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Health Insurance Claim Procedures
(1) Health Insurance Claim Procedure   (2) Protect Your Interest
(3) Claim Form to be Sent to TPA   (4) Circumstances under which claims get Rejected
(5) Claims not Allowed - Some Case Studies   (6) Consumer Forum Cases in Health Insurance (Some Judgments)
6- Consumer Forum Cases in Health Insurance (Some Judgments)
1-Balwinder Singh Vs The New India Assurance Company Limited
Case: The wife of Balwinder Singh was involved in an accident and was admitted in Max Hospital, New Delhi. The death occurred and a claim was lodged with New India Assurance Company Limited towards payment of hospital claim bill (Mediclaim). Balwinder Singh was unable to submit original bills and he explained that original hospital bills are with Motor Vehicle Tribunals. The claim was rejected by Deepak Verma, deputy manager (operations) an official of New India Assurance Company Limited. Singh filed a complaint with the consumer forum alleging that the insurance company did not settle the Rs 1 lakh claim after he filed the requisite documents (photo copies) regarding the hospitalization of his wife. This was rebutted by the New India Insurance Company on grounds that the complainant "never provided the hospital bills in original and they only submitted duplicate copies of the bills." It termed the denial of claim on basis of non-submission of documents and denied the remaining allegations.
Judgment: The District consumer Disputes Redressal Forum (East) has asked the New India Assurance Company to pay Rs. 1 Lakh claim to its client. The forum also ordered a compensation of Rs. 40,000 to be paid by Deepak Verma deputy manager of the company. The Judgement said:
  1. Directing an insurance company to compensate its client, a district consumer forum has slammed insurance firms for rejecting claims “on one pretext or the other.”
  2. "The officer responsible for not acting judiciously and as per the rules need to be made personally liable and not the corporation. They are the custodian of the public money," said the order passed by president of forum N A Zaidi and member T Vijayan.
  3. "They cannot be allowed to burden the public money with interest which the company has to pay," the order further stated. Thus Deepak Verma, deputy manager (operations) in his personal capacity has been asked to compensate the client Balwinder Singh.
These points were noted by the bench which termed it as "unfair trade practice" by the company. It also remarked that they did not understand "how can the opposite party file this claim as no claim when it was within their knowledge that the original documents are on the file of the Motor Accidents Claims Tribunals (MACT) to which they were a party."
Implication: Persons working in claim departments of PSU’s will have to be careful with a new to avoid payment of penalty out of service.
2-Life Insurance Corporation of India Vs Haryana Consumer Disputes Commission
Case: There was undue delay in passing claim by LIC and the consumer had gone to Haryana Consumer Disputes Commission. Their Judgement was that claim be paid and concerned official should pay penalty out of his own pocket. LIC decided to take the case to National Consumer Disputes Redressal Commission in the form of revision petition. Their stand was that LIC is ready to pay penalty as a corporation/company and officer should not be compelled to pay out of his own salary/ pocket.
Judgment: National Consumer Disputes Redressal Commission disposed the petition and maintained that officer of LIC should pay penalty out of his own pocket. The Commission observed that there was ‘dereliction of duty’ by the LIC officers and instead of tackling the problem; it had challenged the state commission’s order.
Implication: You will be surprised to know that policy was for Rs. 1 Lakh only and case has been going on since 2004. It is a landmark Judgement and will be welcomed by consumers located all over the country. It will discoverage officials in claims department of Life/ Non Life/ Health Insurance Companies to go on rejecting claims.
3-Refusal to renew a policy amounts to unfair practice
In this case Biman Bose vs. United India Insurance Company the insurer had refused to renew mediclaim policy of Biman Bose and his wife Alka Bose . The plea of Biman Bose was that he was being victimised because of the case he had slapped on the insurer. The judgement of the Supreme Court was that the refusal to renew the policy was arbitrary and unfair. Company was fined and asked to reinstate policy.
This case answers questions or fear of many customers who feel –Will it be that in the event of a claim the insurance company will refuse to renew the policy.
4-Insurer shouldn’t take over 6 months to settle claim
In this case Kunti Devi had complained to IRDA that HDFC Standard Life had not settled claim even after 12 months. The stand of the company was that it was investigating the cause of death and will take some more time.
IRDA ruled that investigation should not take more than 6 months from the date of claim. Insurer was fined Rs 5 lakhs. With such cases we get the confidence that insurance companies will move towards settlement of the case within a reasonable time.
5-Shiv Kumar Gupta vs New India Assurance Co. Ltd.
A district consumer forum has ordered New India Assurance Co. Ltd. in May 2012 to pay a policy-holder Rs.60,000 for refusing to reimburse expenses incurred on hospitalization.
Shiv Kumar Gupta had spent Rs.45,252 on his son’s hospital stay in 2010. The district consumer disputes redressal forum has ordered the company to reimburse the amount and also pay Rs.10,000 as compensation for “harassment’ and “mental agony” and Rs.5,000 as litigation cost.
The insurance company refused to pay claiming Gupta had not provided all documents. Gupta informed the third party administrator of the company of his son’s hospitalization on December 7, 2010 and submitted documents. He was told his claim was being processed. The company later rejected it arguing that doctor’s prescription slip and IPD paper were missing.
“Despite the fact that the insurance company has received the policy premium when the benefits were required to be extended to the complaint / family members it closed the claim without valid reason,” said the forum.
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