District Consumer Commission Mansa directs Care Health Insurance to pay ₹3.11 lakh to policyholder Jiwan Dass after wrongful claim rejection. Full case details, judgment highlights, and implications for policyholders explained.
Complaint Summary : Care Health Insurance Ordered to Pay ₹3.11 Lakh: Consumer Commission Mansa Sets Precedent
| Details | Information |
|---|---|
| Complainant Name | Jiwan Dass |
| Not disclosed | |
| Company/Brand | Care Health Insurance |
| Complaint Type | Wrongful health insurance claim rejection |
| Product/Service | Care Floater Policy (₹5 Lakh cover, premium ₹20,816) |
| Issue Description | Claim rejected on grounds of alleged non-disclosure of obesity despite no link to actual illness. |
| Date of Incident | Hospitalization: March 1–10, 2022 at Fortis Hospital, Ludhiana |
| Company’s Response | Cashless rejected (02.03.2022), reimbursement rejected (05.05.2022) |
| Commission’s Decision | Ordered Care Health Insurance to pay ₹2.91 lakh medical expenses + reliefs |
| Case Reference | CC No. 69 of 2022, District Consumer Disputes Redressal Commission, Mansa. Pronounced: 24.07.2025 |
Full Case Write-Up
The District Consumer Disputes Redressal Commission, Mansa, recently passed a landmark judgment against Care Health Insurance in favor of policyholder Jiwan Dass, highlighting unfair claim rejection practices.
Background
- Jiwan Dass purchased a ₹5 lakh Care Floater Policy from Care Health Insurance by paying a premium of ₹20,816.
- The policy was sold through agent Saroj Rani (Code: 20303734).
- In February 2022, he developed breathing difficulties and fever, and was hospitalized at Fortis Hospital, Ludhiana (March 1–10, 2022).
Medical Condition
The diagnosis included:
- Acute bilateral pneumonia
- Lower Respiratory Tract Infection (LRTI)
- Type II respiratory failure
- Hypothyroidism
- Diabetes mellitus (possibly steroid-induced)
The total medical bill was ₹2,91,497.
Claim Rejection by Care Health Insurance
- Cashless facility was rejected on 2 March 2022, citing “Non-disclosure of material facts.”
- Reimbursement claim was again rejected on 5 May 2022, this time alleging “Non-disclosure of Morbid Obesity.”
The insurer’s investigation claimed discrepancies:
- Proposal form listed weight as 70kg (height 172cm).
- Investigation claimed 103–115kg weight (height 165cm).
- They invoked Uberrima Fides (utmost good faith) and Policy Clause 7.1.
Key Observations by the Commission
- Proposal form was filled by the company’s own agent, not the complainant.
- A 34kg weight difference was deemed implausible for an agent meeting face-to-face to miss.
- No medical evidence linked obesity to the pneumonia and respiratory illness.
- The insurer’s reliance on discrepancies caused by its own agent’s negligence was unjust.
Commission’s Verdict
The Commission held that:
- The doctrine of utmost good faith applies to both insurer and insured.
- Agents often push sales without accurate disclosures, and insurers cannot later exploit these errors.
- Care Health Insurance was ordered to pay ₹2.91 lakh towards hospitalization expenses plus reliefs.
Why This Case Matters
- It exposes how insurance companies misuse technicalities to deny legitimate claims.
- Reinforces that consumer commissions will protect policyholders when claim denials are unfair.
- Sends a warning to insurers: sales practices cannot be turned against customers later.
Frequently Asked Questions (FAQs)
Q1. What was the case against Care Health Insurance about?
A wrongful rejection of a hospitalization claim citing non-disclosure of obesity, which had no link to the illness.
Q2. How much was the complainant’s hospital bill?
₹2,91,497 at Fortis Hospital, Ludhiana.
Q3. Why did Care Health Insurance reject the claim?
They alleged non-disclosure of obesity and discrepancies in height/weight records.
Q4. Who sold the policy?
An agent named Saroj Rani (Code: 20303734).
Q5. What did the Consumer Commission decide?
Ordered Care Health Insurance to reimburse expenses, ruling the denial unjustified.
Q6. Which law principle did the insurer invoke?
The Doctrine of Uberrima Fides (Utmost Good Faith).
Q7. Why did the Commission reject the insurer’s defense?
Because the proposal form was filled by the insurer’s own agent, and obesity had no causal link with pneumonia.
Q8. What is the importance of this judgment?
It prevents insurers from misusing technicalities to deny genuine claims.
Q9. Where was the case heard?
District Consumer Disputes Redressal Commission, Mansa.
Q10. When was the judgment pronounced?
24 July 2025.
Q11. How long was the complainant hospitalized?
10 days (1st–10th March 2022).
Q12. Did Care Health Insurance provide any reimbursement?
No, they rejected both cashless and reimbursement claims.
Q13. What were the medical conditions diagnosed?
Acute pneumonia, respiratory failure, LRTI, hypothyroidism, diabetes mellitus.
Q14. Can an insurance company reject a claim due to obesity?
Only if obesity is directly linked to the illness claimed — which was not the case here.
Q15. What precedent does this set?
That insurers cannot punish customers for their own agent’s misrepresentation.
Q16. Who can file a case against an insurance company?
The policyholder, nominee, or legal representative.
Q17. Where can consumers file such cases?
At the appropriate District Consumer Commission.
Q18. What documents are needed for such cases?
Policy documents, medical records, hospital bills, insurer’s rejection letters.
Q19. What reliefs can consumers expect?
Reimbursement of expenses, compensation for harassment, and legal costs.
Q20. What should consumers learn from this case?
Always keep medical and policy records, and know that consumer commissions protect against unfair practices.
