Mediclaim policies cannot be rejected on the basis of assumptions

It can't be assumed that duodenal perforation, the cause of death, was due to alcoholism

Prashant Warankar had taken a mediclaim policy from New India Assurance which covered him and four of his family members. Prior to taking the policy, Prashant's father, Pradeep, was subjected to a medical examination. According to the medical report, he was suffering from high blood pressure and diabetes. Thereafter, the first policy was issued on July 9, 2008. It was subsequently renewed without break. In the third year of the policy, Pradeep was hospitalised for duodenal perforation. He was operated upon, but died four days later due to multiple organ failure, septicaemia and duodenal perforation. A claim for Rs 151,880 was lodged for reimbursement. 

Treatment of duodenal ulcer perforation was covered under the policy after a waiting period of two years. As the policy was in its third year, the claim ought to have been paid. Yet it was rejected on the ground that duodenal perforation was caused due to chronic alcoholism along with diabetes and hypertension. 

Prashant approached the Consumers Welfare Association which filed a complaint before the South Mumbai District Forum. Reliance was placed on medical literature to show that duodenal ulcer could occur due to a bacterial infection or use of non-steroidal anti-inflammatory drugs such as aspirin. Other factors such as smoking, stress and drinking heavily might have possibly increased the risk. The doctor had certified that even though the patient used to take alcoholic drinks intermittently, it could not be pinpointed as the cause of duodenal perforation.

The insurer, through its third-party affiliate Health India, contested the case, insisting that the perforation was caused due to drinking, and so was not payable under the terms of the policy. The District Forum upheld the insurer's objections and dismissed the complaint.

The Consumers Welfare Association, along with Prashant, challenged this decision before the State Commission. It was pointed out in the appeal that the Forum had erred in believing the medical summary without there being any proof to establish veracity regarding the patient being an alcoholic. Besides, the medical literature showed that there could be several causes for duodenal ulcer and perforation, and no evidence had been furnished to show that the patient had suffered the ailment solely due to alcoholism. 

The Commission relied on a similar dispute it had adjudicated earlier, where it had been held that a claim for cirrhosis of the liver could not be repudiated on an assumption that it was solely due to alcohol consumption. Similarly, in this case there was no evidence to show that duodenal perforation had occurred solely due to alcohol. 

By its order of February 20, 2017, delivered by A K Zade for the Bench along with Usha Thakare, the Maharashtra State Commission set aside the Forum's order and directed the insurer to settle the claim within sixty days. The insurance company was ordered to reimburse the medical expenses of Rs 151,880, pay Rs 10,000 as compensation, pay Rs 5,000 towards cost of the complaint, and another Rs 3,000 towards costs of appeal.

The writer is a consumer activist