The Mumbai Suburban District Consumer Disputes Redressal Commission has delivered a significant ruling for health insurance policyholders, holding that insurers cannot mechanically invoke waiting-period clauses to reject claims unless they can establish that the illness was pre-existing. According to reports from Mint, the commission directed Max Bupa Health Insurance Co. Ltd. (now known as Niva Bupa Health Insurance Co. Ltd.) to pay a ₹5 lakh health insurance claim for pancreatitis after the insurer rejected it by citing a 24-month specific waiting period applicable to pancreatitis.
The deceased policyholder was covered under Max Bupa's Health Companion Variant 2 policy purchased in October 2017 with a ₹5 lakh sum insured and renewed in October 2018. As reported by Mint, the policyholder was hospitalized after experiencing severe abdominal pain and diagnosed with acute pancreatitis during treatment. He later died on February 7, 2019, due to acute pancreatitis accompanied by multiple organ failure. The family incurred ₹1.94 lakh in hospital expenses at Criticare Hospital and ₹4.15 lakh at Lilavati Hospital, despite the policy offering cashless treatment.
The commission examined the purpose of waiting-period clauses and noted they are designed to prevent people from purchasing insurance after diseases are already diagnosed. According to Mint, the commission found that the insurer had not established the policyholder had pre-existing pancreatitis, as the policy had been in force since October 2017, while the insured developed acute pancreatitis only in January 2019. The commission also considered the treating doctor's opinion that the pancreatitis was a rare case with no apparent cause, supporting the view that the illness had arisen unexpectedly during the insurance period rather than being a known pre-existing condition.
Another key issue before the commission was the policy's cashless facility, where the complainant was required to pay approximately ₹6.10 lakh towards hospital expenses despite the policy providing for cashless treatment. As reported by Mint, the family borrowed money to meet medical costs on the expectation that the insurer would subsequently reimburse the claim, but the insurer later repudiated the claim by relying on the waiting-period clause. The commission consequently held that the repudiation amounted to deficiency in service and unfair trade practice.
