Menstrual Bleeding Is Not a Pre-Existing Disease: Malappuram Consumer Commission Holds Star Health Liable for Unjust Insurance Claim Denial
Pranav B Prem
In a detailed and significant ruling, the District Consumer Disputes Redressal Commission, Malappuram, comprising Sri. Mohandasan K. (President), Smt. Preethi Sivaraman C. (Member), and Sri. Mohamed Ismayil C.V. (Member), held Star Health & Allied Insurance Company Limited liable for deficiency in service and unfair trade practice. The Commission found that denying an insurance claim based solely on a single outpatient consultation for bleeding prior to the commencement of the policy was both unreasonable and unjustified. The Commission emphasized that menstrual bleeding is a natural biological process and not a disease requiring mandatory disclosure in insurance proposals.
Factual Background
The complainant, T.T. Subramaniyan, had taken a Family Health Optima insurance policy from Star Health & Allied Insurance Company Ltd. on 09.10.2020, covering his wife Smt. Padmaja and their children. The sum insured under the policy was ₹4,00,000, with an annual premium of ₹14,989, which was paid and renewed regularly until 2023.
On 25.06.2023, Smt. Padmaja was admitted to NIMS Hospital, Malappuram. Based on her medical condition and documents submitted by the hospital, the insurance company initially authorized a provisional amount of ₹18,167 for cashless hospitalization. This was later enhanced to ₹1,07,027 following further documentation and a discharge summary showing that the patient had undergone a laparoscopic left salpingo-oophorectomy under general anaesthesia on 02.07.2023. She was diagnosed with left tubo-ovarian mass with abscess, urinary tract infection, and Type II diabetes mellitus.
However, despite the approval, the insurer subsequently withdrew the authorization on 06.07.2023. The reason cited was a previous outpatient consultation on 02.01.2018 at the same hospital, where Smt. Padmaja had complained of bleeding. The insurer classified this as a case of “abnormal uterine bleeding” (AUB), which it claimed was a pre-existing condition that had not been disclosed in the proposal form and thus triggered exclusion clauses in the policy.
Complainant’s Contentions
The complainant stated that the insurance policy had been taken based on representations and assurances by the second opposite party (the insurance agent), including the promise of full annual coverage up to ₹4,00,000. He asserted that neither he nor his wife was subjected to any medical check-up prior to issuance of the policy.
He further argued that the denial of the insurance claim was arbitrary and based on a misconstrued interpretation of a routine consultation for menstrual bleeding in 2018, which did not amount to any disease requiring disclosure. The complainant also pointed out that the policy was renewed continuously for three years without any issues, and no treatment had occurred between 2018 and the date of hospitalization in 2023.
Opposite Parties’ Defense
The first and third opposite parties (the insurance company and its agent) filed a joint version stating that the policy was issued in accordance with the terms and conditions. They emphasized that the proposal form was the basis of the insurance contract and that it included a declaration by Smt. Padmaja stating she had no pre-existing illness.
They contended that the 2018 prescription indicating abnormal bleeding should have been disclosed, and failure to do so constituted suppression of material facts. Accordingly, they relied on clause 3(1) of the policy, which excludes coverage for pre-existing conditions and their complications for a period of 48 months from the inception of the policy.
They also cited clause 13 of the authorization terms, which allows the insurer to withdraw pre-authorization if discrepancies are found in the medical documents. The repudiation letter dated 29.07.2023 was also produced in support of this defense.
The second opposite party, the agent, denied personal liability and stated that he merely canvassed the insurance policy and explained the terms, which were accepted voluntarily by the complainant.
Findings and Observations by the Commission
The Commission closely examined all documentary evidence, including the insurance policy (Ext. A1), discharge summary (Ext. A2), approval and withdrawal letters (Ext. A3 and A4), and the outpatient prescription from 2018 (Ext. B4). It noted that the only record the insurer relied upon was a single prescription that mentioned a complaint of “bleeding,” without any accompanying diagnosis or further treatment.
The Commission observed: “It appears that Smt. Padmaja is aged 42 years and she was consulted by a doctor with a complaint of bleeding. No further details are available from B4 document. But the fact remains that bleeding issue of a female, that too aged only 42 years, cannot be treated as an ailment as contended by the opposite party. Rather, it is a natural biological process of a woman.”
The Commission further noted that there was no evidence of any continuous treatment or hospitalization between 2018 and the date of the policy in 2020. It found that: “It is not expected to disclose the bleeding as a disease while incepting an insurance policy… The Commission finds the consultation as per Ext. B4 during the year 2018 is not an ailment to be disclosed.”
Importantly, the Commission emphasized that the insurer had already approved the claim and only withdrew it at a later stage. This caused significant inconvenience to the complainant, who had undergone treatment relying on the initial approval. The Commission held this to be an unfair trade practice and deficiency in service.
Verdict and Directions
Holding the first opposite party liable, the Commission allowed the complaint and issued the following directions:
The insurer was directed to pay ₹1,07,027 to the complainant as the approved insurance claim.
An additional amount of ₹50,000 was awarded as compensation for the inconvenience, hardship, and deficiency in service.
₹10,000 was awarded as costs of the proceedings.
The Commission further directed that the order must be complied with within one month, failing which the complainant would be entitled to interest at the rate of 12% per annum from the date of the order until the date of payment.
Appearance
For the Complainant: Adv. O. Priyanka Baiju
For the Opposite Parties: Adv. Mohan George, Adv. Arun Gopal
Cause Title: T.T.Subramaniyan V. Star Health & Allied Insurance Company Limited & Ors.
Case No: C.C.NO.361/2023
Coram: Shri. Mohandasan. K [President], Smt Preethi Sivaraman.C [Member], Shri. Mohamed Ismayil.C.V [Member]
[Read/Download order]
