Thrissur Consumer Commission Holds Oriental Insurance Guilty of Unjustified Claim Repudiation; Orders Reimbursement and Compensation
Pranav B Prem
The Thrissur Consumer Disputes Redressal Commission, comprising C.T. Sabu (President), Sreeja S. (Member) and Ram Mohan R. (Member), has held Oriental Insurance Co. Ltd. liable for unjustifiably repudiating a health insurance claim filed by a policyholder. The Commission found that the insurer rejected the claim based on a misinterpretation of the exclusion clause of the policy and without any valid medical basis.
The complainant had taken a health insurance policy from Oriental Insurance. On 15 December 2018, he was admitted to Jubilee Mission Medical College and Research Institute, Thrissur, for treatment of Intervertebral Disc Prolapse at L1/L2 and L2/L3. He was discharged the next day after undergoing conservative treatment for the diagnosed condition. After submitting a claim seeking reimbursement of medical expenses, the complainant found that the insurer repudiated the claim. Despite issuing a legal notice, no response was received, leading him to file a consumer complaint seeking reimbursement of ₹8,530 and other reliefs.
The insurer admitted the issuance of the policy and the filing of the claim. However, it argued that the actual hospital expenses were only ₹3,530 and that the complainant’s admission to the hospital was not medically necessary. It contended that the treatment amounted only to evaluation and that the claim was therefore barred under the exclusion clause relating to expenses for diagnostic or evaluative procedures. On this basis, the insurer sought to justify its repudiation of the claim.
The Commission examined the discharge summary, which clearly showed that the complainant was diagnosed with IVDP and underwent conservative treatment during his admission. The Bench noted that the decision to admit a patient rests solely with the treating doctor, and neither the insurer nor its officers possess the medical expertise to second-guess such decisions. It observed that the repudiation letter issued by Oriental Insurance wrongly treated the hospitalization as mere evaluation, without any medical evidence to support such a conclusion.
The Commission held that the insurer’s reliance on the exclusion clause was misplaced since the complainant had been admitted for proper medical treatment. It concluded that the repudiation was “unfounded and bad in law”, amounting to clear deficiency in service.
Regarding the claim amount, the Commission noted that the hospital bill totaled ₹3,530 and that the complainant had not rebutted this figure. Accordingly, the Commission granted reimbursement of ₹3,530 instead of the claimed ₹8,530. The complaint was partly allowed. The Commission directed Oriental Insurance to pay the complainant ₹3,530 towards medical reimbursement, ₹10,000 as compensation for mental agony, hardship and financial loss, and ₹10,000 as litigation costs.
Appearance
For Complainant: Adv. A.D. Benny
For Respondents: Adv. M. Sankaran
Cause Title: Sunil Kumar vs Manager, Oriental Insurance Co. Ltd.
Case No: CC/137/2019
Coram: C.T. Sabu (President), Sreeja S. (Member), Ram Mohan R. (Member)
