The Central Mumbai District Consumer Dispute Redressal Commission has directed New India Assurance to pay a 78-year-old resident, Rajan Alimchandani, a sum of ₹20,620 for rejecting his claim for home treatment expenses during the COVID-19 pandemic. The commission found that the insurance company made an error in rejecting the claim, citing that there was no hospitalization. However, it was revealed that Alimchandani’s doctor had decided against hospitalizing him due to his age and the risk of exposure to other infections.
The commission noted that the insurance company’s rejection of the claim was a deficiency in service, as Alimchandani underwent treatment at home under a doctor’s supervision, with periodic visits. The commission also took into account the mental distress caused to Alimchandani due to the repeated correspondence and follow-ups with the insurance company, and ordered the company to pay an additional ₹25,000 in compensation for mental distress and ₹5,000 towards litigation costs.
In August 2022, Alimchandani was diagnosed with COVID-19 and his doctor decided to treat him at home, citing his safety and the risk of exposure to other infections. He submitted a claim to the insurance company, but it was rejected, citing policy terms that require a minimum of 24-hour hospitalization to qualify for benefits. The insurance company also argued that the claim was inadmissible under the policy’s exclusion clause for outpatient department (OPD) treatment.
The commission, however, dismissed these arguments, stating that the treatment provided under a doctor’s supervision for COVID-19, even at home, warranted coverage. The rejection of the claim constituted a deficiency in service, and the insurance company’s actions caused unnecessary mental distress to the complainant. The commission ordered the insurance company to pay the claim amount of ₹20,620, as well as the additional compensation for mental distress and litigation costs.