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Chandigarh: Insurer fined ₹40,000 for rejecting elderly man’s mediclaim
Care Health Insurance Limited, Chandigarh, has been directed to refund over ₹22 lakh paid for medical bills and also pay ₹40,000 as compensation for causing mental agony and harassment, and as costs of litigation
The District Consumer Disputes Redressal Commission, Chandigarh, has penalised an insurance company for not settling the medical claims of an elderly man from Moga.
Care Health Insurance Limited, Chandigarh, has been directed to refund over ₹22 lakh paid for medical bills and also pay ₹40,000 as compensation for causing mental agony and harassment, and as costs of litigation.
Complainant Sarwan Singh Masoun, 80, who died during the pendency of the consumer complaint, had obtained an insurance policy from the firm for December 2021 to 2022, covering the risk of 1 lakh USD each for himself and his wife, Manjit Kaur Masoun.
On December 5, 2021, the elderly couple travelled to Canada. During their stay there, the complainant suffered from various ailments and was hospitalised on different dates. He had submitted medical bills from time-to-time, along with the claim forms, to the insurance company. However, the claims were denied in April 2022 on the grounds of pre-existing disease and non-disclosure of material facts by the insured patient.
Following this, his legal representatives, including his wife, who is now living in Canada, and their foreign-based sons Dr Navdeep Singh and Amardeep Singh filed a complaint against the insurer, insurance ombudsman, the manager based in Gurgaon and the authorised representative, Falck Global Assistance through the insurance company.
As per the complaint, a month after reaching Canada, Sarwan fell ill and spent ₹1,55,569 on diagnosis. He again fell ill and was diagnosed with acute kidney injury and remained hospitalised till March 19, 2022, where he ended up spending ₹7,47,820, and in May 2022, Sarwan was again hospitalised. At last, he was flown back to India, as treatment was expensive and the company rejected multiple claims.
Terming it illegal, the elderly man moved a consumer complaint. The insurance company resisted the consumer complaint and stated the claim was rejected in April 2022 on the grounds of misrepresentation, misdescription and non-disclosure of material facts by Sarwan at the time of obtaining the subject policy.
The insurance ombudsman submitted that it is not an interested party as it had carried out its duties as per rules and prayed for the deletion of its name.
The commission observed that when the policy was bought by the complainant on December 2, 2021, that is after 60 months of the previous treatment taken in 2016, it is safe to hold that the denial of the claim on the grounds of non-disclosure of material facts qua pre-existing disease is against the terms and conditions of the subject policy, and is illegal and arbitrary.
Hence, the commission directed the opposition parties (except the ombudsman) to pay ₹22,60,020 to the complainants, along with interest at 9% per annum from the date of denial of the claim, which is April 8, 2022.
