Health insurance firm fined ₹75,000 for rejecting claim

The Consumer Disputes Redressal Commission has penalised a health insurance company for rejecting a cashless payment claim, citing non-disclosure of pre-existing disease

The Consumer Disputes Redressal Commission has penalised a health insurance company for rejecting a cashless payment claim, citing non-disclosure of pre-existing disease.

The Consumer Disputes Redressal Commission directed the health insurance firm to reimburse the entire claim amount along with 9% interest from the date of repudiation of the claim. (Representative image)

Harjinder Singh Sohal, a resident of Phase 2, Mohali, had submitted in a complaint that he took an international medical health insurance policy from Religare Health Insurance Company Limited on payment of ₹17,864. The sum insured under the policy was USD$50,000 and was valid for September 2018 to March 2019.

However, when in November 2018, the complainant submitted a claim for cashless benefit under the scheme for treatment in Australia, the firm rejected the cashless payment on the ground of non-disclosure of pre-existing disease, that is coronary artery disease (CAD) and dyslipidemia.

Due to rejection of the claim, the complainant had to pay the hospital’s bills worth AUD$31,499.

Allowing the complaint partly, the Consumer Disputes Redressal Commission directed the firm to reimburse the entire claim amount along with 9% interest from the date of repudiation of the claim.

“The firm will have to pay compensation of ₹50,000 to the complainant, for causing him mental agony, harassment and humiliation and also deficiency in providing service and adoption of unfair trade practice. The firm will also have to pay ₹25,000 to the complainant to pay the cost of litigation,” the commission said.

The commission further directed the firm to comply with the orders within 30 days, failing which the awarded amount shall be paid with 12% interest.