Pushpagiri Maji
I have health insurance for the last 15 years. Six months ago, I had to undergo emergency medical treatment, which gave me an invoice of Rs 40,000. However, the insurance company offered to pay only 30,000 rupees because the terms of the contract changed the previous year at the time of renewal. I was never told about it. Will these new conditions bind me or can I fight for a full refund?
The insurance company cannot refuse a full refund to you for the following reasons: (A) If the terms of the insurance policy change, the insurance company was obliged to notify the customer of those changes. In that case, you may have taken the portability option and moved to another insurance company under better conditions. Therefore, the insurance company must infringe and be responsible for your right to the information and choices given under the Consumer Protection Act. (B) By not informing you of the changed terms, the insurer also requires the insurer or its agents to provide complete information about the insurance policy with the Insurance Regulatory Development Authority (insurance policyholder’s interests). Protected) Violated the rules. Various terms of use. (C) The behavior of an insurance company also violates the basic principles of insurance law (the principle of good faith), which legally binds policyholders not to misunderstand or withhold information from each other.
When the policy is updated, it is expected that the same conditions will continue. He needs to notify you if the insurance company makes any changes. Because he didn’t do that, he can’t now bind you to a new term that was never informed to you. You can seek relief through either the Insurance Ombudsman or the Consumer Court.
Which case law may be useful?
On a similar issue to you, there is an excellent Supreme Court ruling issued on December 9, 2021 in Jacob Punen v United India Insurance (Civil Appeal No. 6778, 2013). Here, the petitioner had medical insurance that was renewed annually since 1982. In 2008, one of the insured had to undergo angioplasty and the hospital claimed about 3,82,000 rupees. However, the insurance company only pays 2 rack rupees, and according to the updated policy, only 70% of the policy limit can be charged for procedures and surgeries, for a total of 2 racks per surgery or procedure. Rupee restrictions apply.
The District Consumer Dispute Relief Commission states that insurance companies are policyholders as well as policyholders are obliged to provide insurance companies with all important information, as insurance policies are the most sincere contracts. We have determined that we are obliged to notify you of the changes. From a policy perspective. As they did not, the insurer cannot point out new conditions for denying the insured’s legitimate claims. Therefore, the insurance company was required to pay the full amount in addition to Rs5,000 as compensation.
However, state and national consumer commissions disagreed with this view, forcing consumers to ultimately seek the help of the national Supreme Court. The Supreme Court upheld the order of the local committee and set aside the order of the state and national consumer dispute relief committees.
The SC clearly noted that insurers are obliged to notify policyholders of any changes incorporated into the policy at the time of renewal. Insurance companies couldn’t do that, and policyholders were exposed to the dark about the changes. Therefore, the obligation to trust the insured was broken and the insurer was responsible for the consequences. The Supreme Court also noted that failure to notify policyholders of the restrictions introduced in renewed insurance policies would constitute a lack of services provided by insurance companies in accordance with consumer protection laws. Therefore, consumers were entitled to a full refund. In addition to restoring the order of the district committee, the SC has also awarded Rs50,000 as a consumer expense.
