The main legal point established in the judgment is the requirement for insurers to provide evidence to support the repudiation of claims based on pre-existing diseases and substance abuse, and the duty to adhere to the principle of utmost good faith in insurance contracts.

ORDER

Gurcharan Singh Saran, Presiding Judicial Member. - Complainant has filed this complaint against the opposite parties (hereinafter referred as Ops) under Section 17 of the Consumer Protection Act, 1986 (for short the Act) on the averments that he purchased a Health Companion Health Insurance Policy No. 30368041201400 from Ops on 20.10.2014, which was valid for the period of one year from 20.10.2014 to 19.10.2015 for himself, for his wife and 2 children for sum insured of Rs. 24 Lacs after paying premium of Rs. 46,054/- through authorized agent. After a year the policy was got renewed vide policy No. 30368041201501 for the period 20.10.2015 to 19.10.2016 for himself, for his wife and two children for sum insured of Rs. 24 Lacs after paying premium of Rs. 50,815/-. During the coverage of insurance policy, complainant was hospitalized in Fortis Escort Hospital, New Delhi from 7.12.2015 to 12.1.2016. He underwent surgical treatment of liver transplant for a total amount of Rs. 22,15,000/- and also spent Rs. 45,528/- as post hospitalization expenses. No intimation was received by the complainant from Ops for cashless treatment, therefore, the complainant paid the entire amount to the hospital. After discharge from the hospital, the complainant immediately sent the claim form with discharge summary and final invoice to the ops. However, after a gap of about 2 months, to the utter shock and dismay to the complainant, he received a letter dated 7.4.2016 stating that the claim of the complainant has been rejected as his claim did not fall under the personal 2 years waiting period for Cerebrovascular Diseases and Pre-existing Hypertensive Diseases. However, the Ops have illegally rejected the reimbursement claim of the complainant. At the time of admission, the Ops have allowed a claim of Rs. 50,000/- vide letter dated 7.12.2015 but lateron vide letter dated 22.12.2015, they had cancelled the authorization of cashless discharge of the hospital and also cancelled the previous authorization letter dated 7.12.2015. Without going through the documents, the Ops declared the complainant a patient having history of chronic liver disease. The complainant tried to contact Ops in order to clarify the issue and in order to claim for reimbursement but Ops No. 1 & 2 not only rejected his claim but also harassed him. The complainant continued to send a notice to the Ops through email seeking clarification regarding reasons for declining the claim and the basis on which it was declared that the complainant had a hypertension problem. Ops vide email dated 26.5.2016 replied that the claim was reviewed by their Doctors based upon the medical record and the medical treatment taken by the complainant and that the medical treatment taken by the complainant falls under the permanent exclusions. Alongwith the reply, they attached another denial letter showing history of hyper tension for the last 5 years. The ground taken by the Ops to reject the claim of the complainant is grossly illegal, arbitrary as the complainant did not suffer from hyper tension or chronic liver disease. Alleging deficiency in service on the part of Ops, this complaint has been filed by the complainant seeking claim of Rs. 23 Lacs alongwith interest @ 18% p.a. from the date of submission of the mediclaim till the date of payment Rs. 5 Lacs as compensation for mental agony and harassment and Rs. 1 Lac as litigation cost.

2. Upon notice, Ops appeared and filed their written reply taking preliminary objections that the complainant suppressed the material facts from the Commission, therefore, the complaint is liable to be dismissed; the policy No. 30368041201400 was issued by the Ops to the complainant on the basis of information provided by the assured in the proposal form dated 14.10.2014. This information has been established to be incorrect, therefore, the Ops were well within its rig