Times of India
23 July 2010
By Rebecca Samervel
Mumbai, India

In yet another blow to nit–picking insurance companies who reject policy–holders’ claims on technical grounds, a district consumer forum has decreed that a cardiac patient’s insurance claim cannot be denied even if they did not previously list hypertension and diabetes as existing ailments.

The forum has asked the insurer to honour the claim and pay Rs 5,000 as compensation. In 2003, Mulund’s Karunakar Shetty underwent a coronary artery bypass grafting surgery and ran up a bill of Rs 2,53,553. Shetty had taken a policy in 2000 for Rs 3 lakh, which was reduced to Rs 1.5 lakh after renewal in 2002 and 2003. In November 2003, Raksha TPA said his claim had been rejected as he had hypertension before he took the policy, and had hidden this from the insurer. UNKIND CUT ‘Diabetes is not a pre–existing disease’

Mumbai: Mulund–based Karunakar Shetty underwent a coronary bypass in 2003, and intimated the Oriental Insurance Company Ltd Co and third–party administrator Raksha TPA of this on July 17, 2003. However, Raksha TPA told him his claim had been rejected as he suffered from hypertension before taking the policy, in 2000, and had concealed his condition.

Shetty contended that he did not suffer from hypertension before he took the policy and even sent the discharge card from P D Hinduja Hospital and a statement from his family doctor to the insurance company to support this. But the company did not reconsider its decision and Shetty filed a complaint with a district consumer forum citing deficiency in service. The insurer has now been asked to pay up the claim amount, as well as Rs 5,000 extra as compensation for mental agony.

“In a large number of cases, diseases like hypertension and diabetes are so common and are always controllable...unless a patient undergoes a long treatment, including hospitalisation and undergoes operation in the near proximity of taking the policy (sic), (they) cannot be accused of concealment of facts,” the forum said.

The insurance company denied Shetty’s allegations and stated that in 2003, while renewing the policy, in the proposal form, Shetty wrote that he did not suffer from any pre–existing disease. It stated that when the papers were submitted, the third–party authority procured documents from a hospital that said Shetty had told them he had been suffering from diabetes for four years.

The insurance company alleged that the statement submitted by the family doctor was false and argued that the heart ailment that Shetty suffered from was closely related to diabetes and was not covered under the policy.

While passing its order, the forum took into account the hospital discharge card that Shetty had submitted following his treatment for left cerebeller hemisphere infarct in July 2002. From the discharge card and the report submitted by the family doctor, it was evident that Shetty was suffering from hypertension and diabetes and had discovered this only in 2002. The forum, however, refused to consider the hospital report submitted by the insurer stating that the report did not mention who had ascertained Shetty’s medical history.

The forum observed that Shetty was unaware of the disease when he took the policy in 2000 and, even if he did not mention it in 2003 while renewing the policy, hypertension and diabetes could not be called “pre–existing diseases”.

The forum then directed the insurance company and Raksha TPA to jointly or individually pay Shetty Rs 1.5 lakh (the insurance amount) with an interest of 6% applicable from November 2003. In addition, the ‘harassed’ policy–holder would also receive Rs 5,000 for mental agony and the litigation costs he incurred, the forum said.