-4 relates to the spouse of the complainant.

Gone through all the records and documents. Examined rival contentions.

The crux of the dispute amongst contesting parties is that the ongoing family health insurance coverage was foreclosed / terminated in respect of the complainant himself due to alleged concealment of pre-existing diseases like type 2 Diabetes Mellitus, Hypertension and Implant of plates inside hand. It appears that there is no dispute between the contesting parties about the factual part of the complaint case and their records. All the issues are taken up together for the sake of brevity and to avoid repetition.

Firstly, as per policy letter issued by the insurer to the insured / complainant on 06.10.2021, there was a free-look period of 15 days to review the terms and conditions of the policy and to seek cancellation, if any, for refund of premium. But the complainant cum Insured did not opt for the same. Hence the insurance contract is deemed to have been accepted by the insured and the claim of the insured/complainant for refund of insurance premium at a later stage is not tenable on this ground alone.

Secondly, the Final Order of the Hon’ble NCDRC dated 10.04.2024 in the matter of Revision Petition in Care Health Insurance Ltd. Vs Harjinder Singh Sohal as cited by the Complainant in the instant case in hand is not coming much in support of the complainant as much as the said RP is on the different set of facts and footings as the dispute therein was regarding repudiation of health insurance claim wherein the complainant claimed to have been concealed information regarding pre-existing diseases in the proposal form and it was found that indicating proper disclosure of such conditions when the allegations got unfounded. Moreover, in that RP, the policy was issued despite incomplete columns in the proposal form which indicated the OP's awareness of the complainant's medical history, precluding them from denying the claim on those grounds, which is not a case herein.

Thirdly, from the letter dated 31.01.2022 and 28.03.2022 issued by the insured / complainant to the insurer / OP-1 insurance company,it is evident that against their query, the complainant have had intimated about surgical implantation on his right hand and also claimed having no issues regarding blood pressure and sugar which were stated within allowable limits in support of which the discharge summary of the hospital is on record. But from the exhibit no.P-2, it is evident that in the proposal form of the policy and against the questions whether the insured had health problems or not, the complainant declared it as ‘none’. In another place under the medical declaration against a query that whether the insured suffered / suffering from any disease / ailment / adverse medical condition of any kind specially heart / stroke / cerebral renal disorder / alzheimer / parkinson’s disease, the insured replied as “no”.  From the defence exhibit no.P-3 which is a discharge certificate from the hospital dated 06.05.2021, it appears that the complainant had been suffering from diabetes (T2DM). A fewJudgments are cited by the OP insurance company to garner support in favour of their arguments, upon thorough examination of which it appears that all such Judgments relates to non-disclosure of PED on the grounds of stage IV cancer of Metastasis and Carcinoma that are progressive and could not have happened without prior knowledge of the insured. The other Judgment of Hon’ble Apex Courts are regarding Diabetes as well as Chronic renal failure (CKD). But none of these cited Judgments by OP Insurance company are applicable in the instant case since the ailments in this case are type 2 Diabetes and Blood pressure i.e. hypertension. In the instant case in hand, it appears that these ailments are all lifestyle diseases and well within the control upon treatment through medications. There are a catena of Judgments wherein it was viewed that the malaise of hypertension, diabetes, arthritis etc. are controllable on standard medication and can not be used as a ground of concealment of PED for repudiation of insurance claims in near proximity of taking of the policy if insured had been even otherwise living normal and healthy life.

Further, it is evident from the exhibits that it is the claim of the OP Insurer that the complainant had a surgery in his right hand out of a 2 wheeler accident followed by an implant which is never disagreed by the complainant. But such history of factum of surgery which is the admitted position of the complainant was never disclosed by him in the proposal form dated 06.10.2021 that was subscribed by the complainant on online basis through One Time Password.

Therefore the contention of the OP Insurance company about the wrongful declaration of PED in respect of the complainant, becomes partly tenable.

The facts and circumstances and materials on record, more particularly, relying upon the evidence on record, it is palpably clear that there is a contributory negligence caused by both the parties. On one hand, while the Insured complainant failed to properly disclose all the ailments of himself in proposal from, on the other hand the OP Insurer, foreclosed the insurance coverage on the ground of having Diabetes and Hypertension as Pre-Existing Disease (in addition to surgical implant on the hand) without further medical examination about the veracity of such lifestyle diseases that are controllable with medications and without ascertaining whether the insured is living normal and healthy life.

In view of the above, the complainant is not entitled to get any relief. However it will be incumbent on the part of the OPs to refund the proportionate amount of insurance premium as advanced by the complainant.

As there is a contributory negligence by both the contesting parties, there shall be no order on compensation. The parties shall bear respective costs.

The instant complaint case is decreed on contest in part but without cost.

Hence, it is :-

                                                                                       ORDERED

That the OPs, jointly and/or severally, are directed to refund the proportionate amount of insurance premium in respect of the complainant Sri Aninda Chakraborty only, or 1/3 rd. of the annual insurance premium of Rs.21,086/-, whichever higher, in respect of the policy no. P/191133/01/2022/005793.

However, the complainant will be at liberty to put the entire order into execution after the expiry of 6 weeks, in case this order is not complied with by the OP within 60 days from the date of passing of this order.

Let a copy of this order be supplied to both the parties as per C P Act.

The Registry is directed to arrange uploading the copy of this order in www.confonet.nic.in. 

Dictated and corrected by me.

      Partha Kumar Basu

              Member