Health insurance is rapidly becoming more and more important with the increasing cost of health care, and the number of diseases which have cure, or in which life can be extended. As an example, whereas earlier, diseases such as cancers or AIDS were seen as illnesses that would lead to death, but in the current age, these are treatable, or atleast, the person can live an almost healthy life for much longer, through the wonders of modern medicine. There are also illnesses that are becoming more common, called lifestyle illnesses because of a more sedentary lifestyle, illnesses such as diabetes, hyper-tension, and so on. These causes side problems over a period of time, and need more medical care. Because of these and other reasons, there is more health treatment and hence more expenses (if painting a very broad picture).
To take care of these insurance needs, there are a number of insurance companies that have come up and provide medical insurance. Now, when somebody does go in for medical insurance, this is with the valid assumption that when there is a need for medical help, they will be able to get the required money from the insurance company at their time of need. For the safety of insurance companies which base their premium amounts based on the risk profile of the insured, the insurance company can deny payment if they can show that the insured hid some vital fact. For this purpose, they also ask the insured person to go through a medical test, but even then, if they can later show that the person hid some medical history or medical ailment which would have changed the insurance terms, then the insurance company can hold up the payment or even deny the payment. For example, a person could hide a problem of heart disease, which would drastically increase the insurance premium, but the insurance company could later deny payment if they are able to find out about this hiding of the disease.
However, it seems more and more (based on the number of complaints or denials) that insurance companies are taking a harder line on this, and trying to use this prior undisclosed illness to prevent payment to the insurer, even in cases where it does not seem likely that this was valid. As a result, the insured people (or their dependents) are going through great hardness, with the money not coming through, or coming through only after a long and bitter fight, such as this one, where a consumer forum penalized the insurance company. If there are some problems in this current case, it is that the it took time as well as the penalty to the company was so low that they could not care. There is a case of compensation being of the level that it would make the insurance company think more carefully the next time (link to article):
The complainant, Sangeeta Saadh, approached the forum after Reliance General Insurance Company Limited failed to reimburse the medical costs of her husband who died of multiple organ failure during his treatment at a city hospital. She approached the firm with a claim of Rs 2.82 lakh in June 2009 but the company did not reimburse the amount in the past six years.
“Private insurance companies, in order to augment their business, are indulging in malpractices. They issue insurance covers and collect premium from people and thereafter repudiate their claim if it is the same is filed shortly made by the insured within a short span of time after taking the policy by taking refuge of the exclusion clauses forming part of the terms and conditions of the policy,” the East District Consumer Disputes Redressal Forum said.
In the current case, the consumer forum passed strictures against the insurance company, as well as asked the Central Government to ensure that insurance companies changed their behavior.
