Chandigarh District Commission Holds TATA AIG General Health Accountable for Unreasonable Document Requests, Prohibiting Harassment of Insured Individuals

The District Consumer Disputes Redressal Commission-IIU.T. Chandigarh bench of Amrinder Singh Sidhu and B. M. Sharma held the insured cannot be harassed by the insurance company by demanding unnecessary documents which are not in their possession. The bench held TATA AIG General Health Insurance Company Ltd liable for unjustly and unlawfully repudiating a claim made under the policy.

Brief Facts

The Complainant procured a “Health Companion” life insurance policy, a Health Insurance Plan, from the TATA AIG General Health Insurance Company Ltd (“Insurance Company”), where up to three claims for critical illness could be made. Allegedly assured by the insurance company’s agent of coverage for life-threatening diseases and promised a full refund for incurred expenses in case of illness, he paid a premium of Rs.6176/- for a sum assured of Rs.3.00 lakhs. Upon experiencing sudden severe pain in his right leg, he sought medical attention at Lifeline Super Specialty Hospital and informed the insurance company via its official portal. Subsequently, he incurred Rs.1,95,000/- in treatment expenses, submitted a claim for reimbursement and provided all requisite documents. The Complainant alleged that the insurance company harassed him by requesting additional documents and the original policy, despite submission. Further, he claimed that the insurance company unjustly rejected the claim on false grounds. Feeling aggrieved, the Complainant approached the District Consumer Disputes Redressal Commission-II, U.T. Chandigarh (“District Commission”) and filed a consumer complaint against the insurance company.

In its defense, the insurance company stated that upon receiving the claim notification, it commissioned Dr. Biswendu Bardhan from M/s ICG Services to conduct an investigation. The investigating doctor reviewed hospital records and identified discrepancies in dates, events, and medical consultations, alleging that both the complainant and hospital authorities had concealed material facts. Consequently, the insurer argued that the lack of essential information and documents from the complainant made it impossible to make a fair decision based on merit.

Findings of the District Commission

The District Commission observed that the complainant had coverage under the policy when he underwent treatment for acute right limb vascular occlusion, incurring expenses amounting to Rs. 1,95,000/-. Hospital records confirmed his admission on 09.04.2019 and discharge on 11.04.2019. The complainant diligently submitted all relevant hospital documents to the insurance company to support his claim. Even the investigator appointed by the insurance company visited the hospital, reviewed the medical records, and reported that the complainant indeed received treatment for acute right limb vascular occlusion.

The District Commission emphasized that it was the responsibility of the insurance company and its investigators to gather any additional pre- and post-OPD consultations if deemed necessary, rather than subjecting the complainant to undue harassment by requesting unnecessary documents that he might not possess.

The District Commission found that insurance companies often use attractive strategies to lure customers during policy sales but employ various tactics to avoid paying claims when necessary. It cited the Supreme Court’s ruling in Dharmendra Goel Vs. Oriental Insurance Co. Ltd. [III (2008) CPJ 63 (SC)], which highlighted that insurers, leveraging their dominant position, frequently resort to unjust practices by rejecting previously accepted claims when it comes to fulfilling compensation obligations. Such a ‘take it or leave it’ approach was deemed legally invalid and morally objectionable.

Consequently, the District Commission determined that the insurance company unfairly and unlawfully repudiated the claim made under the policy. It ordered the insurance company to reimburse the complainant Rs. 1,95,000/- for Mediclaim, along with 9% per annum interest.

Case Title: Amit Gautam vs TATA AIG General Health Insurance Company Ltd and Anr.

Case Number: CC. No. 28/2020

Advocate for the Complainant: Shri Atul Saini representing Shri Rahul Bedi

Advocate for the Respondent: Shri R.C. Gupta and Shri Sudhir Gupta

Date of Order: June 4th, 2024

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