Mumbai Consumer Commission Orders Niva Bupa To Pay ₹66.50 Lakh For Wrongfully Denying Cancer Treatment Claim

Brief Facts of the Case:

The complainant, Shri Alok Rajendra Bector, was insured under Niva Bupa's Heartbeat–Family First Platinum Policy, which offered worldwide coverage with a sum insured of ₹65,00,000 and an annual premium of ₹72,622. During the first policy period (27.11.2017–26.11.2018), he was diagnosed with colorectal cancer on 1 August 2018 and underwent treatment in India, later planning further treatment in the USA. He informed the insurer and submitted his claims for treatment.

In December 2018, the insurer repudiated his claim of ₹20,47,343, alleging non-disclosure of asthma, and later cancelled the policy on 26.12.2019. The complainant challenged this before the Insurance Ombudsman, who set aside the cancellation and directed the insurer to reimburse ₹20,47,343, which the complainant received on 9 June 2020.

The complainant continued cancer treatment in the USA and renewed the policy. He later submitted reimbursement bills of ₹88,34,560 for overseas treatment at Memorial Sloan Kettering Cancer Center (USA). The insurer rejected the claim again, stating that foreign treatment was covered only on a cashless basis, not reimbursement.

With no relief after issuing a legal notice, the complainant filed this complaint seeking ₹66,50,000, along with interest, compensation, and litigation costs, alleging deficiency in service by the insurer.

Contentions of the Complaint:

The complainant argued that his policy provided worldwide specified-illness coverage, and he had duly informed the insurer about his cancer diagnosis and overseas treatment. Despite this, the insurer unjustly rejected his USA treatment claim of ₹88,34,560, even after the Insurance Ombudsman had already ruled in his favour in the earlier claim dispute. He contended that the insurer's repeated refusals during critical cancer treatment amounted to clear deficiency in service, and he sought ₹66,50,000, interest, compensation, and costs.

Contentions of the Insurance Company:

Niva Bupa argued that overseas cancer treatment was covered only on a cashless basis, not through reimbursement, and the complainant underwent treatment in the USA without completing the required pre-authorization process. They also claimed non-disclosure of asthma and maintained that the rejection of the reimbursement claim was as per policy terms. The insurer denied any deficiency and sought dismissal of the complaint.

Observation and Decision of the Commission:

The Commission observed that the insurer had earlier wrongfully cancelled the complainant's policy on the ground of non-disclosure of asthma—an action already overturned by the Insurance Ombudsman, who ordered reimbursement of ₹20,47,343. This established that the insurer's cancellation was unjustified and unrelated to the complainant's colorectal cancer treatment.

The Commission further held that because the insurer itself cancelled the policy, the complainant could not obtain cashless authorization for overseas treatment. Therefore, the company could not rely on the “cashless only” clause to reject the complainant's USA treatment claim of ₹88,34,560. The Commission found that the insurer's repeated refusals amounted to clear deficiency in service and unfair trade practice, particularly during a life-threatening illness.

The Commission directed Niva Bupa to:

Pay ₹66,50,000 (Sixty-Six Lakh Fifty Thousand Rupees) as the approved claim amount.

Amount must be paid within 60 days.

If not paid within 60 days, the insurer must pay interest @ 6% per annum on ₹66,50,000 from the date of the order until realization.

Compensation:

• ₹30,000 for mental agony and harassment.
• ₹10,000 towards legal expenses.

Case Title: Alok Rajendra Bector vs. Niva Bupa Health Insurance Company Ltd.

Case No.: CC/292/2022

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