IMPORTANT POINT
Contract of Insurance – A contract of insurance is one of utmost good faith. A proposer who seeks to obtain a policy of life insurance is duty bound to disclose all material facts bearing upon the issue as to whether the insurer would consider it appropriate to assume the risk which is proposed.

ORDER

The present Revision Petitions have been filed by the Petitioner under Section 21(b) of the Consumer Protection Act, 1986 (‘the Act’) against impugned order dated 27.11.2020, passed by the learned State Consumer Disputes Redressal Commission, Odisha, Cuttack, (‘the State Commission’) in First Appeal Nos. 443 and 540 of 2013 wherein the State Commission allowed the FA No.443 of 2013 filed by the Respondents/Opposite Parties (OP) and dismissed FA No.540 of 2013 filed by the Petitioner/Complainant against the order dated 22.08.2013 passed by the learned District Consumer Disputes Redressal Forum, Cuttack (‘the District Forum’) wherein the District Forum had allowed the complaint filed by the Petitioner/ Complainant and directed the Respondents/OPs to pay Rs.45,000/- after deducting the payment, if any, made by the Opposite Parties as the medical expenses incurred by the Petitioner/Complainant at Narayan Hrudalaya, Bangalore and to pay a sum of Rs.5,000/- as compensation for mental and harassment and Rs.1000/- as litigation cost within two months from the date of receipt of the order.

2. There was two days delay in filing the Revision Petitions. For the reasons stated in IA/2220/2021, the delay is condoned.

3. For convenience, the parties are referred to as placed in the original Complaint filed before the District Forum.

4. The brief facts of the case, as per the Complainant are that the Complainant had purchased a medi-claim policy from the OPs vide Policy No. U154417497 paying the annual premium of Rs.20,000/- which was valid from 27.11.1999 to 26.11.2010. The policy was renewable on further payment of Rs.20,000/- and as such the policy was extended till 26.11.2011. It is alleged that during validity of the policy, the Complainant faced certain respiratory problems and was referred by the local physician to Narayan Hrudalaya, Bangalore. She was hospitalised in the said hospital from 26.10.2010 to 30.10.2010. On production of cashless card issued by the OPs, the said hospital did not accept the same on the plea that the policy had lapsed. When she informed OP-2, she was informed that there is some official problem in the policy data and the Complainant can pay charges and the amount will be reimbursed on her return to headquarters. The Complainant incurred expenses towards cost of health checkup and medicines all together Rs.45,000/-. After return to Cuttack she filed the claim with bills for reimbursement of Rs.45,000/-. But, on 25.4.2011 the OPs repudiated the claim on the grounds of supressed the pre-existing disease and treatment taken. Being aggrieved she filed a Complaint in the learned District Forum.

5. In reply, the OPs contended that the Complainant did not approach with clean hands and suppressed the material facts before the District Forum. On 27.11.2009 she purchased the said TATA AIG Life Insurance policy and paid annual premium of Rs.20,000/- for assured “Daily Hospital Benefit” of Rs.500/-. The said policy was issued based on the representation and declaration made by her in the proposal form dated 25.11.2009. In reply to the questionnaires of the application form, she concealed the fact that she was treated for intermittent Left Bundle Branch Block prior to applying for insurance policy. The policy was issued as per inputs provided in Application form dated 25.11.2009. OPs alleged that having suffered from such disease, she suppressed material fact in the proposal form and made claim after having suffered hypertension and cardiac disease and got treated at Narayan Hrudalaya, Bangalore. Since material facts have not been disclosed in proposal form, the Insurance Company was justified in repudiating the claim of the Complainant.

6. The learned District Forum vide Order dated 22.08.2013 allowed the complaint and granted the following relief:—

“In the result, the complaint petition is allowed on contest against the Opp. Parties. The Opp. Parties are directed to pay a sum of Rs.45,000/- after deducting the pay