In a significant ruling that underscores the rights of insurance policyholders, a consumer forum in Ahmedabad has directed The Oriental Insurance Company Limited to pay a mediclaim of Rs 5 lakh, along with interest and compensation. The forum found that the insurance company had wrongly rejected the claim on the grounds of a pre-existing disease without sufficient proof.
The Case and the Conciliation Attempt
The dispute dates back to 2019 when the Consumer Education and Research Centre (CERC) in Ahmedabad first took up the case. Before a formal complaint was lodged, CERC attempted to resolve the matter through conciliation. However, despite receiving notices from CERC, the insurance company failed to settle the dispute, which ultimately led to formal proceedings before the consumer commission.
Details of the Mediclaim Policy and Hospitalizations
The policyholder, Vanna Mahadevia, a resident of Ahmedabad, had a mediclaim policy with a sum insured of Rs 5 lakh. This policy was active from April 4, 2018, to April 3, 2019, and was a renewal of an earlier cover. During this period, her husband, Anil Mahadevia, was hospitalized three times between December 2018 and January 2019.
His medical admissions were for palpitations and uneasiness in December 2018, followed by treatment for cough and other urological issues in January 2019. The total medical expenditure for these three hospitalizations amounted to Rs 5.65 lakh. While the actual bills were higher, the complainant wisely limited her claim to the policy's maximum sum insured of Rs 5 lakh.
The Insurer's Grounds for Rejection and the Legal Fight
Oriental Insurance rejected all three claims, contending that Anil Mahadevia had hypertension, which it treated as a pre-existing condition. The insurer alleged that this condition was not disclosed at the time of purchasing or renewing the policy.
Advocate Shrijit Pillai, representing the complainant, argued forcefully against this rejection. He stated, "None of the hospital admissions had any medical link to hypertension, and there was no record to show that the condition had any relevance to the ailments for which the patient was treated." He further submitted that there was no evidence on record to establish suppression of any pre-existing disease.
The Consumer Forum's Verdict and Directives
The consumer commission carefully examined the arguments and evidence from both sides. In its observation, it noted critically that "the insurer failed to prove the existence of a pre-existing disease or its relevance to the treatment undergone." The forum also highlighted the complete absence of any medical evidence or expert opinion to support the insurer's stand.
Allowing the complaint in part, the commission issued a clear directive:
- Pay the sum insured of Rs 5 lakh to the complainant.
- Add interest on this amount at the rate of 7% per annum from April 4, 2022.
- Pay Rs 2,000 as compensation for mental agony and another Rs 2,000 towards litigation costs.
The insurer has been ordered to make this payment within 45 days of the order.
This ruling serves as a crucial reminder to insurance companies about the need for concrete evidence when denying claims based on pre-existing conditions. It reinforces the protection offered to consumers under India's consumer protection laws and provides relief to policyholders who face arbitrary claim rejections.
