Full Text
HIGH COURT OF DELHI
M/S UNITED INDIA INSURANCE COMPANY LIMITED ..... Appellant
Through: Mr. G.S. Ahuja, Advocate.
Through: Mr. Kailash Chand Goel, Advocate for R-1 along with R-1 in person.
JUDGMENT
1. The human gene in all its myriad combinations decides the traits of an individual human being. While most genetic traits of human beings have a positive expression, there are certain traits which could cause abnormalities. Such abnormalities are termed as `genetic disorders'. Genetic disorders are subject matter of research and development in the search of newer drugs to cure them but are also subject matter of debate, world over, in the context of health insurance. The question raised in the present case is whether persons having genetic disorders can be discriminated against in the context of health insurance. 2018:DHC:1381
A.1. The Respondent/Plaintiff (hereinafter „Plaintiff‟) took an insurance policy for himself along with his wife and daughter, from the Appellant/Defendant (hereinafter „Defendant‟) being Policy No: 041703/48/11/97/00000934 which is valid and subsisting. The said policy is a medi-claim Policy where the sum insured is Rs.[5] lakhs per individual. The Plaintiff submits he had first taken a medi-claim on 11th September, 2000 with the National Insurance Co. Ltd. vide policy No. 2000/8100540. The said policy was shifted to Defendant on 10th September, 2004, after which the policy was renewed continuously year to year without break till 10th September, 2012. The Plaintiff suffers from HOCM i.e. Hypertrophic Obstructive Cardiomyopathy (hereinafter `HOCM'). He was hospitalised on 23rd January, 2004 and 27th February, 2006 and his claims for the said periods have been honoured and payments were made by the Insurance Company. A.[2] The Plaintiff was again hospitalised for treatment on 27th November, 2011 and was discharged on 30th November, 2011. He made a claim for an amount of Rs.7,78,864/- with the Defendant. The said claim was rejected vide letter dated 6th February, 2012 where the reasons for rejection were mentioned as - "...We are closing your claim file, on account of the following reasons:- TPA Vipun Medcorp P Ltd had repudiated your claim. Since genetic diseases are not payable as per the policy, genetic exclusion clauses”. (extracted verbatim) A.3. It is the Plaintiff‟s case that the exclusion of genetic disorders was not a part of the initial policy which was availed by him but was added as part of the `Exclusions' in a later policy document, without specific notice to him and hence the said exclusions do not bind him. However, the stand of the Defendant was that HOCM is a genetic disorder which is clearly excluded and hence the claim is not liable to be entertained. A.4. The Plaintiff issued a legal notice on 30th March 2012, calling upon the Defendant to pay a sum of Rs.7,78,864/-, the breakup of which is as under: - “9.That the defendants have committed breach of trust with the plaintiff for which the defendants are liable to face civil and criminal consequences before the competent court of law. It is submitted that the Defendants are liable to pay the amount i.e:
(i) Medi-claim Amount Rs.5,00,000/-
(ii) Damages Rs.2,78,864/-
Total: Rs.7,78,864/- (Rs. Seven Lakh Seventy Eight Thousand Eight Hundred Sixty Four) alongwith interest @ 12% per annum.” He received a reply on 24th April, 2012 that the claim cannot be paid as `genetic disorders' are excluded in the policy document. The Plaintiff then filed a suit for recovery against the Defendant praying for a decree for the sum of Rs 7,78,864/-. The Prayer clause in the plaint reads: " It is, therefore most respectfully prayed that the Hon'ble court may please to pass a decree of Rs. 7,78,864=00 (Rs. Seven Lakh Seventy Eight Thousand Eight Hundred Sixty Four Only ) along with interest @ 12% p.a. since the filling of the suit till the realization of decretal amount. Cost of the suit may also be awarded in favour of the plaintiff and against the defendants." A.5. The Defendant in its written statement relied upon clause 4, specifically 4.17 which excludes genetic disorders from being claimed. The Defendant further sought to justify rejection of the claim on the ground that HOCM is a genetic disorder and hence the amount is not liable to be paid. The Defendant sought to blame the Plaintiff for not having gone through the terms and conditions of the policy. A.6. The Plaintiff led the evidence of five witnesses including himself. He summoned three officers from the defendant insurance company and a doctor from Fortis Escorts Heart Institute, New Delhi. PW-1 – Plaintiff Himself PW-2, PW-4 & PW-5 – M/S United India Insurance Company Limited PW-3 – Doctor of Fortis Escorts Heart Institute All relevant documents were exhibited including the insurance policy, rejection letter, renewals thereof, etc. The Trial Court has, summarised the evidence of all the witnesses in paragraph 12 of the impugned judgment. A.7. The Trial Court held that an insurance policy has to be renewed on the existing terms and conditions, and at the time of renewal fresh clauses and exclusions cannot be added. The Trial Court held that no advance notice was given to the Plaintiff and that some new clauses have been added to the policy. A.8. The Trial Court thereafter went into the question of whether the ailment of the Plaintiff was validly excluded from the medi-claim policy, and if so, had the Defendant acted contrary to law. The Trial Court observes that twice in the past, for the same disease, the claims of the Plaintiff had been approved. The Trial Court thereafter held that there cannot be a discriminatory clause against those persons who suffered from genetic disorders and they are entitled to medical insurance. The Trial Court decreed the suit for a sum of Rs.[5] Lakhs alongwith interest of 8% per annum and rejected the claim for damages of Rs 2,78,864/-. A.9. When the appeal was listed before this Court on 22nd August, 2017, the Defendant was directed to deposit the decretal amount. Thereafter, the same has been released to the Plaintiff on 28th April, 2017, subject to furnishing of a bank guarantee to the satisfaction of the Registrar General. The bank guarantee has been filed by the Plaintiff and is alive till 24th August, 2018. A.10. None had appeared for the Defendant, arguments were heard on behalf of the Plaintiff and judgement was reserved. Thereafter, the Counsel for the Plaintiff mentioned the matter and made his submissions before the Court. A.11. The admitted facts in this case are: The Plaintiff had obtained an insurance policy from the Defendant. The same was duly renewed from time to time and is valid and subsisting. The Plaintiff had on two earlier occasions i.e., on 23rd January, 2004 and 27th February, 2006 obtained claims to the tune of Rs.1,04,640/and Rs.3,30,000/- respectively from the Defendant. The hospitalisation of Plaintiff on 27th November, 2011 at Fortis Escort Heart Institute, New Delhi is not disputed. The doctor from the said institute had appeared as a witness and had produced the entire hospital record. All the policy documents were produced by representatives of the Defendant who were summoned by the Plaintiff. A.12. The two clauses from the insurance policy which are relevant to the case at hand are - “1.[1] NOW THIS POLICY WITNESSES that subject to the terms, conditions, exclusions and definitions contained herein or endorsed, or otherwise expressed here on the Company undertakes that during the period stated in the Schedule, if any insured person(s)contracts any disease or suffers from any illness (hereinafter called INJURY) and is such disease or injury requires such insured Person upon the advice of a duly qualified Physician/Medical Specialist/Medical practitioner (hereinafter called MEDICAL PRACTITIONER) or of a duly qualified Surgeon (hereinafter called SURGEON) to incur hospitalisation/domiciliary hospitalisation expenses or medical/surgical treatment at any Nursing Home/Hospital in India as herein defined (hereinafter called HOSPITAL) as an inpatient, the Company will pay through TPA to the Hospital/Nursing Home or the Insured Person the amount of such expenses as are reasonably and necessarily incurred in respect thereof by or on behalf of such Insured Person but not exceeding the Sum Insured in aggregate in any one period of insurance stated in the schedule hereto....
4. EXCLUSIONS:-.... 4.1-4.16
4.17 Genetic disorders and stem cell implantation/ Surgery” Thus, the Insurance Company would pay the sum insured in the policy „subject to‟ the exclusion clause. If the medical condition is covered by any of the exclusions, the claim is liable to be disallowed. „Genetic disorders‟ is one such exclusion. A.13. The two questions that arise are -
(i) Whether the exclusion in relation to „genetic disorders‟ is valid and legal?
(ii) Whether the exclusionary clause 4.17 relied upon by the
B.1. In order to determine question no.1, the meaning of the term „genetic disorders‟, needs to be understood. Genes are responsible for the various traits that human beings possess. It is the difference in these traits that makes one human being different from the other. While genes pass on several positive characteristics, they could at times be responsible for some abnormal medical conditions which are passed on from one generation to another. Such abnormal medical conditions which are passed on are termed as „genetic disorders‟. The inherited traits leading to disorders could either be dominant or recessive. If the trait is dominant, the disease will surface and if the gene is recessive the trait would not show up, but the individual would be a carrier of the gene and could pass it on to the next generation. B.2. As per the National Human Genome Research Institute[1], there are several types of genetic disorders. They are - Monogenetic disorders - They are caused by the mutation in a single gene. Eg: Sickle cell disease Multifactorial inheritance disorders - Caused by a combination of genetic and environmental factors. Eg: Diabetes, Cardiac diseases and some forms of Cancer; Chromosome disorders - Caused due to either deficiencies or excesses of the genes or due to structural changes in the chromosomes. Eg: Down syndrome, Chronic Myeloid leukamia. B.3. Thus there are several medical conditions which could be partially attributable to genetics, but could also be attributable to several other factors, such as lifestyle, environmental conditions, dietary habits, etc. Detailed genetic testing is required in order to determine the nature of the genetic disorder, in the absence of which, it would be medically impossible to determine whether a broad medical condition is a pure genetic disorder i.e, solely attributable to a gene or to the several other factors which could contribute. B.4. The fact that there are different types of genetic disorders and even common diseases like diabetes and cardiac diseases could be included in the broad definition, and makes the exclusion vulnerable. In effect, it would mean that large swathes of population would be excluded from availing health insurance which could have a negative impact on the health of a country. National Human Genome Research Institute, 24/02/2018, www.genome.gov/19016930/faq B.5. Thus, it is necessary to determine the legality of such an exclusion in insurance policies. Moreover, in order to exclude genetic disorders from insurance claims, there has to be genetic testing, which is itself a complex and expensive process. The data, so collected from testing also needs to be preserved and confidentiality has to be maintained. Without doing genetic testing and prescribing what is the kind of genetic disorder which is excluded, applying a general exclusion would lead to arbitrariness.
C.1. Genetic discrimination in the context of insurance has been subject matter of several International Covenants, Directives, laws and regulations in various countries. Though there is lack of uniformity in the nature of regulation, the unanimous opinion appears to be that discrimination based on genetic heritage and disposition is contrary to human rights and in the context of insurance, exclusions relating to genetic disorders is heavily regulated. Even the collection of genetic data, preservation and maintenance of confidentiality of the data is a subject matter of grave concern. C.2. The Universal Declaration of Human Rights, 1948 recognises that: “Everyone has a right to a standard of living adequate for the health and well-being of himself and his family, including food, clothing, housing and medical care, and necessary social services, and the right to security in the vent of unemployment, sickness, disability, widowhood, old age, or other lack of livelihood in circumstances beyond his control”2 Universal Declaration of Human Rights, UN § 25 (December10,1948) Thus, medical care is a basic human right, universally recognised as far back as in 1948. In the modern world, when health care costs are very high, availing health insurance is an integral part of medical care. European Union (E.U) C.3. At a regional level, the 1997 Council of European‟s Convention for the Protection of Human Rights and Dignity of the Human Being with regard to the application of Biology and Medicine stipulates that „Any form of discrimination against a person on grounds of his or her genetic heritage is prohibited.‟3 The European Convention on Human Rights & Biomedicine expressly bars discrimination of any kind on the basis of genetic heritage. In fact, Article 12 of the said convention only permits genetic testing for the purposes of health or for scientific research.[4] This has led a large number of European countries including Austria, Belgium, Switzerland, Luxembourg, Denmark, Portugal to enact legislations in respect of genetic data and regulation of such data. C.4. Following the above Convention, certain recommendations have been made and accepted by the Community Minister in Europe which seeks to strike a balance between the legitimate interest of the insurer and the level of risk presented by the insured. These recommendations have a specific prohibition in principle no.4 which is set out below: “Principle 4- Insurers should not require genetic tests for insurance purposes.” “15.In accordance with the principle laid down in Article 12 of the Convention on Human Rights European Convention on Human Rights & Biomedicine § 11, Oviedo (1997) European Convention on Human Rights & Biomedicine § 12, Oviedo (1997) and Biomedicine, predictive genetic tests must not be carried out for insurance purposes.
16. Existing predictive data resulting from genetic tests should not be processed for insurance purposes unless specifically authorizes by law. If so, their processing should only be allowed after independent assessment of conformity with the criteria laid down in paragraph 5 by type of test used and with regard to a particular risk to be insured.
17. Existing data from genetic tests from family members of the insured person should not be processed for insurance purposes.”5 C.5. The Charter of Fundamental Rights of the European Union, which enlists the various freedoms for the people of Europe and is based on the Constitutions of its member states protects the Right to life[6] under Article 2, Right to Liberty and Security, Freedom of Expression etc. Relevant to the issue, however, are Articles 20 and 21. The principle of non-discrimination as per this Charter extends to protection against any discrimination based on genetic features. Articles 20 and 21 are set out below: “Article 20 Equality before the law: Everyone is equal before the law. Article 21 Non-discrimination:
1. Any discrimination based on any ground such as sex, race, colour, ethnic or social origin, genetic features, language, religion or belief, political or any other opinion, membership of a Recommendation CM/Rec(2016)8 of the Committee of Ministers to the member States on the processing of personal health related data for insurance purposes, including data resulting from genetic tests, Chapter[3], Principle 4. Charter of Fundamental Rights of the European Union, EU § 21 (December18,2000) national minority, property, birth, disability, age or sexual orientation shall be prohibited.
2. Within the scope of application of the Treaty establishing the European Community and of the Treaty on European Union, and without prejudice to the special provisions of those Treaties, any discrimination on grounds of nationality shall be prohibited.” C.6. Several researchers are of the view that Article 21 applies to insurance policies and thus, this provision bars insurers from seeking genetic testing as a pre-condition for insurance contracts. When read in conjunction with Article 11 of the Convention on Human Rights and Biomedicine, it appears that in Europe, genetic testing, modification of insurance contracts based on such testing, or discrimination based on genetic heritage or genetic features are barred.[7] C.7. Several countries across the world have enacted laws in respect of genetic discrimination by insurance corporations. The said laws regulate and govern exclusion of genetic medical conditions from insurance policies as also the collection, preservation of genetic data. C.8. The Austrian Gene Technology Act, 2005 prohibits the collection and use of data for genetic tests[8] and use stringent provisions in respect of prior consent[9] to be obtained before doing a genetic test. The only exception is that genetic tests are allowed for only scientific and educational purposes.10 The Austrian Gene Technology Act, 2005 permits genetic testing on humans only for scientific purposes and for education and strict data protection European Convention on Human Rights & Biomedicine § 11, Oviedo (1997). Austrian Gene Technology Act, § 67 (2005) Austrian Gene Technology Act, § 71 (2005) Austrian Gene Technology Act, § 66 (2005) measures have been enacted.11 In Belgium, any contract that discriminates on the basis of genetics is void.12 In Switzerland, any discrimination based on genetic information is prohibited unless the same is required for preservation of health.13 C.9. In Estonia, the Human Genes Research Act of 2001 contemplates the establishment and maintenance of a gene bank for organization of genetic research and maintaining the confidentiality of the same.14 The gene bank can be used only for scientific research, public health research and data analysis.15 A specific bar is contained in Section 27 which reads as under: “§ 27. Discrimination in insurance relationships (1) Insurers are prohibited from collecting genetic data on insured persons or persons applying for insurance cover and from requiring insured persons or persons applying for insurance cover to provide tissue samples or descriptions of DNA. (2) Insurers are prohibited from establishing different insurance conditions for people with different genetic risks and from establishing preferential tariff rates and determining insured events restrictively.”16 C.10. In Finland, the Insurance Companies Federation has adopted a policy of not asking questions about genetic tests in connection with risk assessment and they also maintain the confidentiality of data generated from genetic tests undergone by consumers. In risk assessment, Finnish insurance Austrian Gene Technology Act, § 66&67 (2005) The Introductory Bill of Belgium § 3 (2002) The Swiss Academy of Medical Sciences, Medical-ethical Guidelines for Genetic Investigation in Humans, Paragraph 3.9, Pg[6] Human Genes Research Act of Estonia § 1 (2001) Human Genes Research Act of Estonia § 16 (2001) Human Genes Research Act of Estonia § 27 (2001) companies do not pose questions or use information on the status of health of relatives of applicants.17 C.11. France has gone a step ahead and has recognised in Article 16-10 of its civil code that genetic studies are permissible only for medical purposes or scientific research18 and use of genetic data is, in fact, an offence.19 C.12. In Ireland, genetic testing is permissible only if the testing is not prohibited by law, however, genetic data cannot be processed in relation to a policy of life insurance or health insurance.20 Violation of this provision has been deemed to of an offence under this Act.21 Family history related information can however be collected but the said data is also protected.22 C.13. In Spain, the Constitution itself prohibits discrimination on the grounds of personal or social circumstances which applies to both employers and insurers.23 C.14. In Sweden, on the other hand, the Genetic Integrity Act, 2006 permits the use of genetic information in insurance. Section 2 of the said Act reads as under: “With regard to risk-related personal insurance, notwithstanding the provisions of Section 1, second paragraph, first sentence, an insurance company may inquire into or use genetic information in connection with entering into, amendment or renewal of an agreement, provided that Federation of Finnish Insurance Companies, 1999 (Now Federation of Finnish Financial Services) Moratorium 1999 Civil Code of France, Article 16-10, Law n. 94-653 (July 29,1994). Code Penale of France, Article 226-26, Law n.94-654 (July 29,1994). Disability Act of Ireland § 42(2) (2005) Disability Act of Ireland § 42(4) (2005) Disability Act of Ireland § 43 (2005) Spain. Constitution. § 10 Chapter 2
1. the person insured is over the age of 18 years and the amount insured that becomes payable in the event of an insurance loss is a lump sum in excess of 30 price base amounts as defined by the National Insurance Act (1962:381), or
2. the person insured is over the age of 18 years and the amount insured that becomes payable in the event of an insurance loss is a periodic indemnity in excess of four price base amounts per year.” 24 It is, however, unclear as to whether genetic disorders can be excluded. United Kingdom C.15. In the U.K, the position appears to be different. As per publicly available records, an agreement has been entered into by which the Government and the Association of British insurers have agreed to a broad policy framework (Concordat Act).25 Under this framework, there is a voluntary moratorium on insurer‟s use of predictive genetic test results until 1st November, 2019. Under this agreement -
D.3. The Supreme Court has further held in LIC of India & Anr. v. Consumer Education & Research Centre & Ors. (1995) 5 SCC 482 (hereinafter, „LIC of India‟) that insurance contracts have to stand the test of reasonableness. Relevant extract reads:
4.12 Treatment arising from or traceable to pregnancy (including voluntary termination of pregnancy) and childbirth, (including caesarean section)
4.13 Naturopathy Treatment” Thus the policy for the year 2006-2007 did not exclude claims relating to genetic disorders or any genetic disposition. However, in the policy document Exhibit PW-2/1 for the year 2011-2012 (Gold Category), the clause relating to Exclusions has been expanded as under: “4. EXCLUSIONS: The company shall not be liable to make any payment under this policy in respect of any expenses whatsoever incurred by any Insured Person in connection with or in respect of: 4.[1] Any pre-existing condition(s) as defined in the policy, until 48 months of continuous coverage of such insured person have elapsed, since inception of his/her first Policy with the Company. 4.[2] Any disease other than those stated in clause 4.[3] and 4.[4] below, contracted by the insured person during the first 30 days from the commencement date of the policy. This exclusion shall not however, apply in case of the Insured person having been covered under an Insurance Scheme with our company for a continuous period of preceding 12 months without any break. 4.[3] During the first two years of the operation of the policy, the expenses on treatment of diseases such as Cataract, Benign Prostatic Hypertrophy, Hysterectomy for Menorrhagia or Fibromyoma, Hernia, Hydrocele, Congenital Internal disease, Fistula in anus, piles, Sinusitis and related disorders, Gall Bladder Stone removal, Gout & Rheumatism, Calculus Diseases are not payable. 4.[4] During the first four years of the operation of the policy, the expenses related to treatment of Joint Replacement due to Degenerative Condition and age-related Osteo arthiritis & Osteoporosis are not payable. If these diseases mentioned in Exclusion no.4.[3] and 4.[4] (other than congenital internal disease) are pre-existing at the time of proposal they will not be covered even during subsequent period of renewal subject to the pre-existing disease exclusion clause. If the insured is aware of the existence of congenital internal disease before inception of policy, the same will be treated as pre-existing. 4.[5] Injury / disease directly or indirectly caused by or arising from or attributable to War, invasion, Act of Foreign enemy, War like operations (whether war be declared or not), 4.[6] a. Circumcision unless necessary for treatment of a disease not excluded hereunder or as may be necessitated due to an accident b. Vaccination and inoculation c. change of life or cosmetic or aesthetic treatment of any description such as correction of eyesight, etc. d. Plastic surgery other than as may be necessitated due to an accident or as a part of any illness. 4.[7] Cost of spectacles and contact lenses, hearing aids. 4.[8] Dental treatment or surgery of any kind unless necessitated by accident and requiring hospitalisation. 4.[9] Convalescence, general debility; run-down condition or rest cure, obesity treatment and its complications including morbid obesity, Congenital external disease/ defects or anomalies, treatment relating to all psychiatric and psychosomatic disorders, infertility, sterility, Venereal disease, intentional self injury and use of intoxication drugs / alcohol.
4.10 All expenses arising out of any condition directly or indirectly caused to or associated with Human T-Cell -Lymphotropic Virus Type III (HTLB - III) or lymphadinopathy Associated Virus (LAV) or the Mutants Derivative or Variation Deficiency Syndrome or any syndrome or condition of a similar kind commonly referred to as AIDS.
4.11 Charges incurred at Hospital or Nursing Home primarily for diagnosis x-ray or Laboratory examinations or other diagnostic studies not consistent with or incidental to the diagnosis and treatment of positive existence or presence of any ailment, sickness or injury, for which confinement is required at a Hospital / Nursing Home
4.12 Expenses on vitamins and tonics unless forming part of treatment for injury or diseases as certified by the attending physician
4.13 Injury or Disease directly or indirectly caused by or contributed to by nuclear weapon / materials.
4.14 Treatment arising from or traceable to pregnancy, childbirth, miscarriage, abortion or complications of any of these including caesarean section, except abdominal operation for extra uterine pregnancy (Ectopic Pregnancy) which is proved by submission of Ultra Sonographic Report and Certification by Gynaecologist that it is life threatening one of left untreated.
4.15 Naturopathy Treatment, acupressure, acupuncture, magnetic therapies, experimental and unproven treatments / therapies.
4.16 External and or durable Medical / Nonmedical equipment of any kind used for diagnosis and or treatment including CPAP, CAPD, Infusion pump etc. Ambulatory devices i.e. walker, crutches, Belts, Collars, Caps, Splints, Slings, Braces, Stockings, elastocrepe bandages, external orthopaedic pads, sub cutaneous insulin pump, Diabetic foot wear, Glucometer / Thermometer, alpha / water bed and similar related items etc., and also any medical equipment, which is subsequently used at home etc.
4.17 Genetic disorders and stem cell implantation / surgery.
4.18 Change of treatment from one system of medicine to another unless recommended by the consultant/ hospital under whom the treatment is taken
4.19 Treatment for Age Related Macular Degeneration (ARMD), treatments such as Rotational Field Quantum Magnetic Resonance (RFQMR), Enhanced External Counter Pulsation (EECP), etc.
4.20 All non medical expenses including convenience items for personal comfort such as charges for telephone, television, ayah, private nursing/barber or beauty services, diet charges, baby food, cosmetics, tissue paper, diapers, sanitary pads, toiletry items and similar incidental expenses.
4.21 Any kind of Service charges, Surcharges, Admission Fees/Registration Charges, Luxury Tax and similar charges levied by the hospital.” E.2. The policy documents for the other years are not being quoted for the sake of brevity. A perusal of the said documents, which are on record, shows that for the periods 2006-07, 2007-08, 2008-09, 2009-10, the exclusionary clause relating to genetic disorders does not exist. For the first time in the policy document for the year 2011-12, i.e. 11th September, 2011 to 10th September, 2012, the exclusion of genetic disorders appears. Thus, when the claim form was filled by the doctor, at Fortis Escort Heart Institute, New Delhi, on 30th November, 2011, the following question was answered as under– Item No. 9
9. Whether the disease/disorder is congenital or genetic in nature? Genetic E.3. The doctor at the hospital went by the exclusionary clause in the latest insurance policy and simply applied it. The question is, does the exclusion apply. E.4. The Plaintiff obtained the first insurance policy from the Defendant in
2004. He was therefore an old customer of the Defendant. He merely renewed the same from time to time. The medical condition for which he made a claim in 2006 for Rs.3,30,000/- was similar to the one he suffered in
2011. The claim at that time in 2006 had been honoured and there was no reason for the Plaintiff to believe that there was any change in the policy conditions. No evidence has been led by Defendant to show that the Plaintiff was made aware of the new exclusions, including the one for genetic disorders. E.5. The witness from the Defendant insurance company produced exhibits PW-2/1 and PW-2/2. He categorically submits that it is only exhibit PW-2/1 which contains the exclusionary clause. His cross-examination is relevant and is set out below: - “ I have brought the certified copy of summoned record which is pertaining to a policy bearing no. 041703/48/11/97/00000935 for the period 11.09.2011 to 10.09.2011, which stands issued in the name of Sh. Jai Prakash Tayal, which is Ex. PW 2/1. I have also brought the other record related with the policy of Sh. Jai Prakash Tayal, from 11.09.2006 to 10.06.2010. The same is exhibited as PW 2/2 (colly). I am also producing before this court the certified copy of renewal of individual medi-claim policy bearing no. 221983/48/05/20/00000288 in the name of Sh. Jai Prakash Tayal, the same is exhibited as Ex. PW 2/3. I have no personal knowledge about these policies. XXX by Sh. G.S. Ahuja, counsel for the defendant. It is correct that the various policies which stand issued in the name of insurer for different intervals, which have been filed today by me, were issued and handed over to the insured on each and every occasion. The policy Ex. PW 2/1 exclusively contains the term 4.17 which reads as "Genetic disorders and stem cell implantation / surgery." The documents submitted by the insured alongwith the claim, which are already Mark B (colly) contains the problem suffered by the injured in item no. 9 of the medical certificate filled by the Treating Doctor which is encircled at point X. I have not got executed a proposal form at the time of issuing a renewal in the year 2006. Whatever has been deposed by me, I have deposed as per record.” E.6. PW-3, Dr. S.C. Gupta, exhibited the records of the hospital including the discharge summary, namely; exhibits PW-3/A, PW-3/B and PW-3/C. He identified the signatures of all the doctors. The witness from Paramount Health Services (TPA) Pvt. Ltd., PW-4, placed on record the details of the settlement claim. The rejection of the claim is exhibited as PW-5/1, by PW- 5, the Administrative Officer of the Defendant insurance company. The rejection reads as under: “THE PATIENT HAS BEEN DIAGNOSED TO BE A CASE OF HYPERTROPHIC OBSTRUCTIVE CARDIOMYOPATHY (HOCM), POST SEPTAL & ICD ABLATION.
THIS IS RELATED TO GENETIC DISEASE WHICH IS NOT PAYABLE UNDER GENETIC EXCLUSION CLAUSE 4.17 OF GOLD POLICY (POSITIVE FAMILY HISTORY OF SUDDEN CARDIAC DEATH).
THE CLAIM MERITS REPUDIATION UNDER THE SAID CONDITION.
THE ORIGINAL CLAIM FILE OF RELEVANT DOCUMENTS ENCLOSED HEREWITH FOR YOUR APPROPRIATE ACTION.” E.7. The legal notice, Exhibit P-4, and the receipt thereof is duly admitted. An analysis of all the above documents leads to the conclusion that exclusion of genetic disorders did not exist in the earlier policies obtained by the Plaintiff and was included, without notice to the insured, in the last policy document for 2011-12. The mere fact that a new policy document is issued upon each renewal, does not change the basic nature of the contract. Any unilateral insertion or change in the clause of the contract has to be with the consent of the insured, and there is no evidence on record to show that this clause was brought to the notice of the insured. Thus, there was no „consensus ad idem‟ on the exclusionary clause contained in PW-2/1. It is merely a unilateral insertion which would not bind the Plaintiff. E.[8] The discharge summary dated 12th January, 2006 Exhibit PW-3/B records the history of the Plaintiff as under: “HISTORY: History of Presenting Illness: The patient is normotensive, nondiabetic, nonsmoker and has positive family history of sudden cardiac death. He is a known case of HOCM, underwent septal ablation on 01/12/2003. He had c/o chest pain on exertion and giddiness. Echo done revealed LVOT gradient 100mmHg. Holter done revealed isolation VPC‟s particular bigemini. He was admitted to this hospital for further evaluation and management.” E.[9] Dr. T.S. Kler of Fortis Escort Heart Institute, New Delhi issued a certificate dated 3rd May, 2012 to the following effect: “This is to certify that Mr. Jai Prakash Tayal vide EHIRC NO: 214290 is under my treatment since
2003. He has hypertrophic obstructive cardiomyopathy (HOCM), post septal ablation (2003), post ICD (2006). This disease though may have higher incidence of family occurance but in his case there is no history of any such disease before.” This certificate by Dr. Kler clearly states that in the plaintiff's case, HOCM is not due to a genetic disorder. The certificate issued by Dr. Kler has not been challenged and there is no evidence to the contrary that the medical condition of the Plaintiff was in fact genetic. E.10. Dr. Balraj Gupta Medical Director of the Insurance agency has said HOCM has a `definite heterogenecity'. This term is capable of different interpretations in this context. It could mean that HOCM has several causes but could also mean that it relates to different species of genes. Thus there is no clarity. The extract of this report reads as under: Dr Balraj Gupta “Hypertrophic obstructive cardiomyopathy (HOCM) has a definite heterogenecity in its cause, although the occurrence in general population is only 0.25% but it is transmitted as an autosomal dominant trait affecting males and females equally. This occurs worldwide. The treatment is in the form of abalation and ICD (implantable cardioverter defibrillator) implantation which was done in this particular case. This claim is not tenable because of a specific exclusion clause in the policy. The claim was rightly rejected after taking an opinion from a cardiologist as well.” E.11. However, the discharge summary already referred to above, of Fortis Escorts describes the Plaintiff's condition as under: Fortis Escorts- Dr Govind Goel “History of Presenting Illness: The patient is normotensive, non-diabetic, nonsmoker with positive family history of Ischemic heart disease. He is a known case HYPERTROPHIC OBSTRUCTIVE CARDIOMYOPATHY, underwent septal ablation on 02/11/2003, ICD implantation on 09/01/2006. He was admitted to FEHI for ICD replacement and further management.” Physical Examination: On Admission his Pulse 66/min, BP 110/70mmHg and physical examination revealed JVP was normal. No jaundice, pallor, clubbing, cyanosis or edema. CVS: S[1], S[2] normal. No murmur. Respiratory: Normal breath sound. No added sound. Abdomen: No hepatosplenomegaly. CNS: The patient is conscious and oriented to time, place and person. No neurological deficits.” Course in the Hospital: The patient underwent ICD pulse generator replacement on 28/11/2011. The procedure was uncomplicated and well tolerated. His general condition at the time of discharge is satisfactory.” Dr Vinod Sharma “By definition and design, the Hypertrophic Obstructive Cardiomyopathy (HOCM) is undoubtably a genetic disease that leads to hypertrophy i.e. thickening of heart muscles and in my opinion, if Insurance does not cover genetic disorder then rejection from your end is very much justified.” E.12. There are conflicting reports by doctors as to whether the condition of the Plaintiff is a genetic disorder at all. The opinions of doctors are not consistent. Opinion 1: Dr. Balraj Gupta HOCM has a definite heterogenecity in its cause but it is covered by the exclusions in the policy. Opinion 2: Discharge summary of Fortis Escorts by Dr. Govind Goyal Plaintiff has a family history of ischemic heart disease which is a known case of HOCM. Opinion 3: Dr. Kler. HOCM may have a higher incidence of family occurrence but in the Plaintiff's case there is no history of HOCM. Opinion 4: Dr. Vinod Sharma in Ex. PW5/1 HOCM is undoubtedly a genetic disorder. E.13.There was no genetic testing that was done to prove that the condition of the Plaintiff was a genetic disorder. In common knowledge, HOCM is not necessarily genetic in nature and the treatment for the same is primarily to prevent “sudden death”. In some cases it could be genetic. Unless there is testing, it cannot be conclusively held to be genetic in all cases. Thus while Dr. Gupta mentions that HOCM has a `definite heterogenecity in its cause' it means that there could be many causes, Dr. Sharma gives a categorical opinion that it is a genetic disorder and the Fortis clinical summary gives a different opinion. These varying opinions show that it is unclear if HOCM is a genetic disorder or not in the case of the Plaintiff. E.14. HOCM is treated usually by inserting an ICD which takes care of rhythm disturbances in the heart to prevent sudden death. The insurance company cleared the procedure undergone by the Plaintiff on the two earlier occasions and the present procedure was merely a replacement of the pulse generators of a device, which was already inserted in the Plaintiff. Thus the procedure that the Plaintiff underwent was nothing new. The device was already inserted on 2nd November, 2003 and only the pulse generator was being replaced in 2011. So in 2011, the condition was the same as in 2003 but the claim was rejected. E.15. Insurance documents are standard form contracts and usually the insured person signs on the dotted line. It would be extremely tenuous to expect a layman to read each and every clause of an insurance document before signing it. On most occasions, a person who intends to obtain insurance has no choice to say NO to a clause in an insurance policy. Medical insurance is primarily obtained for the purpose of unforeseen medical conditions which may affect a person and so long as there has been no fraud, concealment or suppression, at the time of obtaining insurance, policies ought to be honoured. It is usual to see claimants running from pillar to post in order to get medical reimbursement from insurance companies. This case is no different. In the insurance policy issued to the Plaintiff, no genetic testing was undertaken before hand. This obviously means that the exclusion of genetic disorder is being applied on the basis of family history and not on the basis of a specific test. Such application of exclusion lacks the foundation itself and is untenable. E.16. In every disease, there are four stages- i) prevention, ii) diagnosis & management, iii) cure iv) palliative care in non-curable diseases. Insurance would be required at every stage; diagnostic tests can begin with a simple lab report to complex diagnostic costing thousands of rupees. Management of a disease would include continuous administration of medicines for example in the case of diabetes and blood pressure or use of devices like a pacemaker and ICD in the case of a cardiac condition. Cure of a disease would include medicinal cures & surgical cures. In the case of diseases like cancer, the fourth stage of chemotherapy, medicinal administration and palliative care go hand in hand. To exclude any particular medical condition from availing insurance for any of the above steps in the journey of wellbeing could lead to loss of life. There could be different terms specified by the insurance company in the case of serious ailments, provided they stand the test of reasonableness and the differentiation is intelligible. E.17. A broad categorization and exclusion of genetic disorders of every and all kind would lead to enormous discretion in the hands of the insurance company to reject genuine claims. The ambiguity and the uncertainty of the precise definition of genetic disorders makes the exclusion too broad. Firstly, exclusion of genetic disorders by itself would be unconstitutional and the broad unqualified exclusion would not stand the test of nonarbitrariness and unreasonableness. E.18. There has been enormous thought, which has gone into such exclusions in most jurisdictions. Pure genetic disorders such as Huntington‟s disease, Down‟s syndrome, etc., can be treated differently in insurance policies. However, exclusion of the entire gamut of disorders which are speculatively genetic would be totally illegal. E.19. The Exclusion clause quoted above is one of the longest clauses in the policy having a wide umbrella of exclusions. A perusal of the exclusions in clause 4 of the policy and an analysis of the same reveals that the policy excludes more than it includes. Usually persons, who have paid premium for a long time, hope to be able to avail of medical insurance at a later stage in life. However, the manner in which the exclusions are worded, are so broad that it would be easy to reject any medical claim under one of the clauses in these exclusions. It is a known fact that citizens are usually not able to get insurance claims passed and it requires a lot of effort and time before their claims get passed. E.20. These exclusions deserve to be regulated in some manner in order to ensure that customers, who avail of medical insurance policy, are not made to run from pillar to post for passing of their claims. The exclusionary list is so long and so broad that almost every ailment could be said to fall under one of the clauses and then comes the final all encompassing exclusion of genetic disorders which would give too much freedom and arbitrary power to the insurance companies to reject genuine claims. On a specific query from the court, the Learned Counsel appearing for the insurance company stated that the exclusion of genetic disorder exists in almost all health insurance contracts and policies issued by general insurance companies. This is a major cause for concern. E.21. The exclusion of insurance claims in respect of genetic disorders creates a broad classification which is writ with ambiguity and vagueness. Since the term genetic disorder is capable of myriad interpretations, the differentiation is not intelligible and hence falls foul of Article 14 of the Constitution. Unless and until there is a proper genetic test in accordance with a strict regulatory mechanism, and the cause of the disorder is attributable solely to a genetic condition, the classification is too broad. Therefore, there is a need to bring in a policy for collection of genetic data, analysis and preservation of confidentiality, and for a precise definition of genetic disorders. E.22. A cause based exclusion in insurance contracts of reasons such as war, damage due to natural disasters, disorders caused due to nuclear material, etc. cannot be equated with genetic disorders. It is the settled position in our country that Right to Healthcare is a part of Right to Life, which is protected under Article 21 of the Constitution. With the spiralling costs of healthcare, health insurance is an integral part of healthcare. Thus, every citizen ought to be entitled to obtain health insurance and avail of claims arising therefrom. Though, insurance policies are contractual in nature, and parties to them are bound by it, the clauses of such a contract have to stand the test of Constitutionality. Insurance companies, especially those which are „instrumentalities of state‟ under Art. 12, have the freedom to structure their contracts, however, clauses that are unreasonable, arbitrary or contrary to public policy are not immune. If a clause in an insurance contract is unconstitutional, it is not enforceable. Primacy is given to a contract, but not above Fundamental Rights. E.23. The insurance policy in the present case, which has been issued to the Plaintiff, contains an exclusion qua genetic disorders, which was not based on any tests conducted on him or results thereof. It was a clause suddenly inserted in the year 2011, prior to which the Plaintiff had undergone treatment for the same medical condition, and for which his claim was sanctioned. Thus, it is clear that no advance intimation was given to the Plaintiff about the inclusion of this clause, nor was he put to notice of the same. The fine print of an insurance contract is not easily understandable by a layman, who operates primarily on the basis of trust and faith. Standard form contracts, especially insurance policies, do not provide a choice to the consumer whether to sign up or not. Under such circumstances, the principle of uberima fides applies, on the insurance companies and the insured, as held by the Supreme Court in Hanil Era Textiles Ltd v Oriental Insurance Co. Ltd & Ors (2001) 1 SCC 269.