“The opposite parties (Niva Bupa officials) cannot take shelter under vague medical links to restart waiting periods post-portability when continuous cover has been maintained without break since 2019,” the commission said on July 25. It held that the rejection of the claim amounted to “a clear deficiency in service and unfair trade practice” on the part of the opposite parties.
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The dispute arose after the insurer treated the woman’s ovarian cyst as a pre-existing disease and invoked a 36-month ‘waiting period’. The commission, however, found that she had been continuously insured since July 30, 2019, and that the policy had later been ported to the current insurer without a break in coverage.
Policy ported in 2022
According to the order, the woman was initially insured under a health insurance policy issued by Star Health and Allied Insurance Company Limited from 2019. The policy was ported to Niva Bupa in 2022 with full continuity benefits. It was then renewed regularly without any break. The relevant Family Floater policy was valid from July 30, 2024, to July 29, 2025.
In July 2024, the woman fell ill and was diagnosed with an ovarian cyst. She was admitted to the hospital from August 13 to August 14, 2024, and underwent surgery for removal of the cyst. The total expenditure incurred was Rs 2,30,124, including Rs 2,19,124 towards medical and surgical expenses and Rs 11,000 for an MRI scan.
Why insurer rejected claim
The woman submitted a reimbursement claim to the insurer after her treatment. The insurer rejected the claim through an email dated August 23, 2024. It invoked Clause 6.1(a) of the policy and treated the ovarian cyst as a pre-existing disease subject to a 36-month waiting period. The insurer linked the condition to an open hysterectomy surgery she had undergone in 2020.
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The insurer argued that portability did not automatically waive specific waiting periods if an ailment had pathological roots in a policyholder’s previous medical history. The company contended that the woman’s hysterectomy in 2020 had a pathological connection with the ovarian cyst and that the condition, hence, fell within the 36-month waiting-period exclusion under Clause 6.1(a).
It also argued that the five-year moratorium period under Insurance Regulatory and Development Authority of India (IRDAI) guidelines did not override specific exclusions in the policy.
‘Benefits to be carried forward’
The commission disagreed with the reasoning advanced by the insurer. It examined the regulatory provisions governing portability and observed that when a policyholder ports an existing health insurance policy to another insurer without a break in coverage, the new insurer must credit and carry forward waiting periods already served under the previous policy.
It noted that the woman had remained continuously insured from July 30, 2019. Her earlier open hysterectomy surgery had taken place in 2020, when she was covered under her initial Star Health policy. The policy was later ported to Niva Bupa on August 8, 2022, with continuity of cover from July 30, 2019. The commission held that this continuity was legally inherited by the current insurer.
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By July-August 2024, the woman had completed more than five years of continuous insurance coverage. “Consequently, invoking Clause 6.1(a) to impose a fresh 36-month waiting period for a condition purportedly linked to a 2020 event is legally unsustainable, arbitrary, and directly contrary to the statutory protection guaranteed under IRDAI Portability Guidelines,” the commission said.
It further held that any 36-month waiting period for pre-existing conditions had already expired before the treatment in August 2024. It said the insurer could not rely on “vague medical links” to restart waiting periods after portability when continuous cover had been maintained without a break since 2019. It held that the rejection of the claim amounted to deficiency in service and unfair trade practice.
Allowing the complaint, the commission directed the opposite parties to jointly and severally pay the woman the claim amount of Rs 2,30,124 with interest at 9 per cent per annum from the date of filing of the complaint until its actual realisation.
The forum also directed the opposite parties to pay the woman Rs 20,000 as compensation for mental agony, trauma and harassment. A further Rs 15,000 was awarded towards litigation costs.
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Takeaway
The ruling highlights that porting a health insurance policy without any break in coverage usually preserves the waiting periods already completed under the policy terms. An insurer generally cannot impose a fresh waiting period for a claim by linking it to an earlier medical condition when continuity benefits have been carried forward, the commission held in this case.
Aggrieved consumers may contact the consumer helpline in their respective states (Himachal Pradesh: 1800-180-8087) or call the National Consumer Helpline at 1915 for assistance.
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