Case: LIFE INSURANCE CORPORATION OF INDIA Vs. MANISH GUPTA

3. The respondent obtained a Mediclaim policy from the appellant. On 7 June 2008, he had submitted a proposal form for a Health Plus policy. The policy was issued on 25 June 2008 under the category of Non-Medical General for a sum of Rs 1,60,000. The proposal form required a disclosure of health details and medical information. Among them was whether the proposer had suffered from cardiovascular disease e.g.: Palpitations, heart attack, stroke, chest pain. The proposal form contained a response in the negative to the above query4. The Third Party Administrator received a hospital claim form on 7 August 2009, submitted by the respondent, which was certified by a doctor at Fortis Hospital, Mohali on 4 August 2009, during which period he had undergone a Mitral Valve Replacementsurgery. The claim was repudiated by the appellant on 29 October 2009 on the ground that the respondent was suffering from a pre- existing illness5. The expression pre-existing condition is defined in the exclusions under the policy in the following terms:ii. Pre-existing condition - any medical condition or any related condition (e.g. illnesses, symptoms, treatments, surgery, pains) that have arisen at some point prior to theii. Any Sickness, illness, complication or ailment arising out of or connected to the pre- existing illness6. The District Forum held in favour of the respondent. The NCDRC, while affirming the SCDRC, held that though the treating doctor had recorded, under the column of past history, that this was a known case of rheumatic heart disease since childhood, the doctor had not been examined in order to prove how the information had been recorded in his report. According to the NCDRC, the notes of the doctor did not indicate that it had been recorded on the basis of the information furnished by the patient. In this view of the matter, the decision of the District Forum, as affirmed by the SCDRC, has not been interfered with.

Reasoning:
9. We have adverted to the specific disclosure which was required in the proposal form in regard to whether the proposer had suffered or was suffering from cardiovascular disease. Illustrations of cardiovascular disease are given in entry 6(c) of para E of the proposal form. These are: palpitations, heart attack, stroke and chest pain. These are only illustrations. Significantly, the declaration by the proposer is in the following terms:I Munish Gupta hereby declare that I have read the proposal form fully and the same was interpreted to me by the agent and also declare that I have understood the nature of the questions and the importance of disclosing all material information while answering such questions. I hereby declare that the foregoing statements and answers to all questions, including those in the annexures signed by me, have been given by me after fully understanding the questions and the same are true and complete in every particular and that I have not withheld any information and I do hereby agree and declare that these statements and this declaration shall be the basis of the contract of assurance between me and the Life Insurance Corporation and that if any untrue averment be contained therein, the said contract shall be absolutely null and void and all monies which shall have been paid in respect thereof shall stand forfeited to the Corporation10. Moreover, non-disclosure of any health event is specifically set out as a ground for excluding the liability of the insurer.11. The declaration which was furnished by the proposer constituted the basis for the issuance of the policy. This was particularly so in a case such as the present where no medical examination has been held, for a policy under the NMG category13. The past history has been adverted to as a known case of rheumatic heart disease since childhood. Apart from the fact that this information would be recorded on the basis of information divulged by the patient, this aspect of the recording of the past history by Fortis Hospital was never in dispute. The treatment record indicates that the respondent was operated for MVR. The nature of the diagnosis has been reflected as rheumatic heart disease. The hospital treatment form is along the same lines15. The consumer fora have made a fundamental error in allowing the claim for reimbursement of medical expenses in the face of the uncontroverted material on record. The documentary material indicates that there was a clear failure on the part of the respondent to disclose that he had suffered from rheumatic heart disease since childhood. The ground for repudiation was in terms of the exclusions contained in the policy. The failure of the insured to disclose the past history of cardiovascular disease was a valid ground for repudiation.