Noida: An insurance company cannot reject a claim solely on the basis of a pre-existing medical condition unless it can prove with evidence that the insured deliberately concealed information, the district consumer disputes redressal commission said.A bench of DCDRC president Anil Kumar Pundir and member Anju Sharma, which was hearing a case filed against Star Union Dai-Ichi Life Insurance Company in Feb 2023, observed, “The burden of proof rests on the insurance company to prove, based on the necessary documents or other evidence, that an insured deliberately concealed the above material facts when filling out the proposal form.”The case was filed against Star Union Dai-Ichi (SUD) and the manager of Bank of India’s Surajpur branch by a Surajpur resident Sudesh , accusing them of deficiency in service by refusing to settle an insurance claim after the death of her husband, Suresh. The complainant claimed her husband purchased SUD Life Samriddhi Plan by paying a premium of Rs 99,521 on Sept 28, 2018. While the policy was valid till Sept 28, 2022, Suresh died on June 18, 2019, during treatment. Sudesh informed the insurance company about the death of the policyholder. She also informed Bank of India, which asked her to come to the branch and submit all necessary documents.Sudesh told the commission that she was informed that the claim would be paid within 120 working days, but she did not get any money till the complaint was filed. “Failure to resolve the case and pay the claim within the terms and timeframe set by the defendant company certainly constitutes deficiency in service,” Sudesh submitted before the commission.In a written statement, the insurance company contended the insured concealed his pre-existing medical conditions while obtaining the policy. “On July 16, 2019, we received the death claim, along with a death certificate stating that the insured died on June 18, following which an investigator was appointed to investigate the claim. On reviewing the medical records, it was found the insured’s discharge summary stated he had interstitial lung disease (ILD) with pulmonary fibrosis with lower respiratory tract infection (LRTI) and that he had undergone a chest CT scan at Max Multi-Specialty Hospital on May 5, 2018, about four months before taking the policy, which revealed the diagnosis of ILD with peripheral fibrosis,” the insurance company said.SUD said it rejected the death claim as per the terms and conditions of the insurance contract and the information regarding rejection of the claim was sent through a letter on Dec 5, 2019.The commission, however, observed the insurance company had not submitted any document related to the treatment of the insured, the discharge summary, or any document regarding the CT scan done on May 5, 2018, at Max Hospital. “Therefore, the opposing insurance company has not been successful in proving its statement,” it said, adding that in the absence of the documents, it was justified to accept the complaint that the insurance company showed deficiency in services.The commission ordered Star Union Dai-Ichi to honour a claim of Rs 885 lakh in favour of the nominee and pay the entire amount with interest within 30 days. It said interest would be calculated from Feb 23, 2021, the date of filing of the complaint. The insurance company was also asked to pay Rs 5,000 as litigation expenses to the complainant.
