The Ernakulam District Consumer Disputes Redressal Commission has imposed a fine of ₹96,000 on a Mumbai-based insurance company for denying a customer’s health insurance claim.
The panel, comprising president D.B. Binu and members V. Ramachandran and Sreevidhia T.N., issued the order in response to a petition filed by Joy Paulose of Muvattupuzha against Aditya Birla Health Insurance Company Ltd.
The petitioner sustained serious injuries after falling from a height of 10 feet at his house in February 2024, less than a month after the insurance policy was reportedly activated. He incurred medical expenses amounting to ₹81,042. However, the insurance company rejected both the cashless request and the subsequent claim, citing non-disclosure of pre-existing ailments. The complainant argued that the treatment was solely for injuries resulting from the fall and unrelated to any pre-existing conditions.
Failed to submit response
The petitioner approached the commission, stating that the denial was arbitrary, amounted to a deficiency in service and unfair trade practice, and caused him financial hardship. The opposite party failed to submit a written response within the statutory period.
The commission’s order stated that the insurance company repudiated the cashless/claim alleging non-disclosure of varicose veins and dyslipidemia as seen in the rejection letter and the subsequent re-consideration reply. These communications ignored the discharge summary, which had no mention about any pre-existing disease relevant to the present admission and clearly attributed hospitalisation to an accident, it said.
“Courts and commissions have consistently held that when hospitalisation is due to accidental injuries, repudiation on the grounds of non-disclosure of unrelated pre-existing ailments is untenable in the absence of a causal nexus. In such cases, the repudiation is arbitrary and constitutes a deficiency in service under Section 2(11) of the Consumer Protection Act. The conduct also borders on unfair trade practice [Section 2(47)], as blanket reliance on exclusions to deny a valid accident claim is unfair and deceptive,” the commission observed.
The commission concluded that the opposite party was deficient in service and engaged in unfair trade practices, resulting in inconvenience, mental distress, hardship, and financial loss to the complainant. Accordingly, it directed the company to reimburse the medical expenses of ₹81,042, pay ₹10,000 as compensation for mental agony and harassment, and ₹5,000 towards the cost of proceedings.
Advocate Tom Joseph appeared for the petitioner.
Published – October 18, 2025 04:05 pm IST
