Southwest Delhi Commission Holds Max Bupa Health Insurance Liable For Wrongful Repudiation Of Valid Claim Based On Unsubstantiated Pre-Existing Disease

Brief Facts:

The Complainant shifted her insurance policy to Max Bupa Health Insurance Company (“Insurance Company”) from New India Assurance Co. Ltd. She was assured by her agent that the continuity of her insurance coverage would remain unaffected. She subsequently renewed her Mediclaim policy with the Insurance Company paying consideration amounts of Rs. 16,704/- and Rs. 19,014/-. The policy covered her and her son for a total sum insured of Rs. 20 Lakh. Despite these renewals and payments, the Complainant claimed that the Insurance Company rejected her claim for medical expenses incurred amounting to Rs. 24,565/-, following her hospitalization at Holy Family Hospital for abdominal pain and bleeding.

The Complainant contended that she promptly informed the Insurance Company about her admission to seek cashless facility approval, which was denied by the Insurance Company. This forced her to self-finance her medical bills. Despite submitting all necessary documents, the Insurance Company allegedly rejected her claim citing Clause 4 (A) of the policy's terms and conditions, reasons for which were not communicated to her earlier. Dissatisfied with the rejection, the Complainant approached the District Consumer Disputes Redressal Commission-VII, Southwest Delhi (“District Commission”) and filed a consumer complaint against the insurance company.

The Insurance Company didn't appear before the District Commission for the proceedings.

Observations by the District Commission:

The District Commission noted that the Insurance Company rejected the Complainant's claim under clause 4 (A) of the policy terms, stating that she had failed to disclose a pre-existing condition of heavy bleeding, which allegedly existed for four to five years as per the submitted documents. However, upon reviewing the discharge summary, the District Commission noted that there was no history of heavy bleeding during her hospitalization. The admission notes indicated that her Last Menstrual Period (LMP) was on 09.09.2014, and she was admitted for Abnormal Uterine Bleeding (AUB) for hysteroscopy and D&C.

The District Commission held that the rejection of the claim based on undisclosed pre-existing conditions was unfounded, as there was no documented history of such a condition at the time of admission. Had the Complainant suffered from prolonged heavy bleeding as claimed by the Insurance Company, the District Commission held that it would have been noted by the attending medical staff during her hospitalization.

Therefore, the District Commission directed the Insurance Company to process and pay the Complainant's claim of Rs. 24,565/-. Furthermore, it was directed to pay a compensation of Rs. 20,000/- to the Complainant for the mental agony and distress caused due to the unjustified rejection of her claim. It was also directed to pay Rs. 5,000/- for the litigation costs.

Case Title: Dr Rashmi Mittal Vs Max Bupa Health Insurance Co. Ltd.

Case Number: CC/15/2