Failure to pay policyholders has proved costly for Star India Health Insurance and Aditya Birla Health Insurance Company, which provide mediclaim services. The District Consumer Disputes Redressal Commission has ordered the insurance companies to pay the deducted amount along with interest and also imposed a fine. Lalji Tiwari, Judicial Member of Indore District Consumer Disputes Redressal Commission-2, stated that two separate cases involving the insurance companies came before the Commission.
Case 1: 50 lakh rupees refused to be paid, now required to be paid with interest
Sandeep Harod, a resident of village Harsola, Tehsil Mhow, filed a complaint. He alleged that he had purchased accident insurance for his mother, Sushilabai, for 50 lakh rupees from Aditya Birla Health Insurance Company, covering her for three years. His mother died in an accident on November 16, 2019, and he filed a claim against her. After the death within eight months of the insurance, the company conducted an investigation. Other insurance companies had previously rejected claims due to the discrepancy between his mother’s income and occupation. On the same basis, Aditya Birla Health Insurance Company also rejected his claim.
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The Commission, declaring this decision erroneous, ordered the payment of ₹50 lakh to the complainant, along with 6% interest from November 20, 2020, until the date of payment. Additionally, ₹50,000 will be paid for the inconvenience and mental harm caused to the complainant, and ₹25,000 will be paid separately as litigation expenses.
Case 2: COVID-19 treatment expenses must be paid
New Palasia resident Kamya Jaiswani filed a complaint. She stated that she had taken out a mediclaim policy with Star Health & Allied Insurance Company, which provided coverage of ₹40 lakh. In April 2021, she contracted COVID-19. After treatment at a hospital in Indore, she was airlifted to Hyderabad. She claimed ₹6.75 lakh for the Indore hospital and ₹47.82 lakh for the Hyderabad hospital. However, the company deducted ₹1.87 lakh from the Indore treatment expenses and ₹24.86 lakh from the Hyderabad treatment expenses. The matter even reached the Insurance Ombudsman, but she did not receive her payments.
During the hearing, the insurance company stated that it had paid the amount in accordance with the company’s terms and conditions. The Commission’s Chairman, Vikas Rai, and two judicial members, found this to be incorrect and ordered the insurance company to pay Rs 8,28,831. Simple interest at an annual rate of 8% will also be paid until the payment is made.
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