Mumbai Suburban Consumer Forum Penalises New India Assurance Over Claim
The District Consumer Disputes Redressal Commission, Mumbai Suburban, has ruled against The New India Assurance Company Ltd. and its third-party administrator, MD India Healthcare Services (TPA) Pvt. Ltd., for unfair trade practices after the insurer restricted cataract claim limits without adequately informing a long-standing policyholder. The consumer commission held the insurer guilty of deficiency in service for failing to disburse the full claim amount for procedures conducted in 2014.
The order was passed by a bench presided over by Commission President Samindara R. Surve and Member Sameer S. Kamble following a complaint filed by the Consumers Welfare Association on behalf of the affected policyholder.
According to the complaint, the policyholder had maintained a family Mediclaim policy with New India Assurance since 2004 and had continuously renewed it by paying regular premiums. When the policy was revised in 2012, the insurer introduced a new clause capping cataract-related claims at Rs 24,000 for each eye. However, the company failed to bring these modified terms and conditions to the policyholder's notice or obtain informed consent.
In June and July 2014, the policyholder's father underwent cataract surgeries on both eyes, incurring expenses of Rs 41,642 and Rs 40,000, bringing the total claim to Rs 81,642. Relying on the 2012 clause, New India Assurance paid only Rs 24,000 for each eye, leaving an unpaid balance of Rs 33,642.
Rejecting the insurer's defence, the commission noted that the company failed to produce any documentation proving that the revised 2012 policy terms were ever communicated to the policyholder. The panel also dismissed arguments regarding a two-year waiting period, observing that a condition applicable to new policies could not be invoked against a policy continuously renewed since 2004. Furthermore, the commission noted that MD India Healthcare Services failed to contest the complaint or present evidence on record.
The commission ruled that accepting the partial payout did not constitute a full and final settlement. It directed New India Assurance to pay the balance amount of Rs 33,642 with 9 per cent annual interest calculated from April 1, 2015, until payment is realized. In addition, the insurer and MD India Healthcare Services were jointly and severally ordered to pay Rs 10,000 as compensation for mental agony and harassment, along with Rs 5,000 towards litigation costs.
