7 Sep 2023 11:00 AM GMT
Recently, the Hyderabad District Consumer Disputes Redressal Commission–II bench comprising of Vakkanti Narasimha Rao (President), Jawahar Babu (Member) and Madhavi Sasanakota (Member) held Manipal Cigma Health Insurance Company liable for deficiency in service for repudiating the complainant's genuine claim. The Company failed to present the actual proposal form filled by...
Recently, the Hyderabad District Consumer Disputes Redressal Commission–II bench comprising of Vakkanti Narasimha Rao (President), Jawahar Babu (Member) and Madhavi Sasanakota (Member) held Manipal Cigma Health Insurance Company liable for deficiency in service for repudiating the complainant's genuine claim. The Company failed to present the actual proposal form filled by the complainant which was crucial in determining whether the complainant had indeed failed to disclose his medical history, as claimed by the insurance company.
Brief Facts of the Case:
C. Pratap Reddy (“Complainant”) had a health insurance policy with Manipal Cigna Prohealth Group Insurance Company (“Insurance Company”). He underwent medical treatment at AIG Hospitals, Hyderabad (“Hospital”), for an ailment related to the ascending colon. The complainant requested a cashless claim under his health insurance policy, but the insurance company repudiated the claim on the grounds that he had not disclosed a history of open appendectomy in the proposal form. The complainant alleged that the rejection of his claim was unjust and caused him mental agony and financial stress. Aggrieved, the complainant filed a consumer complaint in the Hyderabad District Consumer Disputes Redressal Commission-II (“District Commission”).
The Insurance Company contended that the complainant failed to disclose his history of open appendectomy in the proposal form, which was material information affecting the policy decision. They argued that the complainant's failure to disclose the appendectomy history constituted a violation of the "Duty of Disclosure" clause in the policy terms and conditions. It was claimed that the complainant's non-disclosure of material information justified the repudiation of the claim under the terms of the policy.
Another company named Medi Assist Insurance TPA Pvt. Ltd. was also marked as the opposite party in the complaint. In its defence, it argued that it had processed the claim based on the information and documents provided by the complainant and the hospital. Furthermore, their role was limited to claim processing and they were not responsible for policy-related decisions.
Observations of the Commission:
Firstly, the District Commission noted the absence of the actual proposal form filled by the complainant, which was in the custody of the insurance company. This proposal form was crucial in determining whether the complainant had indeed failed to disclose his medical history, as claimed by the insurance company. The District Commission observed that the burden of proof was on the insurance company to establish beyond reasonable doubt that the complainant had not disclosed the relevant medical history.
The District Commission further highlighted that the insurance company's denial of the claim had caused the complainant significant mental agony and financial stress, especially given the rejection occurred during his hospitalization. The complainant had argued that his medical history of appendectomy was unrelated to the ailment for which he sought the insurance claim.
Considering these factors, the District Commission found that the insurance company's denial of the claim based on non-disclosure was not substantiated beyond reasonable doubt, as the proposal form was not presented as evidence. The District Commission also observed that the non-disclosed medical history did not seem directly relevant to the ailment in question.
In light of these findings, the District Commission held that there was glaring negligence and deficiency of service on the part of the insurance company in repudiating the complainant's genuine claim. The insurance company's actions were considered an unfair trade practice and were deemed unjust. However, the District Commission dismissed the claims against Medi Assist Insurance TPA Pvt Ltd, as it had a limited role in claim processing and was not responsible for policy-related decisions.
The District Commission ordered the Insurance Company to pay the complainant Rs. 6,47,000 towards medical expenses incurred, along with interest. Additionally, the insurance company was directed to pay compensation of Rs. 50,000 for mental agony and Rs. 10,000 for costs of litigation.
Case: C. Pratap Reddy vs M/s Manipal Cigma Health Insurance Company Ltd.
Case No.: Consumer Case No.808/2022
Advocate for the Appellant: Uma Sankar
Advocate for the Respondent: V. R. Suresh
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