18th day of December 2024
CC 8/23 filed on 04/01/2023
Complainant : Raju Peeter, S/o. Peeter, Pallipurathukaran House,
Nadavarambu Desom. Veluukkara Village,
Mukundapuram Taluk, Nadavarambu P.O.,
Pin – 680 661.
(By Adv. K. Jagadeesh, Irinjalakuda)
Opposite Party : The Manager, National Insurance Co. Ltd.,
Irinjalakuda Branch, First Floor, Maliyekkal
Building, Main Road Irinjalakuda, Pin – 680 121.
(Ex-parte)
F I N A L O R D E R
By Sri. C.T. Sabu, President:
1. The facts of the case in brief are as follows:
The complainant had taken a medical insurance policy (Policy No. 570701502110001202) from the opposite party for himself and his family, with a sum insured of ₹7,00,000/- (Rupees seven lakh only) for the period from 24/02/2022 to 23/02/2023, covering treatment for any disease during the policy tenure. On 11/07/2022, the complainant underwent a full endoscopic discectomy at Apollo Adlux Hospital and received ₹1,39,986/- (Rupees one lakh thirty nine thousand nine hundred and eighty six only) as a claim. He was hospitalized again on 16/08/2022 and incurred ₹41,262/- (Rupees forty one thousand two hundred and sixty two only), which was reimbursed. On 17/09/2022, the complainant underwent a laminectomy at Aster MIMS Hospital, Kozhikode, incurring a total expense of ₹2,07,527.08/- (Rupees two lakh seven thousand five hundred and twenty seven and eight paise only), out of which only ₹1,01,252.08/- (Rupees one lakh one thousand two hundred and fifty two and eight paise only) was reimbursed by the insurer, leaving ₹1,06,275/- (Rupees one lakh six thousand two hundred and seventy five only) unpaid. Additionally, the complainant had to pay ₹3,473.78/- (Rupees three thousand four hundred and seventy three and seventy eighty paise only) towards registration, lab tests, consultation, and medicines. The complainant claimed reimbursement for these unpaid amounts, but the opposite party rejected the claim, stating that the sum insured of ₹2,82,500/- (Rupees two lakh eighty two thousand and five hundred only) (as recalculated by them) had been exhausted, which contradicts the policy's stated coverage of ₹7,00,000/- (Rupees seven lakh only). The complainant alleges that this rejection constitutes a deficiency in service and an unfair trade practice. Despite sending a legal notice on 11/11/2022 demanding payment, the opposite party neither replied nor paid the amount, prompting the complainant to file this complaint.
2. On receiving the complaint, proper notice was sent to the opposite parties. The opposite parties neither appeared before the Commission nor filed a version. Hence, the opposite parties were set as ex-parte, and the case was posted for the complainant's evidence.
3. When the case came for evidence, the complainant filed a proof affidavit in which he affirmed and explained all the averments in tune with the complaint. The complainant produced eight documents marked as Exts. A1 to A8. Ext. A1 is the Insurance Policy in the name of the complainant. Ext. A2 is the Bills given to the opposite party. Ext. A3 is the Discharge Summary dated 23/09/2022. Ext. A4 is the Application given by the complainant to the opposite party dated 10/10/2022. Ext. A5 is the Letter dated 21/10/2022 issued by the Heritage Health Insurance Company to the complainant. Ext. A6 is the copy of the Notice send by the complainant to the opposite party dated 11/11/2022. Ext. A7 is the Postal Receipt. Ext. A8 is the Postal Acknowledgement Card dated 14/11/2022.
4. This complaint is filed by the complainant against the opposite party regarding the rejection of a medical insurance claim. Ext. A1 is the original insurance policy, which establishes that the complainant had a coverage limit of ₹7,00,000/- (Rupees seven lakh only) for the period from 24/02/2022 to 23/02/2023. The policy clearly stipulates that the insured is entitled to claim reimbursement for hospitalization expenses incurred during the policy period, subject to the policy's terms and conditions. Ext. A2 includes the medical bills, which confirm that the complainant incurred ₹1,06,275/- (Rupees one lakh six thousand two hundred and seventy five only) from his own pocket for treatment. The discharge summary dated 23/09/2022, marked as Ext. A3 corroborates the treatment details and hospitalization expenses. Ext. A4 and Ext. A5 reflect the complainant's claim for reimbursement and the subsequent rejection of the claim by the opposite party, purportedly on the grounds that the sum insured under the policy was exhausted. Ext. A6 is the lawyer's notice sent to the opposite party, Ext. A7 is the postal receipt and Ext. A8 is the acknowledgment card, confirming the notice was duly served.
The opposite party neither appeared before this Hon'ble Commission nor adduced any evidence in their defence. It is evident from the policy document (Ext. A1) that the coverage limit was ₹7,00,000/- (Rupees seven lakh only), which was not fully utilized as the claims submitted by the complainant were well within this amount. The opposite party's reasoning that the sum insured had been exhausted based on separate terms and conditions is vague and unsupported by the policy's stated coverage. This explanation lacks clarity and transparency, as the opposite party failed to produce any evidence or policy clause justifying the rejection. Offering a basic coverage amount and subsequently denying legitimate claims based on separate, undisclosed terms and conditions without explanation constitutes a clear deficiency in service.
A medical insurance policy is meant to indemnify the insured for hospitalization expenses, and denying reimbursement for expenses that fall within the stated coverage defeats the purpose of the policy. This action caused the complainant significant financial hardship and mental agony, who had to bear the burden of the rejected expenses. The facts and evidence presented, including the complainant's compliance with the policy terms and submission of supporting documentation, leave no ground for the rejection of the claim.
Further, the opposite parties had not cared to enter an appearance or file the written version before the Commission even after receiving the Commission's notice. The opposite parties' conscious failure to submit their written version amounts to an admission of allegations levelled against them by the complainant. The Hon'ble National Commission expressed the same view in its order dtd. 09/10/2014 in RP 579/2017 /2017 (4) CPR 5901. The act of the opposite parties certainly tantamount to deficiency in service and unfair trade practice, and we are inclined to allow this complaint.
5. In the result, the complaint is allowed, and the opposite party is directed to
pay the complainant:
a. ₹1,06,275/- (Rupees one lakh six thousand two hundred and seventy five
only), along with interest at 12% per annum from the date of submission of
the claim until realization.
b. ₹10,000/- (Rupees ten thousand only) as compensation for the mental agony
and financial inconvenience caused to the complainant.
c. ₹5,000/- (Rupees five thousand only) towards the costs of litigation.
The order shall be complied within one month of receiving the copy of this order, failing which, the complainant is entitled to an additional 12% interest per annum for the sum towards compensation and cost as well till realization from the date of the order.
Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the open Commission this the 18th day of December 2024.
Sd/- Sd/- Sd/-
Sreeja S. Ram Mohan R C. T. Sabu
Member Member President
Appendix
Complainant’s Exhibits :
Ext. A1 is the Insurance Policy in the name of the complainant.
Ext. A2 is the Bills given to the opposite party.
Ext. A3 is the Discharge Summary dated 23/09/2022.
Ext. A4 is the Application given by the complainant to the opposite party dated 10/10/2022.
Ext. A5 is the Letter dated 21/10/2022 issued by the Heritage Health Insurance Company to the complainant.
Ext. A6 is the copy of the Notice send by the complainant to the opposite party dated 11/11/2022.
Ext. A7 is the Postal Receipt.
Ext. A8 is the Postal Acknowledgement Card dated 14/11/2022.
Opposite Parties’ Exhibits:
Nil
Id/-
C.T. Sabu
President
