The Bangalore Urban II Additional District Consumer Disputes Redressal Commission has ordered Aditya Birla Health Insurance to pay a claim of Rs 2.6 lakh to a policyholder, Latha K, after the company denied her claim citing a delay in hospital paperwork. Latha’s son, Pavan, was admitted to KK Hospital in July 2023 after a road accident and underwent treatment for a facial fracture. Despite having a valid insurance policy with a cover of Rs 5 lakh, the family was forced to pay the hospital bill of over Rs 2.6 lakh due to the insurer’s denial of the cashless claim.
The hospital had delayed informing the insurer about Pavan’s admission, which led to the denial of the claim. Latha filed a reimbursement claim, but the insurer raised queries and rejected it, citing “bill pendency.” The hospital later admitted to the delay and provided a letter confirming full payment, but the insurer still did not reimburse the claim.
Latha, a widow with two children, had to borrow money to clear the hospital bill and faced mental agony and trauma due to the repeated rejections. She filed a consumer complaint in March 2024, alleging deficiency in service and unfair trade practices. The commission heard both sides and reviewed the documents, noting that the insurer had unjustly delayed the settlement of a genuine medical reimbursement claim.
The commission observed that there was no dispute over the issuance of the insurance policy and that the family had spent over Rs 2.6 lakh for the treatment. The insurer’s repeated denials of the claim, citing late intimation by the hospital, were deemed invalid. The commission stated that there was a deficiency in service as the insurer had not settled the genuine claim without valid reasons.
The commission ordered Aditya Birla Health Insurance to pay Rs 2.6 lakh along with 6% interest from September 19, 2023, and Rs 20,000 for mental agony. The complaint against the hospital was dismissed, as the commission found that the hospital’s role was limited to treating Pavan and that any liability lay entirely with the insurer. The commission’s order highlights the importance of insurers settling genuine claims in a timely and fair manner, without relying on flimsy excuses or technicalities.