Insurance and the law: India

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Deficiency in service

Insurance co. liable for deficiency in service

From the archives of The Times of India 2010

‘Insurance co liable for deficiency in service’

Shibu Thomas | TNN

Mumbai: In the midst of intense war between hospitals and medical insurance companies over health insurance reimbursements, there is some good news for patients. Central Mumbai District Consumer Disputes Redressal Forum, in a landmark order, has held that an insurance company is liable for deficiency in service if it fails to reimburse hospitalisation costs of a patient who has a Mediclaim policy with it.

The forum ordered Oriental Insurance Company and Raksha TPA to pay Rs 64,223 to an Andheri-based couple Ketan (47) and Bhakti Desai (40); the amount was deducted by the insurer from the hospitalisation reimbursement on the ground that ‘‘it was too high’’.

The bench comprising president S P Mahajan and members, J S Iyer and S S Patil, also asked the insurance firm to shell out Rs 10,000 to the couple as damages for causing mental agony and legal costs.

The insurance company paid up the amount earlier this month following execution proceedings initiated by the couple.

‘‘The company’s attitude was outrageous,’’ Ketan told TOI. ‘‘I had a Mediclaim policy with the company for over 10 years and was very regular in renewing the policy annually and paying the premiums. I only claimed the amount that was applicable and so it was a shock when the firm deducted the amount. Once the insurance company approves the hospital bill, how can it say it won’t pay?’’ he asked.

The Desais had a joint mediclaim policy with Oriental for Rs 5 lakh. Bhakti underwent a surgery for ‘‘gall bladder calculus with pancreatitis’’ at Lilavati Hospital in December 2007.

Following her discharge, they submitted the hospital’s bill of Rs 3.94 lakh to the insurance company for reimbursement. Oriental, however, paid them only Rs 3.29 lakh. It said it had deducted Rs 64,223 on the ground that the fees charged by the surgeon, the anaesthetist and the operation theatre bill were too high.

The insurance company also deducted Rs 293 charged for cologne, blade and a warm blanket.

See also

Insurance, life and general: India

Insurance (general): India

Insurance (life): India

Insurance and the law: India