The Hindu : Andhra Pradesh / Hyderabad News : Insurance firm told to pay compensation

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Monday, Sep 08, 2008
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Andhra Pradesh

Andhra Pradesh - Hyderabad

Insurance firm told to pay compensation

Staff Reporter

Natural ailment unknown at the time of insurance qualifies for compensation

HYDERABAD: Does a natural ailment that was unknown at the time of insurance qualify for compensation? The answer is yes, according to a verdict of the A.P. State Consumer Disputes Redressal Commission.

Disposing an appeal by National Insurance Company Ltd. against T. Sujatha and Heritage Health Services (P) Ltd., the commission averred that the insurance firm should abide by the policy if it was issued after satisfying with the client’s health condition.

T. Sujatha had taken a Mediclaim Insurance Policy of Rs.1 lakh for herself and her son Sai Lalitha Prasad. The policy was valid up to May 17, 2005.

Her son was admitted in a private hospital and was diagnosed of a cardiac disease in January 2005.

Ms. Sujatha got her son operated, based on the advice of doctors.

She requested the company to give pre-authorisation letter for her son, as she didn’t have enough money for treatment.

Plea rejected

The company rejected the plea and later repudiated her claim for compensation, with the argument that her son had a pre-existing ailment which cannot be covered under the policy.

Ms. Sujatha filed the complaint in Hyderabad District Consumer Forum seeking Rs.1 lakh, the insured amount, along with interest at 9 per cent per annum from the date of her claim and Rs. 2,000 for court costs.

The insurance company resisted the case and produced a letter from the doctor who treated Lalitha Prasad, which says that “The child was having ailment since the time of birth.” The company argument was their policy doesn’t cover a pre-existing illness and requested dismissal of the complaint.

The forum opined that the letter of the doctor was not enough to prove that the boy had the ailment since his childhood and it awarded the compensation sought by Ms. Sujatha.

Verdict upheld

The company moved to State forum challenging the verdict which the State forum upheld.

It stated that the letter of the doctor cannot establish that the boy’s pre-existing disease.

Above that, the forum felt that the company must have issued the policy after satisfying with the health records of the clients.

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