Oriental Insurance Company Ltd. vs K. ANANDAM

THIS appeal is by the Insurance Company challenging the order of the District Forum, Bangalore, allowing the complaint of the complainant.

THE facts in this case are that, the complainant had taken Mediclaim Policy from the O.P., for the period from 13.1.2001 to 12.1.2002. THEreafter, the said policy was renewed from 13.1.2002 to 12.1.2003. Before the expiry of the period, he also requested the O.P. to renew the policy, by paying the premium through cheque. As the cheque on presentation was dishonoured, the Insurance Company cancelled the renewal of the policy. THEreafter, the complainant was called upon to pay the premium by cash, and accordingly, he paid the premium by cash subjecting himself for a medical examination. THE result of the medical examination before issuing a fresh policy, disclose the ECG of the complainant is normal, as found in the proposal from. THEreafter, the Insurance Company issued a fresh policy with effect from 21.1.2003 to 20.1.2004. When this policy was in force on account of the sudden cardiac arrest, the complainant had to undergo a bypass surgery on 30.1.2003. For this bypass surgery, the complainant had spent a considerable sum. THEreafter, the complainant made a claim for rembursement before the Insurance Company. THE Insurance Company repudiated the claim on the ground that he is not entitled for reimbursement since it comes under the exclusion clause of the policy. This has made the complainant to file a complaint before the District Forum, for a direction to reimburse the expenditure incurred, for the treatment. THE District Forum no doubt, has held the policy issued with effect from 21.1.2003 to 20.1.2004 is a fresh policy. But, the District Forum allowed the complaint holding that, it is not appropriate for the Insurance Company to repudiated the claim on some technical ground. Learned Counsel, for the Insurance Company submits that, as per Clause 4.2 of the policy, the complainant is not entitled for reimbursement of the amount incurred for treatment. Clause 4.2 of the policy reads, as under: "4.2. Any disease other than those stated in Clause 4.3, contracted by the insured person during the first 30 days from the commencement date of the policy. This condition 4.2 shall not, however, apply in case of the insured person having been covered under this policy or group insurance policy with any of the Indian Insurance Companies for a continuous period of preceding 12 months without any break. Note: These exclusions clauses 4.1 and 4.2 shall not however apply if- (a) In the opinion of a medical practitioner(s) appointed by TPA/Company, the insured person could not have known of the existence of the disease or any symptoms or complaints thereof at the time of making the proposal for insurance to the company."

Reading of the above said clause, it is clear, if the complainant is contracted by any of the diseases, other than referred to in the Clause 4.3 during the first 30 days from the date of the commencement of the policy he is not entitled to claim reimbursement. But the note provided that, medical practitioners were to certify that, the insured could not have known the existence of the disease or any symptoms or complaints at the time of making the proposal for insurance, the exclusion Clause 4.2 has no application. In the instant case, as seen from the proposal form Dr. M.N. Krishna Murthy, has certified that, the ECG of the complainant is normal. If that is so, the complainant could not have known the existence of any disease relating to heart as on the date of filing of proposal form. Further, the complainant also could not anticipate the cardiac arrest as there were not symptoms of cardiac arrest, as his ECG was normal, as on the date of proposal for insurance. If that is so, the exclusion Clause 4.2, has no application even though, the complainant had undergone bypass surgery within 30 days, from the date of the policy, on account of sudden cardiac arrest.

THE District Forum has awarded the interest at the rate of 18% per annum. In the normal course, in cases of insurance, interest rate to be awarded is only 9% and not 18%. Hence, we pass the order as follows: THE appeal is disposed of in modification of the order of the District Forum: (1) THE appellant: O.P. is directed to pay Rs. 1,60,000/-, to the complainant with interest at 9% per annum from the date of the claim application till realisation. (2) THE costs awarded by the District Forum is kept undisturbed.

Appeal disposed of.