The Delhi state consumer commission has observed that claimants are made to run from pillar to post to get medical reimbursement from insurance companies and it would be "extremely tenuous" to expect a layman to read each and every clause of an insurance document before signing it. On most occasions, a person who intends to obtain insurance has no choice to say no to a clause in an insurance policy, the commission said. It said medical insurance is primarily obtained for the purpose of unforeseen medical conditions and so long as there has been no fraud at the time of obtaining insurance, policies ought to be honoured. The commission's observations came when directing HDFC Standard Life Insurance Corporation Ltd to allow a claim of Rs 50 lakh, which was rejected by the company on the grounds of pre-existing diseases and non-furnishing of occupation details by the claimant.
The complainant Faridabad resident Virpal Nagar, brother of the deceased Pratap Singh had accused the firm of resorting to unfair trade practice and deficiency of service. According to the complaint, Singh had taken an HDFC term insurance policy of Rs 50 lakh on December 5, 2008 for a term period of 20 years. After Singh's death in 2009, his nominee Nagar filed a claim with the insurance firm. However, the firm rejected the claim on April 19, 2010, citing grounds such as non-disclosure of asthma and paralysis Singh was suffering from before filing up the application and regarding details about his occupation. The commission's member Anil Srivastava said he is of the view that the grounds to reject the claim "cannot sustain".
"It would be extremely tenuous to expect a layman to read each and every clause of an insurance document before signing it... It is usual to see claimants running from pillar to post in order to get medical reimbursement from insurance companies. This case is no different," it said. "...The complaint deserves to be accepted and the grounds taken by the OPs (opposite party) since not sustainable are sequentially rejected. The core question that remains to be answered is as to how the complaint can be compensated for the harassment caused to him at the hands of the OPs," Srivastava said. The commission asked the firm to allow the policy claim within two months to Nagar.
The commission referred to one of its previous orders in which it had said that any disease for which one has never been hospitalised or undergone operation is not a pre-existing disease. "If a person conceals the factum of his hospitalisation for a particular disease or operation undergone by him in the near proximity of obtaining the insurance policy, only then it can be termed a concealment of factum of disease," the tribunal said.