The main legal point established in the judgment is the obligation of the proposer to disclose material facts in a contract of insurance, and the influence of material facts on the insurer's decision to accept the risk.

ORDER :

Dr. Monika Malik, Member (Mrs.)-This is a complaint under Section 17 of the Consumer Protection Act, 1986 claiming reimbursement of medical expenses, borne by the complainant in his overseas visit, with compensation for mental agony and punitive damages totalling to US $ 1,81,851.19.

2. The case of the complainant is such that he had obtained an ‘Overseas Mediclaim Policy’ from the Oriental Insurance Company in the year 2002. No claim was preferred by him, in that duration. He again intended to go abroad in the year 2005 and he approached opposite party No. 1 and obtained an ‘Overseas Mediclaim Policy’ for a period commencing from 6.7.2005 to 1.1.2006. The complainant had obtained a policy for a sum of 5,00,000 US Dollars. The complainant was to visit his son and daughter respectively, who are residing in Canada and USA. The said policy was issued on 6.7.2005 and was to expire on 1.1.2006. The complainant paid a total amount of Rs. 31,182 as premium against that policy. The complainant thereafter extended his stay and his policy was further extended for 146 days i.e. till 1.5.2006. On 18.1.2006 the complainant found that he was unable to move right side of his body and there was no sensation in his right side. The complainant was required to be admitted in El Camino Hospital, Mountain View, California and he was diagnosed with stroke and atrial fibrillation which was apparently found to be a new onset. The complainant was treated in the Hospital and thereafter, he subsequently lodged the claim with the opposite parties, who repudiated the same vide their repudiation letter dated 9.2.2006, stating that the complainant had suppressed that he had diabetes mellitus, hypertension, dyslipidemia, nicotine dependence, and the same was not disclosed by him to the Insurance Company at the time of proposing for the insurance cover. The complainant alleged that he had given loaded premium in order to obtain the insurance cover and it is highly unfair on the part of opposite parties to have repudiated his insurance claim. The complainant subsequently filed a complaint before this Commission, alleging deficiency in service on the part of the opposite parties.

3. The opposite parties resisted the complaint stating that the complainant had given written assurance to the Insurance Company and his policy was issued in utmost good faith. The complainant was having diabetes mellitus, hypertension, dyslipidemia and nicotine dependence which are related to the coronary diseases. Apart from this, the complainant had undergone cataract operation which not disclosed by him while filling up the proposal form. The insured had not disclosed pre-existing medical conditions and the condition like hypertension results in exclusion of all heart and circulatory disorders and their complications, therefore, his claim is not payable. It is further submitted that the loaded premium, which was taken from the complainant was not taken for covering the ailment which was already existing and this does not mean that the Insurance Company is bound to settle the claim, whether it is legitimate or not.

4. Heard. Perused the record.

5. Learned Counsel for the complainant submits that the general exclusion with regard to pre-existing ailment, is regarding any sickness for which the insured person has sought medical advice or has taken medical treatment in the preceeding 12 months prior to the commencement of travel. He argued that it is significant to note that at the time of filling up of the proposal form, there was no medical problem associated with the complainant’s health and he was not under treatment for any disease. The policy covered the risk of various eventualities, which also included illness, for which the risk cover was up to US $ 5,00,000. At the time of discharge from ‘El Camino Hospital’, the complainant’s condition was improved and stable. He argu