Insurance firms only interested in earning premiums, declining claims’: Consumer commission

The complainant (Nimesh Lata) died on May 27, 2023, during the pendency of the complaint and her son Dheeraj Chandan being her only legal representative was impleaded in her place.

The son stated that in December 2020 there was sudden pain in her (Nimesh Lata ) left arm which was coupled with swelling.

Subsequently, she was diagnosed with malignant neoplasm of nipple and areola, left female breast lump at PGIMER, Chandigarh, as per report dated January 14, 2021. She took treatment for the same from different hospitals – Vijayanand, Polo, Ivy Hospital, Mohali, and PGIMER, Chandigarh. She then submitted a claim of Rs 1,26,956 for reimbursement with documents which was rejected by the insurance company on the ground that the mammography report of the complainant shows that the said disease had a history of past 10 months which is prior to the policy and as such the case of the complainant is not covered under the policy.

Manipal Cigna Health Insurance Company in reply submitted that at the time of taking the policy the complainant had disclosed that she was not suffering from any pre-existing disease/illness, but upon receipt of the insurance claim, the said disclosure statement was found to be false and incorrect as the complainant was having some existing medical conditions such as “diabetes mellitus type-2” for years and was on regular medication of “Meformin 500”, and breast lumps since 10 months with effect from January 14, 2021, (mammography report date) which is prior to the policy inspection. However, the complainant had concealed the said facts at the time of taking the policy and therefore, the claim of the complainant was rightly repudiated as per the terms and conditions of the policy.

The commission after hearing the matter held that the insurance company “has not led any evidence that the disease of breast cancer had any connection or nexus with the diabetes mellitus type-2. In the absence of any evidence of nexus with diabetes mellitus type-2, the claim for treatment of the breast cancer cannot be said to have been rightly repudiated on the ground of non-disclosure of the material facts by the policy holder”.

The commission said that the disease for which the complainant had taken the treatment was covered under “Manipal Cigna Pro Health Protect V3-Non Floater Policy” and the complainant was diagnosed with breast cancer only on January 14, 2021, and on January 22, 2021, when the mammography test and other tests were conducted at the PGIMER, Chandigarh. Even the doctors of the PGIMER, Chandigarh, were not sure that the complainant was suffering from malignancy or not. As such it cannot be said that the complainant had any prior knowledge about her disease and she had concealed any material fact regarding her health at the time of obtaining the insurance policy.

The commission said that it is usual with the insurance company to show all’s well to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sorts of excuses to deny the claim.

“It seems that the insurance companies are only interested in earning the premiums and finding ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy. The insurance companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy,” held the commission in the order.

Thus, finding that the insurance company illegally rejected the genuine claim of the complainant, it directed it (firm) to pay Rs 4,34,435 towards the medical expenses to the complainant.